Digital Transformation: What it is and how to get there

Editor's Notes

• #9: Clearly Net-a-Porter focus a lot of effort on their digital experiences. But just as much consideration is given to the whole experience including non-digital ones such as personal shoppers and the packaging. Indeed these non-digital experiences are arguably more important than the digital ones to Net-a-Porter’s highest value customers. “EIPs” are more than VIPs. They are Extremely Important Persons. These are the top 1% responsible for a disproportionate amount of Net-a-Porter’s business. Their orders are prioritised - picked, packed and despatched first. They get an even better customer experience.
• #10: This may not now be illustrative / fair but at the time the Liberty experience of a taped up jiffy bag was no way near as good as the Burberry experience. Companies like Apple are also known for their packaging. Burberry is well regarded for its pioneering digital experiences. But the point is that to be ‘digital’ is about focusing on the customer experience across all touch points, not just the digital ones.
• #11: Amazon regularly tops customer satisfaction surveys as this letter from Jeff Bezos shows. And yet, as this research from Oracle shows, it is also the case that customers want a telephone number to deal with queries. We all know how hard it is to find a telephone number to contact Amazon. So how come customers are so satisfied with them? It is because everything just works. They focus so much on the customer experience and making it easy that you don’t have to resort to customer service. Executing on customer experience is the best route to customer satisfaction.
• #12: Amazon have done impressive and pioneering things over the years in digital e.g. One-click. But now their digital experiences are no better than others who have caught up? In fact, now, it is Amazon’s non-digital experiences (delivery) that make them stand out. As a titan of ‘digital’ businesses they too are focused on all channels to optimise the experience, not just digital ones.
• #13: National Geographic brought to live through Augmented Reality in a shopping mall. Meatpack’s mobile application ‘Hijack’ Audi’s Digital Car Showroom Window-shopping through tablets and phones (Net-a-Porter)
• #15: Commercially minded Customer-centric Transparent – data available to all, including commercials Collaborative – multidisciplinary teams (that often change by project) Environment - tools/tech to collaborate (cloud/SasS); hierarchy not evident (e.g. ‘department’ not used but ‘team’; open plan offices) “Growth hacker” - marketing + tech closely aligned; marketers are tech savvy… techies are marketing-savvy Empowered – ‘fail fast’, ‘ideas from anywhere’ Data-driven – test and learn. Evidence-based decisions Passion – hungry to learn more Innovative – naturally innovative. Embrace change. Curious. Agility – in processes & approach
• #16: The second two points relate to Econsultancy’s marketing team. ‘Digital’ marketing is the norm for them. Where they get excited is ‘traditional’ marketing. This ‘retro’ thinking seems to be a characteristic of sophisticated digital organisations.
• #17: This is Econsultancy’s model to show how organisations mature from emergent to managed to optimised across the four key transformational vectors of strategy, technology, people, process.
• #33: Tate’s online strategy is interesting partly because it is public and also because it is now in its second incarnation so you can see how thinking has moved on. The level of sophistication in their thinking is evident in the sub-title to the latest digital strategy “Digital as a Dimension of Everything”.
• #34: It matters less that your digital/design principles are ‘correct’ and more that you actually have them in order to guide decision making and focus the efforts.
• #51: Commercially minded Customer-centric Transparent – data available to all, including commercials Collaborative – multidisciplinary teams (that often change by project) Environment - tools/tech to collaborate (cloud/SasS); hierarchy not evident (e.g. ‘department’ not used but ‘team’; open plan offices) “Growth hacker” - marketing + tech closely aligned; marketers are tech savvy… techies are marketing-savvy Empowered – ‘fail fast’, ‘ideas from anywhere’ Data-driven – test and learn. Evidence-based decisions Passion – hungry to learn more Innovative – naturally innovative. Embrace change. Curious. Agility – in processes & approach
• #54: Used to talk of people who are T-shaped i.e. Deep specialism in one area but a broad base of skills/knowledge. For digital now we see this being extended to the idea of Pi-shaped where both left and right brain skills are required: an ability to be creative/irrational/emotional/intuitive but also analytical, technical, data-driven.
• #55: One of many new roles to emerge that is ‘pi-shaped’
• #56: Likewise the growing roles around ‘product management’ that are very typical of internet companies like Google, Amazon, Facebook etc.
• #57: An interesting idea to address the problems of IT/marketing alignment at the top of the organisation and create pi-shaped capabilities. This from a FTSE 250 company (finance, spreadbetting). The CIO became CMO.
• #58: There are arguments against having a Chief Digital Officer (it concentrates too much in one person, it dis-enfranchises the CMO or CTO who should be leading digital etc.) but also arguments for it (necessary interim step to move large organisations forwards etc). Seems likely to grow/continue for now. But should be an interim position and needs to report to CEO to have necessary authority/mandate.
• #59: This is all challenging for HR departments who are not used to the job titles, what the roles/responsibilities are, how to hire, what the career progression should be, what training is necessary, how much to pay and how this relates to existing roles etc. There is a need to train HR teams in all this.
• #60: Some thoughts on what it is that attracts top digital talent to an organisation. Not necessarily ‘digital’ – these criteria attract talent in any discipline.
• #62: Co-location and mixing of teams in an open environment is important and effective to make digital work. This was a learning and precursor to the even more evolved office space in Salford – see next slide.
• #63: This shows the open environment again. The circular meeting spaces echo the idea of collaboration, of small “rounded” teams, with areas where people can come together in an ‘ad hoc’ way.
• #67: Teams that are small enough that they can be fed with two pizzas i.e. 6-8 people.
• #69: Agile has been around for quite a while for software development
• #70: But this thinking and approach, which is very well suited to digital, is permeating other departments. For example marketing. There is now a manifesto for agile marketing proposed.
• #71: Large companies are trying to embrace the ideas around agile and ‘lean startup’ thinking.
• #72: The best digital companies realise how important speed is. fastFT is a new product from the FT around breaking news. FT Fastclick is code that FT have open-sourced which is about making clicking in a mobile web app feel as fast as clicking in a native app. A small touch but a vital one if customers aren’t to tire of using an application that is just a bit too slow to be useful.
• #73: Arguably Google’s USP was never about its alogrithm but about its clean interface and the speed at which it worked. To this day it shows how fast it returns search results. The latest algo update (Hummingbird) is about speed, agility and precision as the name implies.
• #74: Google Now bring you results and information before you’ve even requested them.
• #75: Apple also recognise how important the speed and responsiveness of a digital experience is. The recent iOS7 update focused on this along with a cleaner, flatter, less intrusive design.
• #76: Digital operates very quickly so your processes, teams and business needs to be able to react and respond at the same speed.
• #79: Twitter has been described as the ‘heartbeat’ of what is happening in the world. The speed at which things break, and our shared, on Twitter is almost instantaneous so businesses need to be able to capitalise on opportunities, or mitigate problems, much faster than ever before. In this screenshot where Ed Miliband makes up the hashtag #DowngradedChancellor you can see how quickly there is a massive spike (seconds) on Twitter from nowhere for this hashtag.
• #80: A metaphor for thinking about how marketing and business operations in the digital world is changing. It used to be like a stalagmite approach – by continually drip feeding stuff through, over time and in a linear way, you hope to build something and make an impact. Now it is more like being a conductor. There is a score you are working too and you have specialists in your orchestra but there is much more dynamism, more light and shade, more responsiveness, more sensing of the audience, it is choreographic and orchestrated, not so fixed and linear.
• #84: This is the digital journey towards excellence but it corresponds to business excellence not just digital excellence
• #85: Burberry is considered excellent at digital. And it has been doing very well as a company. Which came first – business or digital excellence? Probably the former but there does seem to be a very high correlation between companies being good at digital and those doing well overall.
• #86: ... As this research from CagGemini and MIT Sloan also shows.
• #87: So focusing on digital transformation and becoming excellent at ‘digital’ in the broader terms outlined in this presentation (focus on customer experience across all channels, having a digital culture) is really about business, not just digital, transformation.