Digital transformation is the current craze in many boardrooms, urging board members to implement a digital strategy to fully go digital. Only then can your organization stay relevant in the Age of the Customer. And that calls for improved customer experience, a customer obsession and customer-centricity in all your business processes. Now, these goals may seem crystal clear. But why does it feel like a mission impossible to implement a digital strategy and become a customer-first company?
Picture this: you are a member of the board in a multinational organization. Your CEO got back from a TEDx presentation where he had an aha moment while listening to a thought-provoking talk about digital transformation. At the same time, other board members are getting nervous about the competition going digital and new players disrupting your market.
It is the Age of the Customer and your organization is realizing the need to create high-value, in-person and digital experiences for your customers. And then the board decides to make you responsible for speeding up the company’s journey towards digital transformation. Where do you start?
Why Would You Spend Time on Digital Strategy Anyway?
Thanks to the introduction of high speed mobile connections and the first smart phone by Apple, the customer is in control now. In the Age of the Customer the empowered customers are shaping business strategy and making or breaking companies.
The customers of today want seamless experience – if you can’t provide instant gratification, the competition is just a click away. You‘ll need a digital strategy to meet increasing customer expectations and new market players, if you want to stay in business. But don’t take only my word for it.
5 Key Figures Every Board Member Should Know
These five key figures by researchers and analysts all point to the same terrifying conclusion. Either go digital now or face certain extinction.
- According to Internet Live Stats, more than 1 billion websites on the globe provide instant value in the shape of news sites, social networks, music and video sites, webshops, communities, directories and blogs. That number is still growing.
- At Black Friday last November a new record was set with $ 3.34 billion spent online, Adobe reports. Millenials (aged between 25 to 34 years) were the most active shoppers online with 62 percent.
- Black Friday was also the first mobile shopping day in retail history to pass the billion-dollar mark. Mobile revenue grew with a 33 percent increase to $ 1.2 billion. With 56 percent of visits to retail website, mobile is leading the way forward. Retailers that invested in mobile, email and social have seen 30 percent more sales on average and 25 percent higher average order values.
- 62 percent of the companies is in denial about the need to transform digital, according to Progress’ 2016 Report on the State of Digital Business. 47 percent haven’t put a digital strategy in place to embark on digital transformation.
- It clearly pays off to have a digital strategy in place to increase customer experiences, according to Forrester. There is a 24.9 percent difference in revenue made by digital leaders compared to digital laggards.
Your Digital Strategy Starwith Customer Orientation
Your digital strategy is not about your company – it is about your customers. A digital strategy is basically a customer strategy for the customers of today, who are digitally savvy. Customer Orientation is an ongoing process where you do everything you can to understand what drives your customers and what makes them tick. Get out the building and talk with them, show your customers what you are working on and monitor every interaction to continuously improve the customer experience. Because without an absolute obsession for your customers and their experiences, any strategy is bound to fail.
The shift many successful companies made is to change from being transaction-focused to become customer-focused. That means figuring out what customers need and how they experience the value that you bring, across all touchpoints. And only then can you look at the team and the technology that your organization needs to meet the customers’ expectations.
How Microsoft Went From Giant to Niche Player
Microsoft left the 20th century owning over 95 percent of all operating systems. In order to stay ahead, CEO Steve Palmer organized the company around the execution of its strengths. A strategy that optimized business processes for efficiency, but also one that was looking inwards. It helped Microsoft with short-term goals but caused Balmer to overlook customer-centric areas as search, smartphones, mobile operating systems and cloud. Microsoft’s market share in mobile OS today is a mere 1 percent.
To read further on making the right innovation choices as a leader, please see my blog: Innovation and leadership: Do or die?
Not the Board but The Customer is in Charge
It is the customer now that sets the course of your business strategy. And that can be a tough message to sell to the board. It may feel like you are running after the customer, erratic in its behaviour, averse to showing any loyalty and ever-demanding. But that is exactly what the Age of The Customer means: the customer is in charge now. And your company must follow in order to keep up.
The good news? The customer is in charge, and you can relax now. No longer do you need to try and tell them what to think, like or buy. The customer of today has full control over his own media diet, can like and unfollow as he likes and values customer experience above all else.
Customer-Centricity is All About Asking Questions
If you set your company to follow the customer and become truly customer-centric, your business will flourish. Consider placing Customer Orientation in the DNA of your company. Customer feedback should make you think about the fundamentals: why do we do what we do? Why do we think what we think about our products, customers or business models? What beliefs are engrained in our company culture and where are our blind spots? In short, you need to realize what you do and don’t know and ask yourself continuously: are we on the right track?
Once you start asking these difficult questions, you’ll begin to see the organizational changes and talent that is required. The silo’s to be brought down and the continuous innovation that needs to be put in place next to efficient business process. In our next blog I’ll cover the challenges companies will face on their way to Customer Orientation.
Article by Frans Stijnman, Digital Strategy and Customer Experience at Osudio