Convex Interactive

What It Takes To Digitize Your Business

“Digital transformation” is one word you’ll hear from every business leader these days. The business world is moving at a fast pace breaking down barriers and establishing new business models, and the organizations are either accelerating or getting left behind. The aim of all this is to build stronger customer relationships, increase cross-selling opportunities and focus on corporate growth. It’s an unavoidable change to exist in this digital world with a customer who is always connected to a world of discoverability and has access and choice at their finger tips. A CEB research in fact shows that 87% of senior business leaders consider digitization as a priority for their company – and 66% have a fear that failure to digitize can risk their position in the competition. A great example of this is the recent launch of Amazon Go – which is raising the bar of retail world more high, by making use of world’s most leading shopping technology so the customers get to shop in-store without having to wait in a check-out line.

As suggested by a  2015 MIT Sloan Management study, the move to a world more digital has resulted in the making of a new type of organisation, the “ecosystem”, best examples of this are Amazon, Uber, Airbnb, etc. An ecosystem company, in terms of digital , is an open system of partners (official and/or unofficial) collaborating to deliver against a higher-order customer need. These players are defining the customer experience in a different way, they return back their customer’s loyalty and  understanding by giving them a path where they can achieve their higher-order needs by making very less effort, along with a satisfying customer experience. The anchor brands in these ecosystems encourage profits from customers as well as the ecosystem players, because they provide the platform that supports the ecosystem.

According to a study done at MIT, it was found out that those companies whose 50% or more revenues came from digital ecosystems, their revenue growth was 32% high and profit margins 27% high as compared to their competitors.

We understand that building an ecosystem needs a lot of determination and is often risky, but companies like Uber, Airbnb and several others teach us a lesson that if you won’t build an ecosystem in your category then somebody else will, and then you’ll probably find your company trying to make some use of little pieces of pie in corner of somebody else’s ecosystem.

The absolute necessary element you need for the success of such ecosystem players is an approach called  “systems thinking”.  It is a comprehension of the working of an ecosystem, including minor details of every separate part of the system, as well as the macro-perspective of how all separate parts work together as a whole. But this approach of systems thinking does not work alone, to make it work it has  to be paired up with “systems acting.” Most organisations work in silos – where each silo works independently and is effective to it’s own end not to the entire ecosystem, the customer is not the centre of the entire eco system but of each of the silos. But, this way of thinking does not produce a prosperous or growing ecosystem, because customer’s experience this way results in being inefficient, disjointed or unworkable. Sadly, systems thinking does not occuur naturally to organisations that operate vertically, in fact it’s different then that, systems thinking needs a change to operate horizontally through the customer journey and is hard work.

 

 

Source:

https://www.forbes.com/sites/patrickspenner/2017/01/24/what-it-takes-to-digitize-your-business-hint-courage-required/#15a732d552c7

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