In the age of Digital Transformation, we are seeing a proliferation of new technologies and innovative solutions that challenge our ability to adapt. Companies must adapt to change if they are to play their part in a competitive marketplace. In fact, if my direct competitor invests in technology solutions and gains a significant competitive advantage, as a business owner, I can’t sit back and watch. So how do I get on the digital transformation train? With a proper digital strategy.
Analog approaches are no longer needed
When working as a consultant, it’s common to find small businesses trying to ignore the digital change taking place. The reason is simple: they’re afraid of losing control of the processes they’ve managed a certain way for years. It’s clear that the digitization of companies is no longer a competitive advantage, but an essential change to be projected into the future. Therefore, you start to think about how to approach it and you come to an important realization: “We need a digital strategy”. Usually, in these cases, all eyes point to the marketing and communications department. We’ll see that in this process it’s not just marketing that needs to act, but there are many other areas involved in the strategic definition.
“Success is 20 percent skill and 80 percent strategy. You can know how to read, but more importantly, what are you going to read?” Jim Rohn
What is a Digital strategy and when does it become essential?
The Digital Strategy involves defining a new vision, mission and goals geared toward responding to external digital changes. Initially, it will be drafted by executives and will serve to bridge the gap between the company from its competitors. The same ones who have already embarked on the journey towards Digital Transformation. Subsequently, all departments will be involved in the change management phase: the marketing department, the commercial department, finance and human resources. After that, all employees will be involved. A legitimate question in any change: “What about all the value I’ve generated so far?” The experience gained over the years on business processes and dynamics will be the basis on which the guidelines of the digital strategy will be defined.
Digitization is just a new language that makes what has always been done more efficient and effective. The goal is to get everyone to adopt a digital approach, a sort of common language that the “digital” employee will need to understand in order to align with strategic decisions.
The infographic posted on Meltmedia’s blog shows how important it is to have a digital strategy that connects and reflects across all business departments.
Which departments are involved in the digital strategy?
Certainly, the first departments to be involved are Marketing and Information Technology (IT). Their goal will be to enhance and promote the company through digital channels. In addition, they will be evaluating performance, customer satisfaction, and communicating the value of innovations to customers.
Change must always come through employee engagement. In other words, HR will also need to strategize. Indeed, changing work habits is not easy and requires proper training. It will also be tasked with recruiting new resources with skills in line with the future vision.
The digital strategy also reflects on sales. The sales department will be able to do digital sales, meaning combine face-to-face sales with digital activities. What is the outcome? The salesperson will physically meet the customer after the customer has already been contacted via digital channels by the company. Basically, he/she will already be engaged or open to making deals. This will reduce empty visits.
Also important is a proper analysis of the planned investments and constant monitoring of ROI (Return On Investment) to make the right choices. If the strategic choices prove to be successful in the first phase there will be an increase in revenue. This can be reinvested in areas, processes or actions that were initially out of the planning.
Finally, it will be necessary to invest in Artificial Intelligence solutions, process automation and workflow optimization tools. On the one hand, you will need to improve business performance, on the other hand, you will need to make your operations more efficient and effective to achieve your goals.
Digital strategy runs through operational efficiency, brand value, innovation, customer satisfaction, knowledge retention and business value. Click To Tweet
Digital strategy and performance analysis
How do we know if we’re on the right track? Technologies and digital process transformation necessarily require digital education. Habits need to be changed, employees need to be trained, times need to be adapted. For this reason, change management will have to go hand in hand with corporate digitization.
The steps to follow are the same as any long-term planning:
- Define goals and investment. We need a new vision that answers the following questions: what are the processes and actions we want to digitize? In addition, we need to define a roadmap with a clear objective. We can choose, for example, between increasing sales, improving customer satisfaction, acquiring new contacts.
- Scenario Analysis. It is important to assess where we are, what we have already done, and what we need to invest in to achieve our goals. It is also essential to analyze the competition and assess the company’s strengths and weaknesses. In this way, we will choose the right actions to overcome the critical issues.
- Planning. The actions here are aimed at redefining governance. The first step is to identify the milestones achieved. You also need to engage and inspire departmental teams to assess what the critical issues might be. Finally, you have to determine how to optimize implementation time. At this stage, it is essential to also involve external figures who will take part in the project.
- Strategy Implementation. We are now in the operational phase, and from this point, we must never lose sight of the importance of working in synergy. Given the directives to be followed, departments must interact constantly. In this way, as soon as critical issues or bottlenecks arise, it will be possible to evaluate any alternative actions to be taken.
- Performance Assessment. Finally, the managers need to set the KPIs to be tracked and constantly monitor their progress. Only by correctly defining objectives we can identify which KPIs are significant to their achievement. For instance, the metrics to consider are those that relate to sales, human resources, supply chain, but also customer satisfaction. In addition to internal metrics, it is also important to monitor the increase in competitive advantage.
Let’s be clear: the road to digital is always uphill, and once the first objectives have been reached, the bar is raised and the first step is to be taken again. This process reflects the PDCA cycle, Plan – Do – Check – Act, used in business for continuous improvement.