Digital strategy has become an expansive term, and it’s getting to be more and more of a priority in the minds of executives. It’s also become an increasingly popular topic in the news.
To put it generally, digital strategy is a plan of action designed to achieve business goals via the implementation of digital initiatives.
Digital strategy is not about a whole new way of viewing business. Technology has changed, but the nature of business is much the same as it always was. All the hard-won insights into successful business strategy hasn’t become irrelevant just because the playing field has become digital. Instead, those basic truisms of how a business achieves success form the underlying basis for today’s cutting-edge digital strategy.
One of the pitfalls business leaders fall into is being enticed by emerging technology. Too often, a company’s “digital strategy” becomes a blind embrace of the latest and most exciting technology for its own sake. Businesses can get distracted by buzzwords, and attempts to create strategies that can include as many of them as possible can at times take hold. This approach may provide some short-term publicity, but that advantage quickly fades when it isn’t backed up by a strong business strategy. Digital should be a tool — and it’s an impressive one — but is only a part of the bigger picture of what an all encompassing business strategy and how it relates to the digital transformation process with respect to processes and procedures.
Business success depends on human performance, and digital technology is only useful to the extent that it fosters that goal.
A good strategy begins not just with asking questions, but with asking the right ones. What’s the position in the industry right now? Where does your company want to go? What do you need in order to win? What are the gaps your company faces on its pathway to winning? Those gaps are where your opportunity lies.
To understand a business’s position in the marketplace, benchmarking against core competition is an essential step in understanding this entry level part of a strategy process. It’s only from effective benchmarking that a company can gain an analytical viewpoint on exactly where they stand — not only with respect to their competitors, but also within the larger business ecosystem.
Once a business has a clear sense of their own digital position, they can then begin to develop a strategy of where they want to be.
Another essential result of the benchmarking process is that it can assist in providing a clear understanding of how well a businesses current systems and positioning are working. Before you introduce digital innovations, it’s imperative that you distinguish between aspects of your company that are weak because they lack effective digital solutions, and those in which existing problems are the result of non-technological issues. For example, if customer service is falling short, addressing hiring and training practices before adding new digital solutions, such as automated chat could be a solution.
In the end, strategy is only as effective as the underlying business functions of your company.
The foundational layer of digital strategy is your basic business model. A business’s use of digital can’t be examined in a separate petri dish; it’s integrated into the organic whole of how a company runs, as well as what they aspire to be. Building upwards from the basic business model, we look at:
If business strategy is the same as it always was, you may be asking why digital strategy is important.
Here’s where the beauty of technology as a tool. The speed of doing business has increased in quantum leaps. It wasn’t long ago that a retailer had to have their summer styles in the pipeline while snow was still on the ground. Publishers used to need material six months in advance, before they could think about getting it out into market. Digital cuts through that, offering just-in-time manufacturing, instant A/B testing, individual RFID tagging and countless systems for direct real-time feedback. However, just because a business can do something doesn’t mean they should. Businesses only benefit from the technology that’s specifically geared to bring them closer to their own ultimate strategy, and technology has to serve as a ladder in order to achieve what the company is aspiring to be. It’s not an end in itself.
It’s starts with an initial frame up of the company’s objectives in the context of a traditional business strategy, and then utilizes digital methods to achieve their desired outcomes.
The reason digital strategy must be agile is that it’s constantly striking a balance between two very different forces as it works to integrate your basic business principles with the swiftly changing technological universe. You always want to give your customers an outstanding experience, you want your employees to feel inspired to perform at their highest level, and you need to maintain solid, reliable commitments with partners and suppliers — these goals don’t change. The methods of achieving these goals, however, and the tools that underlie those methods, evolve so swiftly that keeping up with them has become a profession of its own.
So, how do you reconcile those forces? First, keep your eye on your customer expectations, and secondly, take advantage of professional digital strategy consulting.
While the quickly changing digital ecosystem may or may not influence the shape of your current products, we guarantee that it’s changing your customers. With each technological step forward, customers respond by taking that new step for granted. Your brand identity may not change, but the world in which it is embedded is constantly reinventing itself.
The Internet of Things and the proliferation of smart products means that customers increasingly expect to be surrounded by a web of responsive portals and devices. Payment gateways are no longer tied to physical cash registers, even for in-person shoppers, while geo-location and Bluetooth beacons make for constant omnichannel contact.
If your customers have an intention or an impulse, they expect to be able to follow through with it seamlessly. They’re learning that more devices speak to them and recognize their voice, and that artificial intelligence increasingly anticipates their needs. Their patience for clicking through different screens is decreasing with every season, so apps that deliver personalized experiences have to also make it effortless to conduct transactions from the same screen.
Centric Digital’s playbook gives you the benchmarking and insights that allow you to move forward in a complex environment. You know your business and will work with you to develop the technological framework you need to get out in front of your field.