Adopting a digital strategy

Having long departed from the tired and singular practice of physical interaction, contemporary businesses are now moving towards the ready adoption of digital platforms. A medium of unerring complexity and of perpetual advancement, businesses need to demonstrate a deep-set understanding of the medium and of consumers if they are to successfully implement an efficient digital strategy.

Without the pressures of rent and with far fewer staffing requirements, the costs of digital enterprises are generally less than those of a physical equivalent. This factor, as well as the digital market being of a far larger scale, has pushed many businesses into conceding digital is an essential element of business.

Companies are accordingly merging new digital products and services with long-existing physical approximations. Merge Records, Marvel Comics and various Blu-ray distributors have started to accompany the sales of their products with complimentary digital equivalents, while Kellogg’s supplements Krave cereal with a Facebook-compatible online game. However, although the method of digital compatibility is routine, the business of executing an effective digital strategy is a complex endeavour.

The emergence of digital
As the business of management has seen ‘digital’ slip into its discourse, so too have corporations seen digital representatives take a seat in the C-suite. Chief digital officers – or digital directors – have become a common fixture of the workplace. Research firm Gartner attests that, of 390 senior business leaders surveyed, 52 percent have implemented or are starting to implement a digital business strategy.

Mark Raskino, Gartner’s Vice President, who oversaw the survey, said the terminology of ‘digital’ has varied in accordance with three different time horizons: those who “are looking at the whole e-commerce, e-business area that everyone was talking about in the late 1990s and thinking, ‘We haven’t done this as fast as we should’; those who feel the need to show that they’ve got good mobile applications for the bragging rights among their peers; and a surprisingly select few who consider digital a fixture of the near future, a time in which products themselves will become digital, the most obvious example being the automotive industry”.

All consider an element of pressure or imminence in their terming of what comprises digital. And herein lie the roots of a great deal of strategic incompetence in the adoption of digital; many businesses see it as an add-on, as opposed to a direct point of contact with consumers or employees.

To compound difficulties in establishing a digital strategy, businesses are required to challenge a long-established – and perhaps decayed – physical model reliant on both places and people if they are to succeed. To do so, enterprises are required to tend to three specific elements in going digital: internal power, affirming the ownership of a resulting customer experience; business processes, requiring the integration of cross-channel platforms to maintain a seamless experience; and customer data, wielded as an enterprise-wide resource rather than being isolated in any single department.

MIT Sloan Management Review maintains that three trends have emerged on the road to present digital business models. The first is the digitisation of many aspects and departments of business – incorporating customer experience into business processes and in B2B operations. The second trend is an increasing number of ‘digital natives’, whose expectations demand an impeccable and entirely unique digital experience. The third, and perhaps the most significant, trend is in the dawning of a customer voice, through which customers are permitted a greater say in the reputation of enterprises via ratings systems, social media commentary and other similar mechanisms.

We haven’t done this as fast as we should

Many enterprises mistake digital strategy for online strategy – terms too often used interchangeably. The differences – though subtle – are of significant enough weight to justify a definition for each: online strategy is the plan to deploy online assets, whereas digital strategy is a far more transformative and holistic change to business.

Ultimately, a digital strategy constitutes a company’s utilisation of digital means to generate added value, employing websites, applications, software and hardware to create an especial customer experience: the essence of which informs the near entirety of an effective digital business strategy.

Consumer experience
Essentially, the digital customer experience is that which above all else differentiates it from the physical equivalent. Whereas companies once competed on the grounds of production – their ability to bring readily available and affordable products to the masses being the determining factor in bolstering sales – advancements in production processes and in distribution have since rendered these considerations secondary.

Though both innovation and marketing are invariably central to success, the contemporary consumer resonates with those enterprises offering a customer experience unparalleled in quality and unique in its offering. With the continued proliferation of connected devices, customer expectations have reached previously unseen heights. For this reason, far too many companies are tackling devices in isolation – offering a seamless experience, but only to one device. Instead of honing in on channel-specific experiences, companies foster consumers whose preferences lie with multi-channel, concordant enterprises in order to avoid a disjointed customer experience.

If companies are to attract and sustain customers of this nature, then they need to ground their digital efforts in a distinct brand ethos or mission. Abiding by this method, a decided digital strategy will better reflect wider business objectives in an actionable plan that is consistent across all channels.

Digital adoption
Whereas the media sector has lead the transition from physical to digital – and those in retail and financial sectors have followed in close succession – others have largely struggled to keep pace. Each of these sectors has been spurred or hindered by so-called tipping points in digital space; one example being digitised texts surpassing physical texts.

Companies need to ground their digital efforts in a distinct brand ethos or mission

The financial services sector is presently exhibiting a digital shift in its widespread adoption of cloud computing. The shift – while offering reduced costs, and a greater degree of flexibility and scalability – presents a number of barriers, in that extensive fail-safe procedures need to be instilled in order to maintain the protection of customer data.

Perhaps most unusual in these instances of digitisation are late adopters in the healthcare sector – unusual in that healthcare is an industry built upon person-to-person contact. So termed ‘digital healthcare’ is a discipline that has experienced a boom of late. It entails the use of digital information and communication in addressing health problems, or else in supplementing practitioners’ knowledge of health-related issues.

One example of a resulting digital solution is IBM’s artificial intelligence Watson, whose recent intake of medical documents is intended to aid the treatment of cancer. Watson will allow for a greater degree of control over a form of cancer called ‘lung adenocarcinomas’, an area in which doctors are known to offer the correct treatment recommendations only 50 percent of the time.

Jack West, MD of the Swedish Medical Centre in Seattle and an avid supporter of the project said: “A computer can incorporate a nearly infinite amount of new data coming out, while the human brain can’t attend to so much and integrate it.”

Watson’s introduction, as with similar cases of digital healthcare, is to be » implemented in accordance with a sector-wide digital strategy, as determined by a number of associated bodies. This process consists of: the identification of the healthcare problem; conducting research to inform the resulting solution; designing the digital means of counteracting the problem in question; evaluating the prototype solution and developing necessary changes; and the implementation and publication of the resulting innovation to aid those throughout the sector. Advances in digital healthcare are, in this instance, representative of digital strategy’s potential in aiding the internal processes and procedures of business.

The wisdom of crowds
Many businesses, having recognised social media as a powerful and growing phenomenon, have also acknowledged that many employees want to contribute more to a business by being permitted a greater share of information and responsibility. As such, a greater focus on transparency and on integrating separate departments is becoming an ever-more common factor in determining a digital strategy.

Decisive advancements in technology have made for a wealth of readily available and expertly catalogued resources. The digitisation of data and the accessibility of new analytics tools are significant means of progress over the flat and often opaque corporate structures of old.

The technological shift has entirely reconstituted the focus of corporations; they are now people-centric rather than process-centric bodies. Many of the leading organisations have allowed employees unprecedented access to records to help them better identify with the company.

Software such as HP’s TRIM Records Management System – capable of collating masses of physical and electronic information – ensures compliance with governance and regulatory obligations. This information is put to use spurring employee productivity.

Furthermore, so-termed ‘social software’ tools have more recently given businesses a means of acknowledging employees, whether merely in regards to increasing transparency or in allowing employees a greater say in executive decisions. The resulting digitisation of company data and the interlinking of departments has allowed for a more complex but more streamlined method of enterprise.

Many organisations are looking to gather together and aggregate an employee-wide perception of business in order to better their operations. They are, in effect, looking to widen corporate communication and to incorporate employee responses and recommendations.

Those looking to remove the existing barriers of internal participation are finding digital platforms an attractive means of gauging opinion, especially compared to the relatively primitive pastime of face-to-face interaction and paper questionnaires.

However, whereas most employ digital as a way to centralise communications or business processes, others have used it as a means of decentralising the enterprise. Book retailer Waterstones, for example, recognised each branch as being part of the community in which it was situated, and sought to allow each store a distinct identity and local relevance.

Each branch is permitted individual license in its decision-making processes, with Waterstones using digital as a means of unifying what could otherwise be a very convoluted business dynamic.

As more and more companies begin to recognise the far-reaching and decisive benefits of employing a digital strategy, so too will corporate culture shift accordingly. Whether companies develop an effective online strategy or utilise digital resources to aid company communication, digital looks set to reconstitute business as a primarily people-centric practice for the present and for the future.