In our previous blog, we briefly considered the general concept of disruption and what it could mean to your business. Continuing from this, one of the closely related considerations would be an understanding of what a Digital (Transformation) Strategy is (DTS), and why this is a necessary factor to include in running your business. A mere mention of the term and even the very meagrely informed might well make connotations with other related concepts such as ‘transformation’, ‘moving with things’, ‘not being left behind’, and so forth. At its base – as always – there an implicit and mostly unchallenged understanding for most that DTS always is also about change. This, it seems, is the truth that will prevail for Technology as we know it and the impact it has had on all of us. Running a business, it would seem, is in no way exempt from this.
So, what is this known and not known DTS concept all about?
It would seem that the word ‘Digital’ is the term that grabs all the attention, even in research and more sophisticated work done on DTS’s and what it all is about. A deep and thorough study on the topic will provide a very broad spectrum of content with quite a bit of it discrepant, and a scholar of such an orientation will most likely tell you that there is not one truth to punt when it comes to DTS’s. However, a broadly unified and agreed on point might well be that it is, if nothing else, a strategy as is obvious from the term we have given the idea. However, this is often overlooked and therefore the most obvious points might well be poorly integrated when it comes to getting one’s head around the idea of a DTS and how to go about bringing this about in your own business.
Six Points to bring about a DTS understanding of your business
Below we offer 6 key points to think about when embarking on bringing into being your own DTS for your business. These are, by no means, encompassing of all thought around the topic but might prompt further investigation and thinking about it so that readers are able to better navigate and structure their own views and thoughts on the topic:
It is true that this claim is not likely to result in the winning of a Nobel Prize for any category – it is stating the obvious. But what this explicit acknowledgment does is to position the topic in a structure that expects a certain way of thinking, with a particular reason or goal in mind. Again, the world of strategy is very diverse and there is no single truth or way of understanding how to draw up and implement a strategy in a business. In fact, many people that have a great ability to come up with and implement winning strategies and create highly successful business ventures around it, will guard their ways of work and true methods as closely as they would the trademarked and patented formulas and technologies that might create their winning products. Their ‘game plan’ is highly unique and tailored to provide them with a winning approach to the market in which they operate, and hence the secrecy with which they shield this knowledge. But this suggests two simple concepts around what it means to be a strategy: i) it is about having a deep (often intuitive) understanding of knowing the market in which you play, and ii) it is about knowing how to win in that market.
That’s it – the game plan which provides the business with the direction and outcomes to win in a market where the value created by that business is consumed above other players in that same environment is what it’s all about. You would do well to call this ‘strategy’. Nothing more is really required to grasp this, except perhaps to also be comfortable with the conviction that this also means that, because markets, consumers and indeed the world changes all the time, so too must your strategy. A gameplan that does not speak to the game, is of no use. So your strategy must consistently be focussed on making sure that you win in the present world as it is, not the past world when your strategy was crafted. That’s it. In keeping with this simplicity, this means that your strategy about how technology will play a part in this – your DTS – must also achieve this on the topic of the role that tech will play in your business, and how to make sure that what you think you’re buying is actually working like that in your organisation. If business owners and captains of organisations can master this, they will have a fully-fledged DTS.
Important to understand is that a good DTS strategy and a good overall Business Strategy must conform to the same principles mentioned above, in other words, be clear on where you play and how you win. This means that a thorough grasp, backed by facts and research, must be at hand to understand the market and the competition. Who you are up against will be a key factor in knowing how you measure up and where gaps are for exploiting to gain a competitive advantage. This can sometimes be quite complex in scenario’s where the market is not clearly defined, or where the offering or products of competition cuts across (sometimes different) lines and markets of various kinds. Doing your homework will be necessary to position yourself optimally.
It is easy to get carried away in any strategic session. Too often, executives or teams are herded to the all-too-familiar breakaway sessions, only to come back with fanciful and fantastical intentions of grandeur – but only fluff, really. If no analysis was done and the strategic intent is not clear on the points mentioned, as well as easy for all to understand and to operationalise, then it’s either very poor or not a strategy at all. This lack of clarity and clear strategy has many impacts such as eroding staff morale and wasting opportunity, eventually falling behind in the market. So it is key that alignment is achieved between all relevant factors:
Following from the above, it is important that you understand what to exploit in your organisation by way of assets, so that you invest in the correct development aspects. The cost-and-benefit work done to understand the investments you have to make must contain the required insight into the cost to develop your business competencies and strengths versus the expected benefit by gaining market position or growth in share. And above all remember that the prevailing research and insight into the topic of organisational strength and ability to remain competitive and relevant in any market for any business, is looking after your key asset and using and growing it as well as you can: that asset, is your people. Without this, organisational growth and adaptation will not be possible.
The world has many less than ethical practices, and the world of the snake oil salesman is sadly common. This is also true for the world of technology. When understanding what technical capabilities and solutions you might require, you have to be knowledgeable enough about all aspects of the technology you select: this includes its longevity and ability to remain relevant as it ages and the world and your business changes and grows (future-proofing it), the commercial cost elements to owning it, as well as the more technical elements such as failures, support, and risk factors for owning and running it. Also, get a sense of the competitor’s products and try and get a clear view of how other businesses are using and finding it. Finally, understand the core functionality and how far you can stretch the functionality of the technology solution outside of its current set. Also consider re-using what is already at your disposal, and make your own cost savings calculations based on real-time demonstrations of the solutions and tools, rather than taking what is said verbatim. Following on from people as your most valuable resource, lean into and use your talent well. Nothing can substitute for good tech knowledge, background and experience of people when needing to do technology evaluations and creating a plan for which solutions you want to purchase.
Although related to the above point, it is kept separate because so much can go wrong specific to this consideration, which could render your whole investment wasted and cause damage to your current business model. When looking at bringing in new technology, whether it be a relatively simple standalone solution or a more complex piece that has to integrate into an existing complex technology ecosystem, it is important to understand what will be needed to bring the solution into your business. To what extent must custom development (and its cost and timelines and viability) be done first, how will it integrate into existing tech, and what are the implications for people to be able to embrace it and use it well, assuming that it adds value to their work-life also. In addition, it is critical to have certainty that you will not be left to your own devices during the implementation phase by the vendor and that you are not biting off more than your organisational change capacity can accommodate.
If you have considered the above six points, and have a sense of control that you feel confident in all aspects, you are well down the path of creating a list or plan of technology solutions that you can consider as a strategic enabler to achieving your general organisational strategic objectives.