Think about a world where the first interaction a customer has with your organisation is via a small screen – smartphone, phablet, smartwatch or similar. How are you going to give, via that small entry point, an experience that is expansive, engaging, meaningful and rewarding – to your organisation and to the customer? That's the challenge that the 'digital transformation' strategists wrestle with. And reading between the lines of the Altimeter report The 2014 State of Digital Transformation it is not plain sailing. They define digital transformation as 'the realignment of, or new investment in, technology and business models to more effectively engage digital customers at every touchpoint in the customer experience lifecycle'. They surveyed 59 organizations on the topic and found that although 88% of respondents say they are digitally transforming 'the details of their efforts report the contrary … digital transformation as an integrated and official endeavor is something many strategists are truly just beginning to understand and pursue.'
What digital transformation seems to require is a totally rethought business model, focused on customer centricity and a 'frictionless customer experience', accompanied by a complete organization redesign that includes:
- improving processes
- updating websites and ecommerce programmes
- integrating all social, mobile, web, ecommerce, service efforts and investments
- updating customer-facing technology systems
- researching customer touch points, building competitive social media channels
- creating an executive sense of urgency that this is the way to go
- overhauling customer service.
I was reading the report when I realized I'd left at home a connector I need to connect my laptop to a monitor. I'm now away for the week: so an immediate test of John Lewis's multi-channel strategy. Could I buy the connector from them and get it next day? I chose John Lewis a) because I've read a lot about their digital strategy and b) because they have a Waitrose close to where I am so I could click and collect. They fell at the first post because they don't have a BlackBerry app to enter their portal. But maybe I should abandon my Q10 BlackBerry and get an app heavy competitor smartphone. I am continuously getting ribbed by colleagues on my customer loyalty. Getting side-tracked on this idea I saw T-Mobile tried to get customers to switch to an i-phone by offering a financial incentive. Back to the task and undaunted, I switched to my small screen tablet, entered the John Lewis website, ordered the item, gave my mobile phone number so I get an alert when it is ready to collect tomorrow, so all is well so far. Was it painless and seamless? Yes – assuming the connector arrives tomorrow as promised.
Looking at the John Lewis digital transformation history which began around 2008 it's clear that it has been a long and well thought through journey. They make the investments, line up the organization design behind the omni channel business model, and keep a close eye on their customers' buying patterns. They have seen a surge in on-line sales via the 'small screen'. Mark Lewis, online director at John Lewis in January 2014 reported that they 'had enjoyed a strong Christmas, with online sales up by 22.6% in the five weeks to the end of December. "Online now accounts for around 30% of overall sales, up from 25% in 2012," he said. "Two stand-out milestones for us were the 61.8% rise in Click & Collect orders and a shift to traffic from mobile devices making up over half of traffic to johnlewis.com.'
It is likely that buying through smartphones will continue to grow: as of January 2014 58% of American adults had a smartphone. In the UK it was 68% of adults with 32% of them each month making on-line purchases via the smartphone. Retailers that have a weak online/small screen presence are losing out to those who have a strong presence. Take a look at Morrisons, for example.
But what about non-retail organizations – should they work to the same premise that the way their customers, clients, patients, or whoever interact with them is through the small screen? The sensible answer to this is yes. A July 2014 report noted that 80% of consumers were open to healthcare interactions via smartphones, "The way health care organizations communicate with people is changing, as individuals become more and more sophisticated about using information technology to make health-related decisions," said Stuart Wells, FICO's chief product and technology officer. "People are especially interested in mobile services that can help them manage their personal health and shop for health care services. The leading health care providers are increasingly turning to mobile technologies to meet this demand, and to engage frequently and proactively with consumers."
Similarly the agriculture sector is a big user of smartphone apps to monitor farm performance and to get/give information. The Nosho Navi project in Japan is one such example: rice farmers feed information via smartphone and a cloud server to a research centre and get advice on how much water they should apply to the crop and when in order to improve yield and quality. Partnering in this enterprise is Fujitsu which is predicting a 'green future in cloud-based veggies'
You can see government interest in smartphone/mobile based interactions with citizens is also increasing rapidly. A recent article (July 31 2014) discusses the way US state and local government is getting to grips with it. And it's not an easy task. "All these different devices cause support issues, security issues, etc. It's moving faster than perhaps a lot of places can comprehend or manage. It's going to be a continually evolving process. But mobile is here to stay, and you have to work with it."
Given that smartphone and other mobile devices are here and the number of users is increasing daily (look at an infographic here) what should organisations do to keep up or catch up? Already mentioned are the three main things:
- Have a well thought through digital transformation strategy, remembering that 'small screen' is increasingly likely to be the first customer touch point
- Rethink your business model
- Redesign your organization to deliver the business model
Beyond that are a number of things that support the transformation effort: none of them, in my view, specific to digital, but all necessary if that's what you're aiming for. The more structural ones are neatly summarized in the MIT piece The Nine Elements of Digital Transformation while the more cultural ones are discussed in 10 Principles of Leading Change Management.
However, although in the work I'm involved in we're doing many of the things advocated in this type of guidance to get the organization digital, mobile and/or small screen, we are finding that alongside the orthodoxy of the 'how to' we are in practice, also muddling through the day to day challenges, balancing trade-offs, handling the politics, bridging the say-do disconnects, managing our own different perspectives, and so on. Someone suggested we write a handbook on the way it really is to get to digital transformation. We could even develop a small screen app for it. Would that be helpful? Let me know.