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© Marko Luhtala 2016
Click to edit Master title style
Thoughts on digitalization
WHAT I HAVE LEARNED IN 17 YEARS
August 20...
© Marko Luhtala 2016
Personal journey in digitalization
2
Early adopter
eBusiness director at Nokia, 1999–2002
Solution pr...
© Marko Luhtala 2016
Discussion topics
What digitalization means in my view
How I saw a hype turn into
industry transforma...
© Marko Luhtala 2016
What digitalization means
in my view
© Marko Luhtala 2016
What digitalization means in my view
Digitalization means applying digital technology to improve
your...
© Marko Luhtala 2016
How I saw a hype
turn into
industry transformation
© Marko Luhtala 2016 7
First digital faceoff was almost
20 years ago
DOT-COMS
versus
BRICK’n’MORTARS
© Marko Luhtala 2016
© Marko Luhtala 2016
Ever since, it has been a rocky road…
8
…causing headache and opportunities to many
– including me
Do...
© Marko Luhtala 2016
eCommerce
Online payment
SaaS
Real-time
24/7
Global
On-demand
Market places
NEW BUSINESS MODELS
Digit...
© Marko Luhtala 2016
Half-a-dozen reasons why digital services are
attractive
10
>90% of potential
customers can access
yo...
© Marko Luhtala 2016
World is already a different place
11
Finland’s biggest corporate
tax payer is a 200-people
mobile ga...
© Marko Luhtala 2016
Customer is sitting on
the driver’s seat
© Marko Luhtala 2016 13
Customers are already digital
and mobile
99% of Finns under 55 and
76% of Finns over 55 use
Intern...
© Marko Luhtala 2016
I believe there is more to come in
online commerce
14
Where do customers shop?
YESTERDAY
Brick’n’mort...
© Marko Luhtala 2016 15
Because expectations have
radically changed
”People should go from
wanting to buying in 30 seconds”
© Marko Luhtala 2016
It is not online or offline,
but omnichannel
16
eCommerce is growing fast but 90% of
retail sales sti...
© Marko Luhtala 2016
Not everything is going digital
17
Role of human touch and physical retail stays e.g. in:
Large clien...
© Marko Luhtala 2016
Don’t let technology
take over the customer!
© Marko Luhtala 2016
A million has become a thousand
19
2000 2016
Technology has become faster, easier and cheaper
Respons...
© Marko Luhtala 2016
Leading to an explosion of offering
20
As a result, consumers and businesses are
suffering from techn...
© Marko Luhtala 2016 21
However, customer experience is more important
than features
iPhone vs. Symbian Google vs. Yahoo
W...
© Marko Luhtala 2016
Best digital business cases
22
Best digital business cases globally
are from innovations in:
Not late...
© Marko Luhtala 2016
Five points to consider
for a CEO
© Marko Luhtala 2016 24
SOURCE
McKinsey study
1. Digitalization is about business
not IT
75% of CEOs consider growth
as th...
© Marko Luhtala 2016 25
SOURCE
CMO Council survey
On average,
60% of a marketer’s time is devoted to
digital marketing act...
© Marko Luhtala 2016 26
3. Digitalization challenges the
company culture
Typical hurdles in digital transformation:
Lack o...
© Marko Luhtala 2016
4. The speed of innovation is
increasing
27
Current and emerging trends:
Big Data
Predictive
Marketin...
© Marko Luhtala 2016 28
3-5 years to make digital business-as-
usual
from the customer interface but cuts
across the organ...
© Marko Luhtala 2016
The magnitude of impact of digitalization should not
be underestimated
29
Market positions will be re...
© Marko Luhtala 2016
SEASONED DIGITAL EXECUTIVE
marko@luhtala.com
+358-50-3879903
MARKO LUHTALA
NEED HELP IN DIGITAL STRAT...
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Thoughts on digitalization

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What have I learned about digitalization in 17 years. Personal journey to digitalization in different roles ranging from early adopter to solution provider. How I saw digitilization turn from a hype to an industry transformation. Enjoy!

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Thoughts on digitalization

  1. 1. © Marko Luhtala 2016 Click to edit Master title style Thoughts on digitalization WHAT I HAVE LEARNED IN 17 YEARS August 2016 MARKO LUHTALA
  2. 2. © Marko Luhtala 2016 Personal journey in digitalization 2 Early adopter eBusiness director at Nokia, 1999–2002 Solution provider Sales director/Enterprise solutions at Nokia, 2002– 2005 User of digital technology widely in commerce Director/ VP of Retail at Nokia, 2006–2010 Solution provider, SaaS-entrepreneur CEO at NearMe Services, 2010–2016 MARKO LUHTALA © Marko Luhtala 2016
  3. 3. © Marko Luhtala 2016 Discussion topics What digitalization means in my view How I saw a hype turn into industry transformation Customer is sitting on the driver’s seat Don’t let technology take over the customer! Five points to consider for a CEO
  4. 4. © Marko Luhtala 2016 What digitalization means in my view
  5. 5. © Marko Luhtala 2016 What digitalization means in my view Digitalization means applying digital technology to improve your business. At the dawn of eBusiness we talked about “doing business with e”. Digitalization can be used in communicating, interacting and transacting with your customers, suppliers and employees. Media can be smartphone, tablet, computer, digital display and kiosk, or other similar devices. The purpose is not to digitize everything but to use it where it makes sense, which is quite often. All industries will be impacted and many disrupted. While digitalization is by default about technology, it has big impact in processes, organization, skills, KPIs, leadership and many other areas of the business. 5
  6. 6. © Marko Luhtala 2016 How I saw a hype turn into industry transformation
  7. 7. © Marko Luhtala 2016 7 First digital faceoff was almost 20 years ago DOT-COMS versus BRICK’n’MORTARS © Marko Luhtala 2016
  8. 8. © Marko Luhtala 2016 Ever since, it has been a rocky road… 8 …causing headache and opportunities to many – including me Dot-Com hype Early adopters burn their fingers Explosion of digital devices & use of Internet Businesses underinvest in digital Digital tsunami hits many industries 1996 2006 2016 Radical change in customer behaviour
  9. 9. © Marko Luhtala 2016 eCommerce Online payment SaaS Real-time 24/7 Global On-demand Market places NEW BUSINESS MODELS Digitalization offers wide and deep opportunities 9 Examples of how I have used digitalization in business: Online sales & marketing Personalizing and customizing Targeted advertising Marketing automation Online support & self- help Online communication Social networks Interactive engagement CUSTOMER INTERFACE Internal communication Recruitment Supplier management Automated and fail-safe processes Online KPIs and reporting Remote teams Field force management Increasing management clock speed INTERNAL EFFICIENCY
  10. 10. © Marko Luhtala 2016 Half-a-dozen reasons why digital services are attractive 10 >90% of potential customers can access your services at home, at work, on the move or anywhere Reachable Like a dream employee – lightning fast, same output every time Fast and consistent You can offer digital service relatively easily to millions or even billions of people Scalable 24/7 is not a problem – bits never sleep Available You can track all events with a great detail Measurable Often 10x or 100x efficiency gains are reported comparing digital to current processes Effective
  11. 11. © Marko Luhtala 2016 World is already a different place 11 Finland’s biggest corporate tax payer is a 200-people mobile games company Supercell Alibaba, a Chinese ecommerce company, features close to 1 billion products and has a sales record of 14BUSD in one day 90 million people follow Katy Perry, a pop singer, in social media And by the way, you don’t need to get lost again, ever 100 million people chase cartoons on the streets in summer 2016
  12. 12. © Marko Luhtala 2016 Customer is sitting on the driver’s seat
  13. 13. © Marko Luhtala 2016 13 Customers are already digital and mobile 99% of Finns under 55 and 76% of Finns over 55 use Internet for personal purposes. Source: Consumer barometer with Google Internet use is pervasive across all age groups 60% of Finns use smartphone equally or more often than computer to access Internet. Source: Consumer barometer with Google For most people, Internet access is smartphone-centric
  14. 14. © Marko Luhtala 2016 I believe there is more to come in online commerce 14 Where do customers shop? YESTERDAY Brick’n’mortar store TODAY Online store Brick’n’mortar store Mobile commerce turns any physical surrounding to a point- of-sales TOMORROW Online store Brick’n’mortar store Bus stop Display window Product catalogue
  15. 15. © Marko Luhtala 2016 15 Because expectations have radically changed ”People should go from wanting to buying in 30 seconds”
  16. 16. © Marko Luhtala 2016 It is not online or offline, but omnichannel 16 eCommerce is growing fast but 90% of retail sales still takes place in physical stores Every fourth shopper searches products on mobile, visits store to see the product and ends up buying online Customers mix the use of mobile, computer and stores in their path to purchase Over 50% of Google searches are done on mobile devices Over 80% of shoppers consult their phones on purchases they're about to make in a store. At the same time the role of mobile is rapidly increasing
  17. 17. © Marko Luhtala 2016 Not everything is going digital 17 Role of human touch and physical retail stays e.g. in: Large client account management Retail sectors with high-touch sales or non- standard products Premium customer service Shopping malls that are turning into leisure centers
  18. 18. © Marko Luhtala 2016 Don’t let technology take over the customer!
  19. 19. © Marko Luhtala 2016 A million has become a thousand 19 2000 2016 Technology has become faster, easier and cheaper Responsive design Open source Cloud SaaS EXAMPLE: Setting up an online store. COST TIME TO MARKET YEAR 1M USD 10 months 1000 USD 10 days
  20. 20. © Marko Luhtala 2016 Leading to an explosion of offering 20 As a result, consumers and businesses are suffering from technology overdose Millions of consumer apps Thousands of business software Tens of thousands of technology providers 2012 2016YEAR 350 1950Number of companies listed in annual Marketing Technology Landscape
  21. 21. © Marko Luhtala 2016 21 However, customer experience is more important than features iPhone vs. Symbian Google vs. Yahoo Winners make user experience intuitive and simple regardless of the underlying complex technology
  22. 22. © Marko Luhtala 2016 Best digital business cases 22 Best digital business cases globally are from innovations in: Not latest technology customer-centric services and processes
  23. 23. © Marko Luhtala 2016 Five points to consider for a CEO
  24. 24. © Marko Luhtala 2016 24 SOURCE McKinsey study 1. Digitalization is about business not IT 75% of CEOs consider growth as the main intent behind digital programs
  25. 25. © Marko Luhtala 2016 25 SOURCE CMO Council survey On average, 60% of a marketer’s time is devoted to digital marketing activities 2. Digital is already impacting the organization
  26. 26. © Marko Luhtala 2016 26 3. Digitalization challenges the company culture Typical hurdles in digital transformation: Lack of understanding of digital business models and business cases Lack of digital talents Inflexible organization and processes Data is too fragmented and of poor quality for decision making Culture does not support “experimental or start-up mindset”
  27. 27. © Marko Luhtala 2016 4. The speed of innovation is increasing 27 Current and emerging trends: Big Data Predictive Marketing Personalized Customer Experience Artificial Intelligence Internet of Things Waiting does not pay off! …in digital technology, processes and business models
  28. 28. © Marko Luhtala 2016 28 3-5 years to make digital business-as- usual from the customer interface but cuts across the organization and processes a senior leader to see through the transformation, typically a Chief Digital Officer is appointed 5. Digitalization is a transformation process TAKES STARTS NEEDS
  29. 29. © Marko Luhtala 2016 The magnitude of impact of digitalization should not be underestimated 29 Market positions will be redistributed in the coming years Industry leaders may fall, challengers rise and new entrants become leaders.
  30. 30. © Marko Luhtala 2016 SEASONED DIGITAL EXECUTIVE marko@luhtala.com +358-50-3879903 MARKO LUHTALA NEED HELP IN DIGITAL STRATEGIES AND EXECUTION?

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