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Digital Transformation: What it is and how to get there

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Digital Transformation: What it is and how to get there.

Authored by Econsultancy CEO Ashley Friedlein, this presentation on the topic of 'Digital Transformation', is broken down into six sections covering:

1. Digital Transformation - what it is and recent data and research on the topic

2. Strategy - what a digital strategy should include

3. Technology - the challenges of technology and the skills gap

4. People - looking at organisational structure, culture, roles & responsibilities, environment recquired

5. Process - how to address the speed, innovation and agility required

6. Business Transformation - how digital transformation is actually business transformation

Published in: Business, Technology
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Digital Transformation: What it is and how to get there

  1. 1. Digital Transformation: what it is & how to get there Ashley Friedlein, CEO, Econsultancy @AshleyFriedlein
  2. 2. NOTE: this presentation is licensed under Creative Commons (Attribution-NonCommercial-NoDerivs 3.0 Unported (CC BY-NC-ND 3.0)) Your are free to share, copy, distribute and transmit the work Editable PowerPoint version of this presentation, with commentary in the notes, and including builds, is available to Econsultancy subscribers on the Econsultancy site. | 2 | 2013 | Digital Transformation
  3. 3. About the author Ashley is the CEO and Co-founder of Econsultancy, a research and training group with over 200,000 subscribers. Econsultancy provides access to data, best practice guides, trends, training and events - all focused on improving digital skills and digital marketing and ecommerce effectiveness. Econsultancy was founded in 1999 and has offices in London, New York and Singapore. Ashley has written two books on digital marketing which have sold over 40,000 copies. He is a columnist for Marketing Week magazine and guest contributor to numerous other digital media and marketing publications. He writes for Econsultancy’s own award-winning blog and speaks at events internationally, actively promoting Econsultancy’s brand and content as well as the interests of digital and marketing professionals more generally. | 3 | 2013 | Digital Transformation Interested in Ashley presenting to you? Please see contact details on final slide
  4. 4. Contents  Digital Transformation  Strategy  Technology  People  Process  Business Transformation | 4 | 2013 | Digital Transformation
  5. 5. Digital Transformation | 2013 | Digital Transformation
  6. 6. What is Digital Transformation?  Digital Transformation is the journey from where a company is, to where it aspires to be digitally. | 6 | 2013 | Digital Transformation
  7. 7. What is a ‘digital’ organisation?  digital organisation is one that: A 1. Focuses on customer experience irrespective of channel 2. Has a ‘digital’ culture | 7 | 2013 | Digital Transformation
  8. 8. Net-a-Porter is a successful digital business. What do they obsess about? Customer Service Packaging “EIP”s | 8 | 2013 | Digital Transformation
  9. 9. Who is better at digital based on the packaging / unboxing experience? | 9 | 2013 | Digital Transformation
  10. 10. Amazon’s relentless focus on improving the customer experience Sources: Amazon, Oracle | 10 | 2013 | Digital Transformation
  11. 11. What is most impressive about Amazon? The digital part of the customer experience? Or the delivery? | 11 | 2013 | Digital Transformation
  12. 12. Perhaps most ‘transformative’ is where digital meets physical to enrich the customer experience | 12 | 2013 | Digital Transformation
  13. 13. *The* strapline for a digital organisation? | 13 | 2013 | Digital Transformation
  14. 14. What is a digital culture? Suggestion: Hire for culture / personality and not (just) digital skills. The latter can be taught. 1. Commercial 7. Empowered 2. Customer-centric 8. Data-driven 3. Transparent 9. Passion 4. Collaborative 10. Innovative 5. Environment 11. Agile 6. “Growth hacker” | 14 | 2013 | Digital Transformation
  15. 15. Perhaps you know you are digital / digitally transformed when…  No-one in your company has ‘digital, online, e-, interactive…’ in their job title  There is no separate ‘digital strategy’  Real-time retargeted dynamic online ads based on social profile data #whatever  Posters in the underground #howcoolisthat | 15 | 2013 | Digital Transformation
  16. 16. Econsultancy’s Digital Maturity Framework: roadmap to digital excellence Digital Excellence | 16 | 2013 | Digital Transformation
  17. 17. Success is down to leadership… Source: McKinsey Global Survey, August 2013 | 17 | 2013 | Digital Transformation
  18. 18. ..and organisational alignment Source: Econsultancy User Survey, Sept 2013 | 18 | 2013 | Digital Transformation
  19. 19. But only 1 in 10 marketing and IT executives believe collaboration between CMOs and CIOs is at the right level Source: The CMO-CIO disconnect: Bridging the gap to seize the digital opportunity, Accenture Interactive | 19 | 2013 | Digital Transformation
  20. 20. 33% see Digital Transformation as a ‘huge challenge’ Source: Econsultancy User Survey, Sept 2013 | 20 | 2013 | Digital Transformation
  21. 21. 27% of execs rate digital transformation as already “A Matter of Survival” Source: MIT Sloan Management/Capgmini, “Embracing Digital Technology”, 2013 | 21 | 2013 | Digital Transformation
  22. 22. “Executives estimate that at best, their companies are 25% of the way toward realizing the end-state vision for their digital programs” Source: McKinsey Global Survey, Aug 2013 | 22 | 2013 | Digital Transformation
  23. 23. How do you actually make it happen at scale, across the whole organisation? 1. Create the right environment for ‘osmotic’ digital transformation  Incentivising the right behaviours  New blood/digital natives  Show/prove the value of digital to all  Digital culture 2. LEAD the transformation  CEO should own/drive this | 23 | 2013 | Digital Transformation
  24. 24. "Demand is growing for insight into digital business, particularly among CEOs” Source: Diane Morello, managing vice president, Gartner, 2013 | 24 | 2013 | Digital Transformation
  25. 25. "31% say their CEOs personally sponsor these [digital] initiatives, up from 23% who said so in 2012. [...] the CEO is the only executive who has the mandate and ability to drive such a cross-cutting program.” Source: McKinsey Global Survey, Aug 2013 | 25 | 2013 | Digital Transformation
  26. 26. Jez Frampton, Global CEO, Interbrand, on x-channel experiences + importance of executive/CEO support (00:46 - 01:20) | 26 | 2013 | Digital Transformation
  27. 27. Strategy | 27 | 1 Feb 2010 2013 LV= Strategy Day, Econsultancy Presentation | Digital Transformation
  28. 28. What should be in a Digital Strategy? (1) Strategy •Make it clear how the digital strategy supports the overall business strategy. •Business plan/P&L for digital as necessary. •Articulate short, medium and long term plan/vision for digital. For example it may well be that in the long term the objective is that ‘digital’ will dissolve back into the business so structures, roles, P&Ls etc will change over time. •Define digital principles and digital design principles. Focus should be user- centred design and customer experience •Define “what good looks like” for digital: KPIs, success metrics, what analytics/reporting are planned | 28 | 2013 | Digital Transformation
  29. 29. What should be in a Digital Strategy? (2) People/Process •Digital governance: who makes decisions and how? Who are the leaders for digital? •Structure: organisational design, teams, roles and responsibilities for digital •Culture for digital: define how you plan to work (agile, iterative), your planned environment, your values e.g. sharing, transparency, collaboration •Training, education, empowerment, integration of digital across the business. Articulate how you plan to bring digital to the whole business, break down knowledge, and other, silos. | 29 | 2013 | Digital Transformation
  30. 30. What should be in a Digital Strategy? (3) Tech/Ops •Your plans around content, community, commerce •Digital tech: infrastructure, architecture and ecosystem inc. points of integration across business •Data: metadata, taxonomy, integration with rest of business and systems e.g. CRM, sales •Tech Standards: standards/protocols you intend to use/comply with •Legal: data protection, privacy, IP/rights policies, licences etc. •Procurement: define who is in charge of digital tech and agency procurement/selection (should be digital specialists) •Define tools/environment the digital team will require to do their jobs effectively | 30 | 2013 | Digital Transformation
  31. 31. What should be in a Digital Strategy? (4) Marketing/Sales •Plans/resourcing around customer lifecycle: customer acquisition, conversion, retention (including online customer service) •Address plans around digital marketing fundamentals: advertising, email / eCRM, content marketing, social, mobile, search marketing, customer experience, analytics/optimisation | 31 | 2013 | Digital Transformation
  32. 32. Tate’s digital strategy evolution Source: Tate website | 32 | 2013 | Digital Transformation
  33. 33. GOV.UK digital & design principles | 33 | 2013 | Digital Transformation
  34. 34. Technology | 2013 | Digital Transformation
  35. 35. Even politics has experienced the rise of tech • Obama’s 2008 presidential campaign team had 4 engineers working on it • Obama’s 2012 campaign team had a team of how many engineers? 40! | 2013 | Digital Transformation
  36. 36. By 2017 the CMO will spend more on IT than the CIO Source: Gartner, 2013 | 36 | 2013 | Digital Transformation
  37. 37. 66% strongly agree that: Marketing is becoming increasingly technology-driven Source: Econsultancy User Survey, 2013 | 37 | 2013 | Digital Transformation
  38. 38. Most future disruptive technology relates directly to digital business transformation Source: McKinsey Institute, “Disruptive technologies: Advances that will transform life, business, and the global economy” | 38 | 2013 | Digital Transformation
  39. 39. However… although 90% of professionals say tech impacts their job, only 20% have the right skills Source: Research for Digital Domination Summit 2012 (2,000 professional respondents) | 2013 | Digital Transformation
  40. 40. *Which* technology is much less important than organisational alignment with IT “Marry the technologists” | 40 | 2013 | Digital Transformation
  41. 41. People | 2013 | Digital Transformation
  42. 42. Structure | 42 | 2013 | Digital Transformation
  43. 43. Stage 1: Let many digital flowers bloom… BBC 1997-2001 Source: Econsultancy’s Digital Marketing: Organisational Structures and Resourcing Best Practice Guide | 43 | 2013 | Digital Transformation
  44. 44. Stage 2: Dedicated Digital Team / CoE BBC 2001-2006 Source: Econsultancy’s Digital Marketing: Organisational Structures and Resourcing Best Practice Guide | 44 | 2013 | Digital Transformation
  45. 45. Stage 3: Hub & Spoke BBC 2007-2012 Source: Econsultancy’s Digital Marketing: Organisational Structures and Resourcing Best Practice Guide | 45 | 2013 | Digital Transformation
  46. 46. Stage 4: Multiple Hub & Spoke BBC 2012 Source: Econsultancy’s Digital Marketing: Organisational Structures and Resourcing Best Practice Guide | 46 | 2013 | Digital Transformation
  47. 47. Digital Enlightenment = “Honeycomb” | 47 | 2013 | Digital Transformation
  48. 48. Culture | 48 | 2013 | Digital Transformation
  49. 49. Culture is one of the most significant barriers to digital transformation Source: MIT Sloan Management/Capgmini, “Embracing Digital Technology”, 2013 | 49 | 2013 | Digital Transformation
  50. 50. What is a digital culture? (recap) 1. Commercial 7. Empowered 2. Customer-centric 8. Data-driven 3. Transparent 9. Passion 4. Collaborative 10. Innovative 5. Environment 11. Agile 6. “Growth hacker” | 50 | 2013 | Digital Transformation
  51. 51. Nordstrom: “What we want in a teammate” “Customer-driven” “Constantly changing” “Collaborative” “Curiosity” “Passion” “Always learning” | 51 | 2013 | Digital Transformation
  52. 52. Roles & Responsibilities | 52 | 2013 | Digital Transformation
  53. 53. “Pi-shaped” people: broad skills but depth in creative / marketing AND tech / data (left and right brain) T | 53 | 2013 | Digital Transformation
  54. 54. Growth Hacker • From Silicon Valley • Combines marketing with product development • About getting to points of sustainable growth with new products/services • AirBnB case study: Growth Hacker is the new VP Marketing | 2013 | Digital Transformation
  55. 55. Product Manager Source: Mind the Product | 55 | 2013 | Digital Transformation
  56. 56. One way to do it... from CIO to CMO Ali Hine CIO CMO, IG Group | 56 | 2013 | Digital Transformation
  57. 57. To CDO or not to CDO? “30% of respondents have a CDO. [those with a CDO] indicate significantly more progress toward their digital vision than those without one” McKinsey Global Survey, 2013 Suggestion: CDO should be an interim role. CDO should report to CEO. Source: Econsultancy | 57 | 2013 | Digital Transformation
  58. 58. New job descriptions for HR to understand Source: Econsultancy | 58 | 2013 | Digital Transformation
  59. 59. How do you attract top digital talent?  Digital vision – a clear strategy and the opportunity “to make a difference”  Product – the chance to create a beautiful product / experience  Talent begets talent - get to work with other talent, digital ‘craft’  Culture - you have a digital culture (see earlier) | 59 | 2013 | Digital Transformation
  60. 60. Environment | 60 | 2013 | Digital Transformation
  61. 61. BBC W1 – tech + editorial together | 61 | 2013 | Digital Transformation
  62. 62. BBC Salford, Google London – open / collaborative / ‘ad hoc’ spaces Space echoes working practices: small, rounded teams; fluid / agile; mixing 2013 disciplines; no hierarchy. | 62 | | Digital Transformation
  63. 63. Process | 2013 | Digital Transformation
  64. 64. Four big challenges for digital / process 1. Multi-disciplinary 2. Speed / Agility 3. Complexity 4. Innovation | 64 | 2013 | Digital Transformation
  65. 65. How we need to work “A successful digital culture is reliant on innovation, openness and responsiveness.” Rachel Neaman, Department of Health, Deputy Director, Digital, Channel Strategy and Publishing “Being able to change at speed is very important. We know government can move quickly because we built the new e-petitions system in less than 2 months.” Sharon Cooper, Government Digital Service, Cabinet Office, Deputy Director “Transformation means a change in culture and process in order to deliver change and make sure that we are seen by our customers to be innovating and moving forward.” Simon Shorey, Barclays, Head of Development, UK Retail and Business Banking | 65 | 2013 | Digital Transformation
  66. 66. Multi-disciplinary: Amazon’s “two pizza” teams + co-located + manage by objectives / “freedom within boundaries” | 66 | 2013 | Digital Transformation
  67. 67. How do we deal with the need to operate at SPEED?! Real time On demand Agile Responsive Automation | 2013 | Digital Transformation
  68. 68. Agile – for software development Manifesto for Agile Software Development We are uncovering better ways of developing software by doing it and helping others do it. Through this work we have come to value: Individuals and interactions over processes and tools Working software over comprehensive documentation Customer collaboration over contract negotiation Responding to change over following a plan That is, while there is value in the items on the right, we value the items on the left more. | 68 | 2013 | Digital Transformation
  69. 69. Agile – for marketing | 69 | 2013 | Digital Transformation
  70. 70. Nordstrom Innovation Lab | 70 | 2013 | Digital Transformation
  71. 71. Speed is a vital source of competitive advantage in digital | 71 | 2013 | Digital Transformation
  72. 72. Google’s USP has always been speed? | 72 | 2013 | Digital Transformation
  73. 73. From mere fast to Now. Predictive. Push. | 73 | 2013 | Digital Transformation
  74. 74. iOS7’s “background refresh” – improving the speed / responsiveness of the user experience “more recent information... content fresh and ready... no need to wait... massive improvement in customer experience” Eventbrite, Yplan, Realmac | 74 | 2013 | Digital Transformation
  75. 75. 1-3 days: if a video is to go viral Source: Unruly “Science of Sharing”, July 2013 | 75 | 2013 | Digital Transformation
  76. 76. < 6 hrs: half your email opens occur Source: Mailer Mailer | 76 | 2013 | Digital Transformation
  77. 77. < 3hrs: 50% of clicks on shared links Source: bit.ly | 77 | 2013 | Digital Transformation
  78. 78. 00:01 – Twitter is ‘Marketing in the Moment’ | 78 | 2013 | Digital Transformation
  79. 79. The Stalagmite vs. the Conductor | 79 | 2013 | Digital Transformation
  80. 80. Business Transformation | 80 | 1 Feb 2010 2013 LV= Strategy Day, Econsultancy Presentation | Digital Transformation
  81. 81. The rate of change is accelerating at a business level too “The average lifespan of an S&P 500 company has decreased by more than 50 years in the last century, from 67 years in the 1920s to just 15 years today” Source: Professor Richard Foster, Yale University | 81 | 2013 | Digital Transformation
  82. 82. “By 2020, more than threequarters of the S&P 500 will be companies that we have not heard of yet.” Source: Professor Richard Foster, Yale University | 82 | 2013 | Digital Transformation
  83. 83. The journey towards digital excellence Source: Econsultancy Digital Maturity Framework | 83 | 2013 | Digital Transformation
  84. 84. Burberry – doing well because of ‘digital transformation’? Source: The Digital Advantage: How digital leaders outperform their peers in every industry, CapGemini / MIT Sloan Management | 84 | 2013 | Digital Transformation
  85. 85. Digitally-transformed busineses outperform their peers in every industry Profitability Source: The Digital Advantage: How digital leaders outperform their peers in every industry, CapGemini / MIT Sloan Management | 85 | 2013 | Digital Transformation
  86. 86. Digital Transformation is actually Business Transformation | 86 | 2013 | Digital Transformation
  87. 87. Digital Transformation with Econsultancy We can measure your organisation’s digital capabilities so you know where you are. This is the baseline against which improvement can be measured and benchmarked, both internally and versus the market. We deliver digital capability programs via training and workshops both face to face and online. These accelerate the adoption and integration of the digital skills needed to deliver on digital transformation. Talk to us about an initial, no-cost consultation. Call us on +44 (0)20 7269 1450 (UK) or +1 212 971-0630 (US) or email transformation@econsultancy.com | 87 | 2013 | Digital Transformation Editable PowerPoint version of this presentation, with commentary in the notes, and including builds, is available to Econsultancy subscribers on the Econsultancy site.

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