Showing posts with label ecommerce. Show all posts
Showing posts with label ecommerce. Show all posts

The Mindset of a Digital Winner


I recently presented my views on how to succeed as a digital leader to over one hundred retail executives in Asia.  They seemed to find it useful, so now I am sharing them here in an article format in the hopes that others might benefit.  The content is my synthesis of findings that are derived from many different research projects and hundreds of interviews I have conducted with executives.

Digital winners think differently about digital innovations.  They quickly recognize how new innovations can offer benefits. They expect and look forward to finding and capturing competitive advantages in new trends and technologies.  They expect, at a higher level, to receive positive ROIs from their investments in new innovations.  They are both more optimistic and enthusiastic about emerging technologies and possibilities.  They are honest about their digital maturity, and where they are failing to keep up with change.

Digital laggards, on the other hand, are slower to understand how new digital innovations might be useful.  They often suffer from normalcy bias.  They often underestimate the amount of change that is occurring in their industry and with their customers.  As a result, they underestimate the amount of work and resources they need to invest in order to keep up with the cadence of change. They are reluctant to invest in new technologies, fearful of making the wrong moves, and they believe they can delay action today and catch up with digital leaders in the future.

It is fascinating how much the mindset of leaders determine whether a company will be successful or not.  More than products, services, technology platforms, funding, talent, ambition and creativity - it's mindset that often has the biggest impact.

Digital winners in retail watch for emerging and moving customer interaction points where they can meet with and address the needs of their customers.  These interaction points are constantly on the move.  In recent years we have watched them move from brick and mortar stores to websites, mobile  apps and then on to social media sites, podcasts, YouTube, TikTok and other digital influencer-oriented sites.  Digital winners will be where their customers are moving.

The future is too complex to predict accurately, so digital winners invest in understanding and anticipating a range of possible future scenarios.  Digital leaders will then develop playbooks for how best to win in each of the scenarios and create sense and respond strategies that help identify when and which future scenarios morph into today’s reality.

Middle managers often share how difficult it is to interpret an executives’ words, intent and guidance related to digital transformation.  When an executive says we must “innovate and transform,” it is critical to follow up with a clarifying doctrinal statement shared with everyone.  If the focus is digital transformation, then let's call it a “Digital Transformation Doctrine” that clearly and concisely defines “what, why and how” an organization should understand and respond to it.  The agreed upon doctrine will then influence the development of specific business strategies and tactics. 

Increasingly digital winners win because of information dominance.  When a competitor invests in seemingly unassociated programs and services, ask yourself what data will those programs and services provide today and how can it be an advantage?  Amazon Prime and Walmart+ are good examples.  Investing in understanding your customers better is a good investment.  Look for adjacent market data, or combinations of different data sets that help you see new and different patterns.  Winners thrive in taking action on data patterns only they see.

Speed is an important physics concept and an important business concept as well.  It just keeps popping up in my research.  Is your transformation speed aligned with the speed of changing consumer preferences?  Misalignment equates to lost business for you and more business for competitors.  Capture the speed of change and use it as an advantage.

Simplify to achieve speed and control.  Complexity is the enemy of agility, and acts as poison from the past.  Simplify to achieve speed and let leaders focus on customers, employees, high level doctrines and strategies rather than tactics. 

How fast can you take meaningful action on new data?  What is your speed to action (STA)?  What is your speed to action relative to your competition? How fast are you expanding into adjacent markets and industries, or how fast are they expanding into yours?

How much change can your organization manage in a given time frame?  How do you even measure an organization’s capacity for change?  I propose a need for a unit of measurement called “Transformative Energy Units (TEUs).” All activities either increase or decrease TEUs and knowing how much is available to work with is essential.  Leaders must understand how much change their organization has the energy to make.  They must recognize how to refresh and resupply TEUs in their organization to ensure they don’t exhaust their people and lose their talent.

How digitally friendly is your business model?  I have seen many legacy companies struggle with digital transformation because of friction related to traditional ways of conducting business, compensating sales teams and working with channels.  Of all the things that can negatively impact your business - don’t let it be your model.

Reconnaissance scouts have been used in military organizations for centuries as a way to gain greater insight and make better decisions.  Innovations and proof of concept projects provide businesses with similar benefits.  They allow leaders to make better decisions and investments on insights ahead of competitors.  Advantages in insight lead directly to advantages in business.

Today it is very difficult to build a successful business in isolation.  Investors want start-ups to invest in their unique differentiators, not on aspects of the business that can be shared across ecosystem partners.  Think about the thousands of businesses partnering with Amazon and using their logistics infrastructure and marketing engines.  Smart leaders identify and participate in winning ecosystems that provide shared business value, platforms, systems, functionality and data. As ecosystems expand, they can in themselves become a competitive differentiator. 

Digital winners do not expect or wait for a return to status quo.  Digital winners expect perpetual change and accept they will never return to a past state.  Digital winners learn to manage in ambiguity?  They create an environment that is future focused, where tomorrow’s opportunities are being anticipated and prepared for today.

Digital winners automate and execute change faster than their competition.  Winners have both the agility and the ability to quickly change course and align with fast evolving customer behaviors and preferences faster than their competition.  Avoid partners, suppliers, channels and ecosystems that may limit your ability to be agile.  The future is different, so never lock yourself into today.

Digital winners really understand what their customers want.  Based on this insight they employ the right philosophies, designs, systems, technologies and business processes to provide it.  They look for and find competitive advantages in their user experiences, personalization and recommendation engines, business operational tempos, process automations, omnichannel interactions and experiences, analytics and information logistics.

Rapidly evolving and expanding privacy laws reinforce the importance of keeping existing customers enthusiastic and loyal.  Customers are willing to share a great deal of personal information about their preferences and buying habits in exchange for fair value.  Digital winners honor loyal customers by continually increasing the value they provide.

Digital winners consider the lifetime value of their customers.  They create individual profit and loss statements (P&Ls) for each customer.  This provides them a long-term view and understanding of past, present and future value.  A loyal customer is more than a one-time transaction of a $5 product.  With today’s predictive analytics, a $5 purchase today can be considered one installment of a $200,000 lifetime transaction value.  Given this recognition, what incentives can you customize and personalize today to help capture the full lifetime value?

************************************************************************
Kevin Benedict
Partner | Futurist | Leadership Strategies at TCS
View my profile on LinkedIn
Follow me on Twitter @krbenedict
Join the Linkedin Group Digital Intelligence

***Full Disclosure: These are my personal opinions. No company is silly enough to claim them. I work with and have worked with many of the companies mentioned in my articles.

Retail and a History of Paying for Ignorance

During the Cold War the armies of East and West faced off along thousands of miles of borders with tens of thousands of tanks, artillery units, defensive positions, guns and soldiers.  The costs for supporting these defensive postures were enormous.  Nations invested hundreds of billions of dollars over the years maintaining these positions, not to counter a known threat, but to prevent an unknown threat.  They were investing in ignorance - a lack of knowledge.  They spent massive amounts defending against the unknown - everywhere.  That expenditure was an ignorance penalty.  A penalty, so huge, it negatively impacted the economic futures of many countries.  

Businesses that operate in the dark, and have not digitally transformed fast enough, are also paying an ignorance penalty today.  The ignorance penalty is the cumulative effect of conducting business without digitally derived data providing precise insights and knowledge, and without the ability to act instantly from afar.  In markets where all competitors are equally paying the ignorance penalty, competition is not impacted.  However, when a few companies decide to digitally transform to reduce their ignorance penalty, then competitive markets are very much disrupted.

When some competitors are stuck paying a very expensive ignorance penalty, and others aren’t, a competitive gap quickly opens.  We see this in the form of Amazon and other digitally transformed retailers precisely marketing personalized products to individuals, while traditional stores spend massive amounts marketing generic products to regions filled with unknown customers.

The ignorance penalty rate is high enough that it will bankrupt many companies required to pay it.  In my research, I see data that suggests laggard companies (those slow to digitally transform) believe they can afford to pay the ignorance penalty for a few years while slowly preparing to digitally transform in the future without suffering unduly.  This, however, is what we call digital delusion. 
  • When the retailer, Sports Authority, filed for bankruptcy analysts stated it was due in large part to their slow response to digital commerce competition.  The ignorance penalty bankrupted them.  
  • When the retailer, Aeropostale, filed for bankruptcy analyst reported they were not able to keep up with the speed of their more digitally enabled competitors. The ignorance penalty bankrupted them.
  • When the retailer, British Home Stores (BHS), filed for Administration (UK’s version of bankruptcy), analysts reported they were "very slow to embrace digital transformation, and their products were no longer relevant.”  The ignorance penalty bankrupted them.
The need to stay competitive by digitally transforming does not wait for budget cycles to finish, 5-year plans to be accomplished or alternative strategic priorities.  Your competitors certainly aren't waiting.  Digitally transformed competitors are rapidly propelled forward by new digital insights and knowledge integrated with agile business systems capable of responding to the new information in real-time.  

Businesses have a choice to pay the ignorance penalty, or use the money today to invest in digital transformation - either way, it will be payed.

************************************************************************
Kevin Benedict
Partner | Futurist | Leadership Strategies at TCS
View my profile on LinkedIn
Follow me on Twitter @krbenedict
Join the Linkedin Group Digital Intelligence

***Full Disclosure: These are my personal opinions. No company is silly enough to claim them. I work with and have worked with many of the companies mentioned in my articles.

Digital Transformation in Marketing with SAP's CMO of Customer Experience Kevin Cochrane

I am excited to share my interview with Kevin Cochrane, SAP’s CMO of Customer Experience.  SAP, as one of the largest global technology companies, has been in the midst of an impressive level of digital transformation in sales, marketing and customer experiences.  They have been deeply involved in supporting GDPR (global data protection regulation), focused on improving personalized customer experiences, and developing new brands and products (C/4Hana) to support digital commerce, sales, marketing and customer services all while helping them develop a more intelligent enterprise.  Enjoy!


************************************************************************
Kevin Benedict
SVP Solutions Strategy, Regalix Inc.
Website Regalix Inc.
View my profile on LinkedIn
Follow me on Twitter @krbenedict
Join the Linkedin Group Digital Intelligence
Join the Google+ Community Mobile Enterprise Strategies

***Full Disclosure: These are my personal opinions. No company is silly enough to claim them. I work with and have worked with many of the companies mentioned in my articles.

Digital Transformation in Retail - 13 Action Steps

  1. Recognize the need for digital transformation extends beyond websites and mobile apps to the entire organization and across all business processes.
  2. Understand the degree of change occurring in retail as a result of customers’ fast-changing behaviors.
  3. Judge accurately where your organization stands on a digital technologies maturity curve.
  4. Show the necessary leadership to change strategies, budget priorities and plans based on new data, trends and insights, and then make the required investments in digital technologies, people and skills to compete successfully.
  5. See that traditional channel-centric strategies are no longer viable; rather, retailers must adopt precise, customer-centric strategies, enabled by digital technologies.
  6. Don’t excuse slow adoption of digital technologies, as the data is clear and compelling and demands immediate action.
  7. Think with a digital mindset, intimately understand the capabilities of digital technologies, understand digital’s role and importance in customer interactions, and develop new digital business models, processes and strategies for supporting today’s and tomorrow’s digital markets and consumers.
  8. Realize that digital transformation and the industry’s adoption of digital technologies are occurring on an accelerated schedule that peaks around 2020. It waits for no retailer’s budget cycles, three-year master plan, leadership change or strategy.
  9. Align the pace of digital transformation initiatives with the speed at which consumers are adopting digital technologies, behaviors, markets and thinking. This might mean over-investment in the near term to catch up or stay ahead of the competition.
  10. Unify disparate digital transformation initiatives behind a single company-wide digital transformation doctrine – a guiding statement that effectively describes the reason for digital transformation, what needs to happen and what winning looks like. This doctrine must be used to direct and shape the entire company’s efforts.
  11. Closely monitor the business impact of rapidly emerging digital technologies to ensure investments are prioritized and acted upon in the right time and place to maximize ROI and competitive advantage, while also balancing the need to innovate and embrace a fail-fast, test and learn mentality.
  12. Understand how digital transformation will alter traditional retail roles, responsibilities and skills for all associates.
  13. Pay close attention to how digital transformation shapes and changes consumers’ interactions and experiences, and train associates to best serve digitally enabled consumers.
 Follow Kevin Benedict on Twitter @krbenedict, or read more of his articles on digital transformation strategies here:
  1. Mistakes in Retail Digital Transformation
  2. Winning Strategies for the Fourth Industrial Revolution
  3. Digital Transformation - Mindset Differences
  4. Analyzing Retail Through Digital Lenses
  5. Digital Thinking and Beyond!
  6. Measuring the Pace of Change in the Fourth Industrial Revolution
  7. How Digital Thinking Separates Retail Leaders from Laggards
  8. To Bot, or Not to Bot
  9. Oils, Bots, AI and Clogged Arteries
  10. Artificial Intelligence Out of Doors in the Kingdom of Robots
  11. How Digital Leaders are Different
  12. The Three Tsunamis of Digital Transformation - Be Prepared!
  13. Bots, AI and the Next 40 Months
  14. You Only Have 40 Months to Digitally Transform
  15. Digital Technologies and the Greater Good
  16. Video Report: 40 Months of Hyper-Digital Transformation
  17. Report: 40 Months of Hyper-Digital Transformation
  18. Virtual Moves to Real in with Sensors and Digital Transformation
  19. Technology Must Disappear in 2017
  20. Merging Humans with AI and Machine Learning Systems
  21. In Defense of the Human Experience in a Digital World
  22. Profits that Kill in the Age of Digital Transformation
  23. Competing in Future Time and Digital Transformation
  24. Digital Hope and Redemption in the Digital Age
  25. Digital Transformation and the Role of Faster
  26. Digital Transformation and the Law of Thermodynamics
  27. Jettison the Heavy Baggage and Digitally Transform
  28. Digital Transformation - The Dark Side
  29. Business is Not as Usual in Digital Transformation
  30. 15 Rules for Winning in Digital Transformation
  31. The End Goal of Digital Transformation
  32. Digital Transformation and the Ignorance Penalty
  33. Surviving the Three Ages of Digital Transformation
  34. The Advantages of an Advantage in Digital Transformation
  35. From Digital to Hyper-Transformation
  36. Believers, Non-Believers and Digital Transformation
  37. Forces Driving the Digital Transformation Era
  38. Digital Transformation Requires Agility and Energy Measurement
  39. A Doctrine for Digital Transformation is Required
  40. Digital Transformation and Its Role in Mobility and Competition
  41. Digital Transformation - A Revolution in Precision Through IoT, Analytics and Mobility
  42. Competing in Digital Transformation and Mobility
  43. Ambiguity and Digital Transformation
  44. Digital Transformation and Mobility - Macro-Forces and Timing
  45. Mobile and IoT Technologies are Inside the Curve of Human Time
************************************************************************
Kevin Benedict
Senior Analyst, Center for the Future of Work, Cognizant
View my profile on LinkedIn
Follow me on Twitter @krbenedict
Subscribe to Kevin's YouTube Channel
Join the Linkedin Group Strategic Enterprise Mobility
Join the Google+ Community Mobile Enterprise Strategies

***Full Disclosure: These are my personal opinions. No company is silly enough to claim them. I am a mobility and digital transformation analyst, consultant and writer. I work with and have worked with many of the companies mentioned in my articles.

The Role of Sensors, Real-Time BI, Big Data and Personalization in Mobile Commerce: The Report and the Video

I just completed a video that accompanies my latest research on mobile consumer behaviors, and the strategies retailers must implement.  If you design, develop or deploy customer facing apps, this content is relevant and important.


************************************************************************
Kevin Benedict
Writer, Speaker, Analyst and World Traveler
View my profile on LinkedIn
Follow me on Twitter @krbenedict
Subscribe to Kevin'sYouTube Channel
Join the Linkedin Group Strategic Enterprise Mobility
Join the Google+ Community Mobile Enterprise Strategies

***Full Disclosure: These are my personal opinions. No company is silly enough to claim them. I am a mobility and digital transformation analyst, consultant and writer. I work with and have worked with many of the companies mentioned in my articles.

Interviews with Kevin Benedict