Digital Innovation is a Necessity That Business Leaders Cannot Ignore

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David Green Principal Consultant
 

 

The increasing rate of digital innovation is transforming the world around us and enterprises must adopt Agile methodologies to achieve successful Digital Transformations

 

In our recent series on Digital Transformation, we explored the impact of 3rd and 4th Platform technologies on human behaviour and their effect on how businesses interact with customers, employees and other stakeholders. As we discussed, the exponential growth and adoption of new technologies throughout society and business is radically reshaping the modern world. Business leaders cannot ignore the transformative force of technology or the ways in which this has changed the behaviour of major stakeholders. To do so is to offer all your competitors the opportunity to develop an unchallenged strategic advantage.

Kuoni was founded in 1906 to focus on providing affordable and accessible travel opportunities. Despite its early adoption of computerised reservation systems in the 1980s, the company failed at digital transformation in the new millennium. In the end, Kuoni failed to recognise the dramatic and permanent changes developing in the travel market and realised far too late that travel was going digital – driven by the changing behaviour of customers. At the point when the company did come to understand the digital shift, resistance to change that came from within the organisation ensured that when Kuoni went digital, it was too little too late. Ultimately, the company sold its tour operating activities in 2015 after a long period of decline.

To modernise your organisation and move its functions, operations, processes, systems etc. on to 3rd Platform technologies, you cannot simply look at things in isolation and seek to digitalise them. Customer-centric digital innovation is the key to success. By reviewing your entire enterprise and examining all the ways in which you interact with customers, employees and other stakeholders, you will be able to design new, fully integrated digital solutions to meet rapidly evolving demands and expectations.

Take Pitney Bowes for example. Traditionally the organisation was synonymous with mailing and postage meters, which was put under enormous pressure after the wide spread adoption of email and paperless offices. Many businesses in the same position might have crumbled, and many of their competitors probably did. However, Pitney Bowes reviewed their entire enterprise to identify and develop new strategies and digital innovations for the modern world. What they created was their own Commerce Cloud platform that leveraged their vast experience in shipping to help other companies more efficiently ship, communicate and pay. They even created a completely new business unit to help online giants like eBay determine where an international package can be shipped and how much duty will be charged.

Other companies like Zillow and Twitter use Pitney Bowes to show the locations of their 1 billion+ social media users. Part of Pitney Bowes’ success can be attributed to the fact they changed their identity from a mailing company to a ‘global technology company’. Net income rose from $143 million in 2013 to more than $400 million in 2015.

One important thing to bear in mind is just because the Digital Transformation roadmap you embark on today promises added-value tomorrow, do not expect it to in the future. The increasingly rapid pace of change forces business leaders to develop and implement Agile methodologies that shift and pivot the enterprise, steering it towards the technological reality of tomorrow and avoiding the pitfalls of today.

Is your business ready for Digital Transformation?

To learn more about Digital Transformation download our free guide: Transformation: A Guide for Business Leaders