Discover 7 recipes to boost your digital strategy.
Changing companies to adapt to an increasingly digital world is no longer an option. But where to start? What conclusions can be drawn from what has already been undertaken in terms of digital transformation? What future strategic directions to favor? What technologies should we go to? How to modernize its marketing, accelerate innovation or renovate its management? With whom? According to what schedule? Why?
1 Digital Strategy: The Digital Quotient
The digital transformation of a company goes through an audit phase. The culmination of this key step can result in the determination of a Digital Quotient. The Digital Quotient or Quotient Digital in measures the level of digital maturity of your business in an objective, universal and consistent manner. Its calculation is carried out by means of a 360° assessment. It allows your company to clearly identify its digital strengths and weaknesses both globally and at the level of each of the components of its organization. This method makes it possible to reinforce, refine or modulate the digital aspirations of your company by providing a clear and precise vision of the actions to be carried out to succeed in your digital mutation, strengthen your competitive advantage over time and improve your performance. Every company has an intelligence, but does it predispose it to digitalization?
2) On the menu
Goals: – provide the company with a methodological framework allowing to concretely start a digitalization process. – assess a company against the new imperatives that digital introduces. – identify the strengths and weaknesses of a company in order to maximize its chances of succeeding in its digital transformation. – reveal gaps (in terms of assets, resources, skills, investments, etc.). – challenge people, raise awareness, stimulate decision and encourage action.
Background: When the subject of digital transformation comes to the table, the richness, complexity and scalability of digital make it particularly difficult for the company to simply answer such trivial questions as: Where to start? What to start with ? How to get started? Determining the Digital Quotient is a good way to kick off.
3) Preparation & Cooking Steps : 1. Constitute seven groups of employees responsible for defining the company’s Digital Quotient. They will ideally include the members of the executive committee as well as managers of operational entities, who know the company very well and have a strategic vision. These are very important since they will potentially become your “digital champions” embodying, initiating and carrying the digital transformation of the company. 2.Assign each group a component of the company’s Digital Quotient analysis: 1. Outlook, 2. Strategy, 3. Capabilities, 4. Execution, 5. Organization, 6. Culture, 7. KPIs. 3.Organize work meetings allowing each group to rate the company on the thirty items that include the determination component of the Digital Quotient assigned to it 4. Ask each group to present a restitution of their work to the other groups. 5. Compile the results to determine the company’s Digital Quotient.
Methodology and advice: – Emphasize at the outset that no company obtains a score of 100/100 and that the competitors would probably be around 10/100, can make it possible to exceed the political stakes. – It is imperative that all the members of the company’s management committee are part of the groups. – The shareholder’s involvement in the process can encourage his future adhesion to a new strategic plan upstream. – Appointing within each group a leader, designated because of his legitimacy in a profession (IT, finance, HRD …), can be a plus. – It may be wise to complete this work by carrying out a SWOT Digital. – Matching the whole of OKR and / or a MATT can favor the start of a digital mutation and avoid that the company confines itself to simple analysis. Chef’s tip: – Mastering a very technical vocabulary is a prerequisite. Providing a lexicon to participants beforehand can be a solution. – The choice of consultant (s) who will accompany the groups in their work sessions must be judiciously made in order to avoid culture shocks (digital vs. traditional) which could lead to mutual misunderstandings.
4) Tasting – The company is fully screened by a digital analysis grid – A clear, objective and exhaustive vision of the company, in the face of a digitalizing world, is emerging – The granularity of the restitution then helps to the construction of operational strategies.- The exchanges between the participants, around certain ratings to be assigned, are often very rich.- The opportunity is given to those turned to innovation to assert their leadership.
2 Digital strategy: The matrix of digital transformation
The digital transformation is not limited to the simple evolution of the company’s professions. It also requires organizations to thoroughly review their way of operating, their culture, their mode of governance, their management, their processes … The digital transformation matrix provides companies with a framework composed of six structuring projects, accompanied by a macro-process intended to promote their implementation in an iterative manner, while familiarizing themselves with the main components of digital culture.
2) On the menu Goals: – identify the major sites of digital transformation. – provide a roadmap to company management. – raise awareness of the need to go beyond the organization in silos. – highlight the necessary and difficult evolution of the corporate culture Background: Almost all companies have taken digital initiatives, on a more or less large scale and with more or less success. Experience has shown day after day that digital is impacting organizations even more than anyone imagined. The digital transformation matrix is a way to coordinate digital initiatives scattered within the same company or to provide a clear and common framework when formulating a new digital strategy intended to overlap with no longer just evolve on the fringes of it.
3) Preparation & Cooking Steps:
1) Define the six areas of digital transformation (Management, Human Resources, Technology, Data, Marketing and customer experience, Measurement). 2) Cut each of these sites into cycles of five phases intended to be renewed incessantly: 3 phases of change management: Audit, Plan, Test and 2 phases of implementation of the change: Deploy, Optimize. 3) Instill in the company, throughout the process, the main rules of digital culture. Methodology and advice: – Take into account upstream the disparities of decision-makers (training, objectives, vocabulary, measurement indicators …). Creating a Stakeholder Map can be a solution. – Take into account the differences in digital maturity of the professions, services and people. The results provided by the Digital Quotient (cf. Recipe 2) could be invaluable. – Give meaning to the process in order to avoid suggesting that we are digitizing simply to digitize. – Do not underestimate the considerable effort (personal questioning, development of new skills, adoption of new skills, acceptance of English …) required of each.
4) Tasting – The matrix expresses, in a conventional manner, an approach which is however a radical departure from what is practiced in the company and which therefore reassures. – It provides a battle plan that can give the company the opportunity to achieve new visible things that motivate teams. – The approach is transversal. – The use of the matrix leads employees to evolve by adopting a new culture more in line with the new ecosystem of their company.
3 Digital strategy: MATT
The field of possibilities opened up by the digital revolution offers the company a multitude of options. Coupled with the need to move fast, to constantly capitalize on new technologies and to innovate at all costs, the risk that naturally arises from this is dispersion or even loss of control. MATT (Milestones, Assumptions, Tests and Tasks) is a recipe for keeping different digital initiatives under control, whether they are macro-projects or simple projects, while accompanying their adaptation to reality over time.
2) On the menu Goals: – learn with experience – keep a digital initiative under control. – ensure consistency between the tasks carried out and the targeted results. – anticipate and allow the rapid identification of the differences observed with a view to readjusting the overall approach. – provide the company and management with a common framework for communicating on the progress of an initiative (site, project, etc.).
Background: Coming from the world of start-ups, MATT is particularly suitable for new initiatives for the company. It also promotes the conduct of several simultaneous initiatives. It also constitutes a monitoring grid for digital advances within an organization that has opted for Test And Learn * or Fail Fast **. * Approach based on the principle that things do not succeed the first time and that you have to go through failures before you succeed. The Test And Learn method therefore encourages taking initiatives, measuring and collecting very frequent feedbacks in order to draw lessons intended for implementing corrective actions. ** The logic of Fail Fast comes from the world of start-ups and encourages error, provided that we become aware of it as soon as possible so that it costs as little as possible and can make it possible to correct the situation.
3) Preparation & Cooking Steps:
1) Specify your milestones such as the existence of a prototype, the consumption of the capital initially invested, the results of various tests, the number of customers who actually bought the product, the cash flow and the threshold profitability. 2) Validate your initial hypotheses. They may be based on the size of the market, the rate and speed of adoption of the product by customers, the gross margin, the number of calls, e-mails, customer meetings necessary for the realization of a sale, the cost of customer acquisition, the conversion rate of prospects into customers, the duration of the sales cycle, the return on investment per customer, the cost of technical support per unit sold, the payment periods. 3) Test your hypotheses by answering the questions: is the PMF real? Is the MVP really there? How is the product understood by customers? Is there a possible virality effect? Does the cost of customer acquisition allow profitability? Will customers use the product well? Do we have the resources to maintain the product? Does the product stand the test of reality? Is the business created scalable ***.
4) Adjust the action plan according to the above. Four levers will be observed: the recruitment of new employees, the search for distribution channels, the implementation of what will allow payment, billing and collection, and finally the performance of essential administrative tasks. *** Scalability is a concept relating to the business model and refers to the potential for large-scale variation of an activity. Methodology and advice: – Build your MATTs following a bottom-up logic. – Do not mix several initiatives within the same MATT. – In the start-up phase, equip yourself with a MATT meta intended to pilot the process of deploying the recipe in the organization. Chef’s tip: – A MATT should not be written once and no longer be viewed. It should be regularly consulted and updated. – Avoid that finance takes too much control over the process, at the risk of killing digital initiatives that meet other criteria than those of the core business of the company.
4) Tasting – Used correctly, the recipe guarantees the company that the digital initiative is indeed under control. – The alerts that the method makes it possible to promote continuous adjustment without interrupting the progress of the project.
4 Digital strategy: Exponential technologies
Exponential technologies are, among the information technologies, those which make possible the conversion to digital format of what was by physical nature, in a world where things are now consumed more and more on demand (music, films , applications, travel, accommodation …). The companies that have failed to capitalize on the emergence of this new type of technology are well known: Iridium, Kodak, Polaroid, Philco, Blockbuster, Nokia … and so many more to come. Knowing how to distinguish an exponential technology from a new but more traditional technology is no longer an option, but a strategic imperative.
2) On the menu Goals : – become aware of the potential of new technologies which, if well used by agile companies, could literally disrupt an entire industry. Background: – For companies that sell something physical and potentially transformable into a new digital service, the observation, understanding and adoption of exponential technologies – no longer considered as threats but as new opportunities – are a key element.
3) Preparation & Cooking Steps:
1) Get an overview of the technologies likely to impact your business portfolio. 2) Identify new entrants, candidates for uberization in your sector, the progress and improvements of each technology itself. 3) Specify why, how and under what conditions the product or service that you sell may no longer exist in its current form or could become a mobile application, a website, a new connected object, etc. Methodology and advice: – Reduce the anxiety-provoking nature of the approach by introducing gamification. – Present the threats (start-ups in particular) with the maximum of factual and quantified information (turnover, hope of profitability, limited capital for important investments …) in order to reduce the fear that inspire start-ups to established actors, and which they know how to play perfectly. – Involve the youngest members of your company, who are far more familiar with digital uses and who are better able to bring a fresh perspective – Use the applications, sites or technologies identified in the first phase intensively.
Chef’s tip: – Be careful not to create a generational shock internally, which would oppose the old and the new or worse, the young and the not so young. – Take into account that the longer we have been working in a sector, the more painful it is to admit that things will no longer be as before. The members of a management committee can realize with such an approach that they have more to lose than young people, newly arrived, have to gain. 4) Tasting – Anticipate threats of uberization or disruption. – Indirectly put the company on the path to its self-disruption (fashionable strategy proclaimed as a remedy for disruption by others).
5 Digital strategy: Law 70/20/10
“Coca-Cola, right. But above all, it’s a company that, like other large groups ranging from L’Oréal to Google, has successfully applied the so-called 70/20/10 law. The digitization of a company is particularly consuming capital, resources, investments, involvement of top management, time of employees to upgrade their skills, etc. The arbitration to be carried out to meet the growing demands of digital (innovation, speed, agility, change, internationalization, etc.) while preserving the main activity of the company (at the origin of its turnover, profitability and sustainability) is particularly difficult. Law 70/20/10 provides a simple and operational response to this problem.
2) On the menu Goals : – ensure the evolution of the company, its offer, its operating methods to allow it to remain competitive. – allow innovation while preserving core business. Background: – The evolution of the company’s ecosystem, due to the development of digital, has never made innovation so necessary or, at least, the significant evolution of everything that allows it to be competitive today ‘hui. Law 70/20/10 provides the orders of magnitude allowing the arbitration between taking necessary risks and preserving the activity of the company.
3) Preparation & Cooking
Steps: 1) Exhaustively list all the initiatives, developments and projects of your company. 2) Divide them according to three criteria: Now, which will include everything that helps keep the business alive today and will consume 70% of the resources. Next, which will bring together developments, innovations and projects intended to remain competitive or take a step ahead in the next two years, and will represent 20% of resources. New, which will encompass everything that exceeds a three-year horizon and aims to be particularly innovative, occupying 10% of the remaining resources. 3) Make the organizational adjustments necessary for this strategy. Methodology and advice: – Establish this rule during the annual budget construction or at key moments in the definition of the strategy. If the company uses Open Innovation, have a clear rule relating to whether or not external resources are taken into account in this breakdown. – Avoid the temptation to use the time share of the same collaborator between Now and New for example. The demands and emergencies of core business would end up devouring the time devoted to innovation.
Chef’s tip: – If the rule relates to allocated resources, it should not be systematically applied to investments. A frequent temptation. – Avoid setting it up slowly, by establishing a transitional rule of the type 85/10/5 the first year. The difficulties inevitably encountered in the first year could encourage the fact of going no further and making this transitional division a lasting rule. 4) Tasting The rule provides a clear answer to a difficult problem. It is reassuring, due to its now massive adoption by a large number of large groups and therefore hardly questionable or negotiable. It leaves room for innovation.
6 Digital strategy: The MIT Capgémini matrix
Defining the level of digital maturity of a company is a key question. This matrix allows us to answer them. For businesses, it is a self-diagnostic tool on their level of digitalization. In the midst of a digital revolution, the digital development of companies is becoming a major challenge of global transformation (productivity, innovation, management, organization …). If the what and why of digital transformation is now widely understood, the how is less. This matrix makes it possible to assess companies in terms of digital development and to orient their developments in this direction.
2) On the menu Goals: The work carried out by the Massachusetts Institute of Technology (MIT) on the subject of digital strategies, in collaboration with the consultancy firm Capgemini, has opened up a field of investigation on the subject of digital intensity. The level of digital intensity is then assessed along two axes.
1) The first axis is that of the digitalization of business processes. It consists of listing the organization’s processes, ensuring their digital eligibility and measuring their level of progress. It produces a representative percentage of the digital efforts made within an organization. 2) The second axis is that of the intensity of digital sponsorship by management, the appropriation of digital challenges by management teams, the change in posture generated. Background: – The crossing of the two axes produces a matrix which offers a typology of organizations. We can thus speak of endogenous digital maturity because the two axes relate to internal elements. These two axes also provide avenues for companies to define actions with a view to implementing a digital transformation. A digital strategy thought out from this matrix will be broken down into two axes. – The first will aim to define critical processes in terms of digital and the technological alternatives making them possible. The processes can thus be managed separately in project mode or by cluster according to technological and organizational constraints. – The second axis will aim to train the managerial line in its dual role of relay and co-builder of the digital processes accompanying organizational changes, governance and posture.
3) Preparation & Cooking Steps :
1) Exhaustively list all of the organization’s processes 2) Determine for each his digital eligibility (if it can be partially or completely digitalized). 3) Define the percentage of processes currently digitized in relation to eligible processes. 4) Evaluate the level of digital skills of managers. 5) Position your company in one of the possible configurations proposed by the matrix. Methodology and advice: – The matrix distinguishes beginners with few processes in the process of digitalization and almost zero support by management. The digital strategy is therefore limited to a few isolated experiences that are difficult to generalize. – Curators form a category in which the managerial line is very motivated and competent for change, but does not use digital to achieve this. – The technological imitators represent those who think that change is only done methodically. They adopt all the fashionable technologies without ensuring their usefulness and the support of managers. – Digitizers are the most competent to operate the digital transition. They want and know how to use technologies while mobilizing management. They have a network of internal leaders with whom they set up experimental devices to move the lines and change uses by creating new ones.
Chef’s tip: – Keep an eye on other aspects of digital transformation that cannot be summarized only in process evolutions and management styles. – Ask yourself constantly about the validity and relevance of the means used to assess the degree of appetite, competence and digital maturity of managers.
The MIT Capgemini study shows that companies called digital masters because they have the highest level of digital maturity are 26% more profitable and have a valuation on the financial markets 12% higher than their counterparts. The approach shows that some sectors are more advanced than others. The percentage of digital masters within a sector makes it possible to measure it. IT and the bank have 38% and 35% respectively of digital masters compared to 12% in industry and 7% in pharmacy. One of the reasons put forward to explain these differences is the involvement of managers in the digital transformation of their business.
7 Digital Strategy: The Hype Cycle
The Hype cycle, sometimes called the Hype curve, is a figure that positions technologies according to five key phases that illustrate the stages of their maturity. This curve provides a macro reading of the emerging technologies available to companies at any given time. For purely digital companies and especially start-ups, this cycle makes it possible to identify where the technology developed by the company is located
2) On the menu Goals : Digital transformation has long been tackled with a stack of technologies. The more a company had implemented so-called digital technologies, the more its level of “digitization” was considered to be high. Gartner Group was one of the first to offer an analysis in terms of digital maturity by focusing on the maturity of technologies, avoiding businesses to rely on hype technologies by favoring more sustainable technologies.
Background: By proposing the cycle of Hype innovations, the Gartner Group analyzes the technologies each year and positions them on the following curve, thus allowing companies to consider the technologies proposed according to their degree of maturity and to ensure their relevance with regard to their internal needs. 3) Preparation & Cooking
The Hype cycle offers five phases for adopting a technology, which are as follows: 1) The launch of the promising technology which generally arrives on the market with unstabilized prototypes 2) The peaks of exaggerated expectations: communication on the first failures and successes, the media excitement of many start-ups that are emerging around technology. 3) The abyss of disillusionment: the products do not ultimately meet the exaggerated expectations and the difficulties in finding a business model of the reference players generate negative media coverage. 4) The slope of enlightenment: companies persist and offer a second generation of better quality products. Consequently, a market is formed and develops.
The productivity plateau: the technology is stabilized and allows the development of new products which fit into a more or less extensive market.
Methodology and advice: – This curve makes it possible to classify the technologies on the market according to their maturity in order to differentiate those which are in phase of explosion (the first three stages) and those which are in phase of operationalization on the market (the last two stages ). – The third step, Trough of Disillusionment, is key since it coincides with the transition from innovation to invention. The product becomes a real solution and thus fits into the uses of the users.
Chef’s tip: – Keep in mind that the hype cycle is more about the communication generated about a new technology than the technology itself.
This deliberately very macro curve allows us to take a step back with regard to certain technologies which are sometimes presented in an overly optimistic manner. It shows that there is a key notion of maturity in new technologies and that it is important for a company to know when to bet on a technology based on this maturity.