Being a digital business is much more than having a web presence and e-commerce capabilities.
It is also much more than having a mostly paperless office, digitising hard copy and generating new “paperwork” electronically.
A book by Adrian J. Slywotzky, Karl Weber and David J. Morrison, called “How Digital is Your Business?” states, “A digital business uses digital technologies to devise entirely new value propositions for customers and for the company’s own talent; to invent new methods of creating and capturing profits; and, ultimately, to pursue the true goal of strategic differentiation: uniqueness.”
A digital business uses technology as part of its core business processes, not just as a support for those business processes.
An InformationWeek article asks the question, “Is Your Company Really a Digital Business?” which suggests, “Being a digital business requires an outside-in view, where you ask: What do my customers need, and how can I use new technologies to do something for them that will eventually become revenue for me?”
The article goes on: “Companies that only “look and feel digital” view customers from the inside out and end up applying new technologies that make life easier for employees but don’t do much to make customers happier.”
So a true measure is based on customer interaction and customer satisfaction.
EMC Corporation gives some examples of a digital business:
“In retail, companies such as Zara and H&M are processing customer data with powerful new analytic technologies that provide insights to keep fashion fresh and give competitors fits. In the insurance and automotive industries, new telemetry technology provides information that enables managers to assess driver behavior more specifically than ever before, and apply this information to policy pricing and auto design. Audio speakers from Sonos and tennis racquets from Babolat now leverage software to enhance experiences and provide new services for customers.”
All of the above are innovations to enhance the customer experience that also give the company more data about their customers enabling them to keep tailoring their services and products to real customer requirements.
EMC conducted a survey which identified three traits needed to compete in the digital era: “demonstrating transparency and trust, delivering unique and personalized experiences and operating in real time.”
Cloud computing, mobile devices, social media and big data technology all enable and contribute to a digital business but do not make a business digital. To be digital these technologies must be a component of an overall digital business strategy to satisfy customer expectations and demands.
KPMG have a guide to measuring digital business aptitude which includes a diagnostic tool.
Unless you have new ways of thinking, new roles and skills, new structures and operating models and the ability to adapt quickly to change, your business does not have what KPMG refers to as DBA – digital business aptitude. What do you think you need to do to get DBA in your business?