Anatomy of digital transformation

Customers have multiple options to choose from and what sets you apart is the experience you provide them during each interaction they have with your brand. According to a recent survey, 63% of companies have seen an improvement in customer satisfaction following a digital transformation in their business. So the question of the hour is: What is your Digital transformation strategy to ensure that you stay ahead of your competition and provide your customers with great experiences during every interaction?

Let’s trace back to understand how digital is taking over to modern customer’s decision making process.

With ubiquitous availability of Internet and proliferation of smart electronic devices, the consumer world is using technology like never before. As it becomes all pervasive in day to day life, enterprises are facing tremendous pressure to make ‘digital’ an integral part of their growth strategy.

Companies no longer have a choice about whether or not to go digital. They might as well ask themselves whether or not they want their business to survive. While older players are trying to see how they can update their legacy systems and re-jig their processes in order to support their digital strategy, they have to compete with newer players who are born in the digital era and are disrupting the marketplace.

Let’s take the case of Uber, for example, successfully disrupted the intra-city transport markets globally by coming out with a model that works solely on the popularity of smartphones. Uber enables cab bookings through a text message or using the Uber mobile App. The App also allows users to track the location of their reserved cab. Despite some minor regulatory hiccups and widespread protests from traditional cab companies, Uber today operates from 37 countries and is growing steadily. The traditional cab industry is still trying to catch-up.

Airbnb is another excellent example. The online rental and lodging facilitator has 500,000 listings in 33,000 cities and 192 countries, giving traditional hotels a run for their money.

On the other hand, Nestle is a good example of a traditional company using digital to its advantage. Below is a video of Pete Blackshaw, Nestlé’s Global Head of Digital & Social Media speaking at the Adobe Summit 2014.

The growing pressure on enterprises to go digital is coming from customers and employees alike. Customers are increasingly demanding uniform engagement across various channels, offline and online. Likewise, employees expect to be able to work seamlessly anytime, anywhere and on any device.

Competitiveness of business is, of course, the major factor. According to a 2014 survey on digital transformation, 53% of companies are facing challenges in understanding digital customer behavior. This relates closely to increases in the pace of changing businesses. Overcoming this and gaining a deeper understanding of the customer enables organizations to gain significant footfall in the process of making the digital transformation.

Companies that are utilizing digital technologies most effectively are seeing phenomenal benefits. There is often a marked transformation not only of their own operating processes but also in the way they engage with customers and employees, which in turn results in better growth and profits. Social media, mobility, analytics and cloud (SMAC) enable enterprises to have unprecedented insights into customer behavior, industry trends and inventory management to name a few. This coupled with great design and engaging user experience brings a sense of brand loyalty and customer retention.

The five point business process for digital transformation:

• Successful digital transformation does not simply mean implementing new technologies. Rather, it means transforming your organization to take advantage of the possibilities that these technologies bring. It means reshaping the organization to take advantage of valuable existing strategic assets in new ways
• Companies can do much more to gain value from investments they have already made, even as they envision radically new ways of working. Companies need to make the shift from a system of records to systems of engagement allowing them to have a single unified conversation with their customer. Systems of engagement allow companies to stay beside their customer through every step decision making and purchase journey, by providing customized and personalized experiences to their customers.
• Major digital transformation initiatives are centered on re-envisioning customer experience, operational processes and business models. Companies are changing how functions work, redefining how functions interact, and even evolving the boundaries of the firm.
• Before you embark on a digital transformation journey, first think hard about your vision as a company and understand which digital initiatives will help take you closer to the goal. Then invest in those digital initiatives and skills within the organization. This could mean anything ranging from better customer engagement or employee initiatives to rejigging operational processes. Ensure a reasonable timeframe to begin seeing results of your efforts. There is usually a lead time between implementing technology and seeing the rewards.
• The key to successful digital transformation is to view it in a holistic manner as a company transformation rather than merely as technology upgradation. To achieve the best results, the CIO needs to view himself not just as a technology driver, but as a change driver for the entire business.

The time is now. Change is inevitable and taking the first step to digital transformation is the neo-modern approach of engaging with your customers better. Know them, understand what they are looking for, engage with them better. Make your customers your champions.

Systems of Engagement: Moving from an age of transactions to engagement

Building long term sustainable businesses that show growth and profitability are the primary goals of every business. Customer experience plays a huge role in achieving all three. In today’s multi-channel environment, customers expect a consistent and positive brand experience across all mediums if they are to remain loyal. Engaging your customer at every step of their journey with you remains critical to ensure that you are able to sell, cross sell, establish loyalty and sustain profitability. To create a seamless experience across all channels – social, email, voice, SMS, web, and the latest mobile application should be utilized optimally for right-time customer engagement strategies. The goal is to send the right message to the right customer at the right time through the right channel to increase response rate. So welcome to 2014 – it’s all about Systems of Record meeting Systems of Engagement to Greet the New Customer.

Over the last three decades, IT transformed the business landscape by capturing, structuring, and automating a growing percentage of the information that businesses require to operate. While this has offered many benefits to companies that have heavily invested in IT, it has had its limitations. It created systems of record, which were transactional, data centric command and control systems. Systems of records are passive, largely focused on providing information to a company’s workers.

Thanks to the rapid social movement, even as I write this I am excited about witnessing a decreasing emphasis on systems of record to a paradigm where everything happens in a collaborative, communal environment in which insights, ideas and nuances are key.  SoE is about a huge transformational change that is occurring in IT groups in almost every major corporation around the world. SoE systems are more decentralized, they incorporate technologies which encourage peer interactions, and often leverage a variety of technologies to provide the capabilities to trigger those interactions.

Analytics tools are enabling businesses to deconstruct information and create actionable insights that drive informed business decisions. Technology allows data to be collated from multiple sources and amassed in one location. This then provides access to analyze predictive patterns in the data that provides further insights. Businesses seeking to engage with their customers should have a targeted measure to reach out to the relevant audience. While engaging in the sale is one part of the customer experience process, the crux lies in the ability to leverage the same technology to secure continuous feedback and reach out to the consumers in a timely manner. By leveraging modern digital technologies, you can impact customer experience through:

• Consistency of messaging across multiple channels, including web, mobile, social, email, print and IVR/call-center, by leveraging the same content in many places.
• Personalization of messaging through the use of analytics, CRM, and other tools that integrate with or are a part of digital marketing solutions.

These shifts are profoundly affecting customer behavior. And they are changing how we must behave as companies to engage more meaningfully than ever before with an ecosystem of customers, partners and employees.

A great example of companies leveraging systems of engagement to make it big is Domino’s. The company saw a whopping 29.2% growth in Pizza delivery business in the first half of the year soon after its transition to a “truly online retailer”. Of these, 27.5% of online orders were taken via a mobile device. That’s up from 17.9% in 2012.

Understanding and treating a customer as an individual rather than a segment has helped Dominos realize the value in its ecommerce and m-commerce initiatives.

With their “truly online retailer” model, they have been successful in enabling a seamless purchase journey be it in store or online.  Never have the online channel growth been so voluminous, so overwhelming, so intense, and as persistent as they are now. Domino’s is getting closer to becoming a “customer company” by engaging with the customers, building relationships and giving them what they want, where they want it.

Here is another example of what Tesco did in South Korea in order to become number one in that market by make a strategic move towards systems of engagement.

They zeroed in on an insight: commuters waiting for their train to go home after work had time on their hands. After a long day at work an opportunity to shop while doing something else had a lot of value. Tesco plastered the glass walls of subway stations with pictures of their products, laid out just as they’d be in a traditional shop. The ‘shelves’ featured unique QR codes that could be scanned with the customer’s mobile phone, helping him build up a shopping basket in the few minutes before the train arrived. If the train arrived before the basket was complete, the customer could carry on shopping without the pictures and codes. Deliveries would arrive in minutes or hours, rather than days, so the groceries were in the shopper’s kitchen that night. The application was developed with an advertising and online development group.

 

From multi-tab browsers to mobile devices, customers hold the power of information in their hands. Hence, the companies that succeed are the ones prepared to dynamically establish customer dialogue and match the conversational context in real-time.

I’ll be exploring systems of engagement in more detail in the coming blogs. Stay tuned.

HOW TO: Manage people at different stages of their careers

From my experience in managing people over the years, I have found that it requires different styles and varying triggers to manage and motivate people from different age groups or stages in their careers. I like to divide people into the groups based on stages in their careers and age groups – where age is just an indicative number but the stages are more important, similar to how the 2*2 customer matrix I had built to help choose your customers. This is important in two respects – first, from the angle of managing people and understanding their drivers and second, for people to understand themselves better in these various stages.

Based on my experience, the following is the criteria I have kept in mind to create groups and how I deal with them:

• How to manage people with different age groups
• People have different motivations, pressures, and aspirations depending on their own stage in life

The best way to manage them is to deeply understand what drives their motivations and behaviors and create opportunities and challenges according to what works best for them. I’d like to reiterate that the age groups are just indicative, but it is more important to look at it from the perspective of the stage of their career.

Group 1: 20-28 years

For those just starting out in their careers when they come out of college, this group has a higher financial freedom and is relatively easier to manage. Their motivation comes from interesting and challenging work and learning and experimenting. Therefore, loyalty might not be one of their strong points as they are at a stage in which they have high risk taking abilities. It is key to keep them engaged and challenged. It is likely that this group speaks out for more challenging work. Also at this stage, switching paths will have a cost in rebuilding networks/connections which will not help in their own professional growth.

Group 2: 28-34

At around 28, the pace tends to pick up. They are faced with high levels of peer pressure and this is when they need to learn how to handle and manage this pressure. They need to make the “right” choices in terms of what job they want to do and where they want to do it. This phase is crucial to the next step in their careers, so they tend to focus on learning and preparing themselves for that next step. On the personal front, they might look towards settling down and investing in a house so they begin to lose the financial freedom they had in their earlier years.

It is important to focus on preparing these individuals for the long term by providing and encouraging training as well as focus on managing their financial situation by investing in long term investments – both personally as well as professionally.

Group 3: 34 – 42

Once the pace has picked up, it doesn’t take long to move into a gallop. They are compelled to compete and are thrown head first into extreme peer pressure. There is even less financial freedom at this point in their careers and might be faced with the fear of losing their job coupled with high levels of debt. Simultaneously, they might have started a family and will have less time to focus on their careers as they have added responsibilities at home. It is much harder to take risks at this stage and if they are not managed well, it could become a disaster period for their careers. On the other hand, if they are managed well, it could be the most successful period of their careers.

It is at this point when you can tell the differences between individuals who might have started out together after college. Some mature into true leaders while other might see that their pace of growth begins to decline.

In managing this group, it is important to learn how to handle the pressures they are faced with. Encourage them to balance their family and work and keep a good pace for a steady growth.

Group 4: 42 – 48

After the crucial galloping stage, individuals tend to cool down. They are easier to work with and focus on enjoying work rather than focusing on titles, growth and the rat race in general. They thrive on recognition and rebalance their priorities. By now, they have lower financial and family pressure causing their confidence to increase.

Group 5: 49+

From a slower pace in the previous stage, individuals tend to move into cruise control mode. They are at the peak of their maturity and capabilities. They are much less compelled to compete and prefer to focus their energies on the greatest possible contributions to society and people.

Do you agree with the general categorizations? Is there another way you look towards either motivating your team in the different stages of their careers?

8 questions you MUST contemplate and answer before going Agile

While the spotlight shines bright on Agile methodology and its advantages, there are a number of questions that need to be answered before taking the leap.  Here are my key concerns before I take the leap.

Why Agile?

A lot of the time, people think that Agile methodologies and development will solve all their problems with a minimal amount of effort. This is not true at all. Before you jump into implementing Agile it is important to understand what agile can solve for you and the effort required in doing the same. Agile is not a magic solution to all problems. Agile actually makes problems transparent and very quickly too.

Can you create the change in mindset of your organization?

Agile has been called many things – a methodology, a process. But I strongly believe it’s more of an attitude, a culture, an understanding, and a philosophy.  Bottom line, Agile is a mindset change. It is not about the processes. People tend to struggle with that by immersing themselves into processes but lose sight of the bigger picture.

Being a scrum master doesn’t make the project successful. The cultural shift is what makes agile successful.  Raising the bar for developers where their responsibility doesn’t begin and end with code but truly understanding and embracing the purpose of the project.

Is your organization ready for the transparency that Agile brings?

While some believe that Agile project management fixes your problems, I find that instead, its reveals your problems with such clarity that you have no choice but to fix.

The high visibility on Agile teams causes poor performers to stand out like a sore thumb. In another instance, if you have a track record of generating defects, the agile methodology will put these under a magnifying glass forcing you to implement tighter quality practices. If you have a negative team culture, getting people to work together across the same silos will cause more setbacks until the team dynamics have been sorted out.

Before you go Agile, be sure you are prepared to handle the truth when it is revealed.

Are you approaching Agile in the right way?

It is easy to believe that you are doing Agile right, but it could be completely wrong.

Depth and direction are key in strategizing Agile technologies. The right techniques must be chosen for the current project and every project might have a different and “best” technique. If this is not done, a team might move from waterfall to agile but instead of using the principles of agile properly, move into a “code and fix” method.

How much planning does Agile project management require?

Some people believe that Agile does not require planning. However, the Agile approach requires the right balance of the right amount of process to manage these projects. Agile project management requires a significant amount of coordination to be successful. Every standard agile framework has atleast 4 stages or levels of planning – daily, iteration, release and project. It has a full suite of artifacts called backlogs that are product, iteration, impediment and risk.

The Agile approach is not necessarily the best option for a small and simple low-risk project because a it requires an investment of time and resources to implement the discipline and rigor that the Agile framework needs to be successful.

Does your organization have the discipline to manage the change requests?

Due to the nature of Agile project management, iterations and change requests are the norm. Therefore Agile requires more team and individual discipline, commitment and openness than a dysfunctional organization may be ready for.

What are the implications of requirements management for Agile?

As a part of the Agile approach, the detailed requirements evolve with time. However, sometimes an organization is not ready to work without the detailed requirements. Culturally people may not be comfortable with lack of a detailed requirement document. It is important to make people aware about the same and set expectations accordingly..

How do you prioritize stories?

Agile projects need strategy and prioritization and forefront. Agile teams have a tendency to focus on tactical accomplishments at the expense of strategic goals. This defeats the purpose of putting an Agile framework in place.

In conclusion, Agile requires contemplation before your organization takes a step towards it. Are there any other concerns you have while you ponder the Agile journey?

Agile is not a process, BUT a mindset

Agile has been called many things – a methodology, a process. But I strongly believe it’s more of an attitude, a culture, an understanding, and a philosophy.  Bottom line, agile is a mindset change.

It is not about the processes. People tend to struggle with that by immersing themselves into processes but lose sight of the bigger picture.

Being a scrum master doesn’t make the project successful. The cultural shift is what makes agile successful.  Raising the bar for developers where their responsibility doesn’t begin and end with code but truly understanding and embracing the purpose of the project.

There has been a significant change in processes from the Waterfall model, which is often used in software development processes. The waterfall model is a sequential design process, derived from manufacturing processes in which progress is seen as flowing steadily downwards – from conception to design to testing to production. In the past, the waterfall model has been more popular.  The software industry is no longer a place where things move cleanly from one stage to another.

The waterfall model is an old school model – with some fundamental flaws. Companies have tried to fix this by adding demos and shortening release cycles. While that might fix the symptoms of the waterfall model’s problem, it does not address the root cause which is collaboration between the team and business user. A requirements document moving between an internal team to a business user or between a vendor and a customer causes a vicious cycle that delivers only according the deliverables on the document.

How do we change the mindset?

1.      Promote collaboration:

Collaboration is essential to every single component of agile. The industry is fast paced and requirements change with the markets and competition. It is imperative to communicate with the stakeholders as often as possible. The end business user of any IT product or solution should be involved through every step of the project so they can help refine ideas, discuss potential changes and make sure the users’ best interests are kept at the forefront.

2.      Build iterations:

It is hard to imagine or visualize what software will look like at the end of production. The trouble with a signed off set of deliverables is that we will not question the plan, challenge the assumptions or revisit the logic.

3.      Focus on outcome: 

We have to make sure the process gets as much clarity as possible in getting to the final outcome of the project. Typically, a team works on a requirements document. But the success of the project is dependent on meeting the constantly evolving business outcome as opposed to the initial requirements.

How we can help our customers?

We have worked with numerous customers and this is a typical problem we see with most of them. Their teams are suffering, taking 20-24 weeks to deliver a business outcome. These inefficiencies exist based on how they are structured in a waterfall model and we see many examples of how IT teams struggle to deliver business requirements. The agile philosophy changes the way these projects are structured and takes them to successful outcomes. We are in the business of changing the business, which means we are completely focused on the outcome of the project and clear alignment to business goals.

Choosing customers – Cupcakes, Snape and a 2*2 framework

In my career, I’ve closely worked with and managed all kinds of clients. Some gaveus that vital push, helping us become who we are.  Some challenged our belief systems and shaped our worldview.

Many became lifelong friends and many more became LinkedIn contacts. Choosing right customers and having a framework to distill this art can be of great help, specially for services companies.

Seth Godin says “Choose your customers, choose your future.” Most of us believe that customers choose us. After having worked with over 200 customers across industries and geographies I have come to realize that companies chose customers just as much as customers chose companies.

Customers tend to take many shapes and forms – game-changers, evangelists, nit-pickers, empathizers, etc. And I’ve experienced all of them. To put method to the madness, and to stay clear from a very long list of adjectives, here is our very own magic quadrant using two criteria:

• Are they easy to deal with?
• Are they profitable to serve and grow?

So, customers fall in to broadly 4 buckets:

Difficult but lots of business: Just like we love Severus Snape – the antihero who unexpectedly became Hogwarts’ savior, the customers in this category are without a doubt my favorite. They are difficult and demanding. But we love them. These are the people who think big, who are trying to make big things happen at companies. They take on tasks and assignments that change businesses – which is what we do. They are passionate and have the highest standards. These are the customers who make us proud of the work we do. The difficult conditions raise the bar for us internally which eventually wins us more business.

Nice with lots of business: This is the rarest breed of customers, probably 1 out of every 100. They tend to be very subtle. Their greatest value is in the references they dole out to other business units. We like them. Who doesn’t like good old Gandalf?

Nice but not enough business: These are the ones we would ideally like to shake off. You see a cupcake, you want to eat it, so you eat it, you enjoy it and then you are done, but not fully satisfied. We want to figure that out as soon as possible and hopefully get a future reference. But we have low expectations so we try, internally, to keep our expectations at a low level. But they are nice, so we still like them because they like us.

Difficult and no business: Logically, this is an easy one. You don’t want to spend cycles in a lose-lose situation. But it takes discipline to walk away and it is a hard decision we are forced to make once in a while. I have realized, chanting ‘Scrooge’ 10 times before taking this call helps lower the burden.

Why do we love Snape? Here are 2 real world examples. Coming back to my top choice of customer, here are some examples of the engagements we have had with the Snapes of our world. These are the stories that force us to be better than ourselves everyday.The client, a CIO of a prominent Fortune 1000 company was extremely and uncomfortably conservative on budget and time. His goal – to build a mammoth enterprise-wide balanced scorecard solution. His stakes – a stellar reputation built over 20 years and the next promotion.  How did we do – we got steamrolled. For the first 3 months, we rebuilt and revamped the Information Architecture and Governance Model three times. It was implemented across 5 other teams in their business in 9 months. Was it tough? You bet. Was it worthwhile?  A $100k PoC that grew to a $3M engagement. Another difficult customer, VP – Technology at a gaming company regularly picked on the quality of our weekly reports and clarity of communications. They raised a red flag at the very first release and complained that the UX could be better. It drove us crazy and quadrupled the frequency of all-nighters but we loved it. We deliveredone of the most exciting online UX for the gaming industry which resulted in new projects across new technologies and new solution areas. Bonus point: 5X learning for the team.

So, how do you find a Snape? What do they look and talk like? I think you should keep your radar on for 4 basic symptoms:

1. They are restless and risk takers. They will take on new projects, bet their reputation on line now and then to get things done.
2. They are paranoid at a ground state. And will go thermonuclear if excited. They tend to have obsessive compulsions for detail.
3. They tend to be extremely well read and well connected within and outside organizations. And their project outlines tend to be foolhardy at first – broad, risky and hair raising.
4. You will have to work hard to earn their trust. Really hard, as they expect people to tune in to their level of excellence. Till you earn it, expect to be treated like they don’t care about you.

Identifying the right type of customer saves time in the short term and contributes to profit and competency growth in the long run. Do you have a favorite type? Let me know in the comments below.

How to SCORE and Win Big in a Critical Meeting

There are times when we as consultants or developers find ourselves in a critical meeting which has a material impact on either the prospects of your company or your own career.  In a design session or a pre-sales meeting, the aim is to have a meaningful conversation, but we don’t necessarily always get to the real conversation.

While there may be many different situations or reasons as to why this happens, we need to understand how to get past it.

So there are three clear facts:

1. If you are unable solve the problem, you will not win the conversation.
2. Therefore you need to understand what the real problem is.
3. Therefore the prospect needs be comfortable enough to tell you what the problem is.

In order to achieve points 2 and 3, let’s discuss why you don’t get to understanding the problem?

1. Taking the happy path: It could be a simple issue of being afraid to get to the point, being afraid to offend, or just being too shy to get to the point in order to make or break the relationship.
2. Can’t ask hard and difficult questions – There also is the case that since the prospect doesn’t know you and you don’t know the prospect, it makes both parties uncomfortable to share their issues in detail. The prospect could have a challenging situation with their tools and/or infrastructure, but the prospect needs to be comfortable and be able to trust you to talk about something as large as that in the first conversation.
3. It’s hard to peel the onion: Every company has some problem – not enough features, not delivering on time or processes that need to be revamped. If you only scratch the surface, then you don’t understand what the real problem is, and any solution you propose is going to be a surface level solution. This makes it impossible to build a relationship.

So, it boils down to how you can become a trusted partner. How do you build a deeper relationship with a customer? Here’s my SCORE framework that I find very successful.

1. Stepping ahead: You need to ensure that as soon as a meeting ends, the ball is in your court. Remember to continually assess the opportunity and decide on what the next natural step is. Ask for a commitment to that next step.
2. Credibility: Why should someone believe in what you are saying? At times, credibility comes from your rank within an organization, the standing of your organization, seniority, past successes etc. In today’s world, leaders build ethos most effectively by demonstrating technical expertise in a specific area (which helps convince people that you know what you’re talking about), and by displaying strong levels of integrity and character.
3. Be outcome driven: Do not take his or her time for granted. Make it clear that you value their time and keep the conversation focused.
4. Research, research, research: If you haven’t researched the company beforehand – about it’s services, customers, the industry, competitors, etc – you shouldn’t be at the meeting. Be as prepared as you can be. You will have a more productive conversation.
5. Empathize: There is great power and importance in making emotional bonds. It is critical to give the prospect your undivided attention and being enthusiastic about the organization’s needs, growth, progress, etc. At the end of the day, empathy fosters trust which will make communication easier.

Which of these do you think is the most important? Is there something that I missed? Let me know in the comments below.