Keep up with new content on the site, receive exclusive content and commentary, and learn about activities within the Straight Talk community.
Nearly every company has a digital business strategy these days. Here are five pieces of advice that can help make that strategy a reality.
By Jora Gill, Chief Digital Officer, The Economist
The media industry has been significantly disrupted by digital and has spent the last decade reacting to this challenge. The Economist, where I serve as Chief Digital Officer or CDO, has experienced first-hand what it means to go through a digital transformation, and like other leading media organizations has applied digital thinking to its products, customer relations, and the development of online communities.
But no matter what business or industry you’re in, becoming a digital enterprise undoubtedly is – or should be – central to your strategy. It used to be that you had a separate technology strategy and a separate business strategy and you made sure that your technology strategy was “aligned with” your business strategy. But today, digital strategy and business strategy should be one unified strategy. Digital thinking should permeate everything you do as a business, whether it be driving into new markets or generating new value.
That has led to the new role of the Chief Digital Officer with its key responsibility of bringing together the digital approach and the business strategy. The CDO position fuses together elements of the traditional CMO and CIO roles. The CMO is focused on building the best marketing capability but typically does not have the technology background. The CIO has the technology expertise but is usually focused on building a robust IT infrastructure and providing services to internal customers.
Specifically, the CDO position has two important dimensions: customer perspective and digital thinking. Representing the customer, the CDO asks: How does the customer look at us? What’s the customer journey like? Is it an enjoyable experience? Promoting digital thinking in the organization, the CDO asks: Who could disrupt us? Should we disrupt others? How are we going to truly take advantage of digital and not just treat it as an add-on to the wider business strategy?
A very important element of the make-up of a CDO is the willingness to experiment and being comfortable with not having “answers” or “solutions.” While the work of the CDO is open-ended, I’ve discovered a number of successful practices in my work at The Economist and in previous technology management positions that may help you in the task of creating a digital enterprise, in any industry.
1. Identify the specific challenge you are trying to solve digitally
First and foremost, you’ve got to know what problem you’re trying to solve with digital technologies, practices, and processes. Try to be as specific as you can be and identify a challenge that has a specific impact on your business today.
An example would be not having a single view of the customer, the absence of which does not let you cross-sell products that you believe the customer is interested in. Another example, from my experience at The Economist, is looking at what happens when someone becomes a new subscriber or registered user and improving their experience—what options do we give them for logging on, how easy is it to change their relationships with The Economist, can they manage their account completely online without having to call us, and so on.
2. Build the digital capabilities you need – and integrate them
Having clearly identified your specific challenge, consider whether you have the right digital capabilities needed to answer it. Do you need to be in the cloud so you can crunch a lot of data? Do you have a business intelligence strategy? How do you go about hiring and developing data scientists?
You need to understand the gap between what you have in terms of digital capabilities and the specific challenges you are trying to address. You’ll know if you’ve got the right capabilities by the speed in which you can launch new digital products.
Most important, don’t create new silos when you go about expanding your digital capabilities. All the different elements of your digital strategy and execution must be connected seamlessly, from where the data resides to the analytics to insights leading to actions.
At The Economist, the specific challenge we started with—improving the user experience—turned into a new content strategy. Based on data analysis showing that readers increasingly access our content with their smartphones, we have developed new content repositories tailored to mobile devices and then decided to host these in the cloud. We connected the data to the development of new digital products to decisions on how to support our new digital capabilities.
3. Create cross-functional, product-aligned teams
Instead of organizing your teams by type of skills—developers, business analysts, etc.—you should create cross-functional teams. Instead of aligning by function, you should align the teams by product. This way their passion is focused not on their specific work, but on the product. Instead of saying “I’ve written my code. My job is done,” they are willing to experiment, to push forward and interact with other members of the team. They want to see the product succeed.
When we aligned cross-functional teams around specific products at The Economist, I’ve found it encouraging that the people which were responsible for testing different options online were looking at the data analysis and asking questions as if they were product managers. A good understanding of the product is key to having everybody on the team, regardless of their skills and specific responsibilities, actively participate in ensuring the success of the product.
4. Experiment, experiment, experiment
We’re constantly changing our product and we’re constantly making small releases to see what would happen and we’re constantly collecting data on it. But it isn’t experimentation for the sake of experimentation. We expect our teams to experiment based on the quality and quantity of feedback from our customers.
Many organizations have this concept of a “hack day” and they make such a big deal of it. With us, every day is a hack day; it’s part of our DNA, of our agile mindset. We constantly change our product, making small releases to see what happens, and collecting data to learn from our experiments, including the ones where we failed to get the desired outcome.
You can’t think too long-term when you’re working with digital capabilities. It’s Moore’s Law—the rapid advances in computer technology and its new applications make long-term planning a futile exercise. You’ve got to have a mindset of agility across everything—your customers, your teams, your internal systems. You’ve really got to start thinking about it like Lego. Be comfortable telling everybody “in a few years’ time, we’re going to have to take this apart and rebuild it.”
5. Make the customer part of your development team
The customer is an important component of our digital development ecosystem at The Economist. We have 5,000 people who said they’d love to help us develop our next product. All we did was ask if anybody is interested in testing a new app.
Many companies are focused too much on process and product development and looking at customer feedback after the product is released. Instead, they should actively develop communities and focus on speed and collaboration. If you get small releases out early, then your feedback loop is early and so is your ROI. Extend your development team to include customers every step of the way.
In the digital economy, the power is with the customer. The feedback from customers gets to you much quicker than ever before and that’s a good thing. But because of digital technologies, it is also so much easier for them to switch to your competitors. If customers can switch in a heartbeat, you must have a strategy and an approach that will give them a great experience and get them engaged and even directly involved very early in the product’s lifecycle.
Many companies think they’re not digitally disrupted yet, but they will be very shortly. By the time they realize that, it’ll be too late because a newcomer has built the capabilities, the loyalty, the customer experience and has got the data analytics to know what they want next. Even if you’re in manufacturing and you think you’re not going to be impacted by digital technologies, you should start your digital journey now. Companies that have not figured out what makes them digitally valuable to their customers are going to fail.
At The Economist, we’ve been known for more than a century and a half for our weekly publication. But now, digitally, we can even challenge our own business model. We developed an app called Espresso that each morning delivers five short-form stories. What was important in developing Expresso was not the app itself but what it represented—a new way to reach our customers and potential customers and a new business model.
Digital is more than producing an app. It’s more than figuring out who and what can digitally disrupt you. It’s re-thinking your business model and pursuing the new business opportunities opened up by new digital capabilities.