The Digital Transformation Opportunities Ahead

By Mike Sutcliff

The proliferation of digital technologies allows scope for innovation in the way organisations deliver customer experience. Here Mike Sutcliff explores the first steps organisations can take to begin their digital transformation journey.

Mobility, big data, the internet of things, social media, and cloud technologies are changing day-to-day experiences for everyone, from executives to entry-level employees; from casual shoppers to business customers; from university students to even children in nursery school; from patients to doctors. These technologies – which are now commonly referred to as digital technologies – have created an entirely new set of opportunities and challenges for businesses and public sector organisations. Such opportunities and challenges relate to both the customer and the enterprise.

Digital Consumers, Channels and Markets

Thanks to the proliferation of personal computers, smart phones, tablets and other technologies, consumers expect a well-designed, consistent and easy-to-navigate customer experience across all mobile devices – no matter if they are buying something in the store, online, or on-the-go. In other words, they expect at the very least a multi-channel experience, but at the best a seamless omni-channel one.

Consider, for example, how digital technologies have already influenced consumers’ shopping behaviour: more than 70 percent of shoppers now expect to be able to check in-store merchandise via a website, and half expect to be able to buy merchandise online and pick it up in the store, according to a study by Accenture and hybris. More recent research in this area also indicates that these preferences don’t just impact consumer companies: they drive how business-to-business (B2B) purchasers expect to buy from their business suppliers, which could result in a profound shift in the traditional B2B purchasing process that starts with researching products in print catalogues and continues with speaking to a sales representative.

Recognising changing patterns in consumer expectations, many executives agree that digital technologies can help them successfully address and engage consumers and markets. According to a recent Accenture survey of chief marketing officers and chief information officers, for marketers and IT leaders, the top five marketing technology priorities for driving consumer engagement are enhancing customer experience, customer analytics, social media, corporate website, and other web development.

This demonstrates that many businesses have begun shifting their resources towards a digital-first mindset. They are optimising their digital channels for customers, such as leveraging expertise in service design, social media, digital sales, digital marketing, e-commerce and omni-channel commerce. Why? Because they understand that delivering a seamless shopping experience can lead to satisfied, repeat consumers, especially high-value consumers who spend more money with each transaction.

The shopping experience is a deeply personal one, and digital technologies mean that each individual shopper determines the relevance of each experience. They enable businesses to literally talk to each customer individually, something that was unthinkable and unaffordable just a few years ago, but will become an expectation. As a result, companies have a clear mandate to make the most of the technology at their disposal: first, use the data to learn as much as possible about the needs and desires of individual customers. Then, once the themes are identified, find ways to create delightful experiences for customers across all channels. That can be as simple as emailing coupons to all online customers, or delivering targeted, personalised offers to the most engaged shoppers.

Enabling the Digital Enterprise

A truly digital enterprise does more than respond to consumers in new digital ways. It creates new operating models and business processes to replace those that were designed for a non-digital world. These new models and processes, when they are connected to product platforms, analytics and collaboration capabilities, can enhance productivity – thereby freeing up employees to handle higher-level priorities and drive continued innovation. It is essential for organisations to recognise that a digital enterprise is not just a computerised business or government. Instead, it is an organisation that incorporates digital technologies to create results and solve problems for its stakeholders via innovative strategies, products, processes and experiences.

For example, the evolving Industrial Internet of Things (IIoT) is significantly upping the ante for industrial companies, as identified in a recent Accenture report. The IIoT combines sensor-driven computing, industrial analytics and intelligent machine applications into a single universe of connected intelligent industrial products, processes and services. Companies that introduce automation and more flexible production techniques to manufacturing can boost productivity by as much as 30 percent, according to research from Deutsche Bank. The IIoT generates data essential for developing corporate operational efficiency strategies – which points to a key capability organisations must master in order to transform their enterprise digitally: in another research report from Accenture and GE, nearly two-thirds of industrial companies said they use big data analytics to monitor equipment and assets to identify operational issues and enable proactive maintenance.

Already, strategies are being applied across industries in areas such as smart water, smart grid, smart building, smart cities, intelligent pipeline, digital utilities, digital plants, and for other IIoT applications. Consider the example of how a British water company is proving the benefits of smart monitoring capabilities. By leveraging Accenture’s Smart Grid services, the company is using real-time data to monitor assets in an efficient way so as to deliver improved performance. The information and the data help the utility anticipate equipment failures and respond in more real-time to critical situations such as leaks.

The Future of Digital Transformation

Having undergone a digital transformation, organisations will be able to offer new products, services and value to customers, patients and citizens that were not even imagined just a few years ago. But how should companies and governments begin the transformation journey? They will be best-positioned to unleash the potential of digital if they consider the following steps:

Analysing their organisations’ industry value chain. As in most matters for business, organisations must first step back and objectively review their industries, asking: what is changing? Will the industry change around the organisation, or should organisation change first?

Understanding how their organisations’ customers are behaving. Whether an organisation serves consumers, businesses, citizens or patients – how are their expectations or engagement methods changing? Does the organisation need to open new channels or participate in new markets?

Recognising the transformational power of digital. Don’t mistake digital as a set of new technologies to be applied to business as usual. Consider how mobile phones, cloud services, big data analytics and social networks have changed the daily routines of people both in their private and professional lives. Then consider how the axiom that the whole is more than the sum of its parts holds true for digital as well.

Understanding what digital makes possible in their organisations. While the end goal may be a digital transformation, that doesn’t have to happen all at once. By approaching the adoption of a combination of available digital technologies with a strategy, businesses can start with one project at a time, and take it from there. For instance, can you use insights gleaned from analytics applied to data gathered from an individual to inform real-time recommendations for customers, delivered via a social network or direct to their mobile phone screen? Or can you utilise wearables for employees travelling into dangerous environments that can offer them alerts or reminders based on their location?

By viewing the journey in this way, organisations can progress faster along the digital continuum towards the day when digital technologies will be as ubiquitous as electricity, and become a primary tool to drive all aspects of managing and growing a business.

Organisations may benefit from assigning leadership for their digital transformation journey to dedicated digital leaders – such as chief digital officers or chief data officers. Ultimately, though, every leader needs to become not just digital-savvy, but a digital-first leader in the enterprise. They should be spearheading collaborative efforts to breakdown silos and allow data and insights to flow throughout the business under a unified digital vision. Ultimately, every employee will then become digital-savvy, able to not just incorporate new technologies into their day-to-day activities, but use the technologies to drive new services, products and experiences.

About the Author

Mike Sutcliff is group chief executive of Accenture Digital, a part of Accenture designed to integrate digital assets, software and services across digital marketing, analytics and mobility to help clients drive growth and create new sources of value. Mr. Sutcliff is a member of Accenture’s Global Management Committee. Follow him on twitter at @mikesutcliff.