What is customer-centric digital transformation and why does it matter?
It matters because if it doesn’t, you can’t expect a sustainable change. I’ll start by sharing two stories about two similar organisations, both undergoing transformation but with two completely different approaches or mindsets. Both were trying to implement a digital solution to solve a customer pain point.
Mindset one – being first is best.
The people at this company knew that digital was the new hot agenda item. To fight the disruption they would need to be first and digital. After all, McKinsey has stated that in the majority of cases you are more successful if you are first. Being first is best.
Each business department started to build their own version of a customer-centric digital business model. They lacked an understanding of what each digital business would look like, why they were doing it and what it meant to the organisation as a whole. There wasn’t a common alignment to what the digital agenda was, or how that would play out across the enterprise leading to a fundamental issue.
In addition to this, the hype generated around new technologies can often lead to the purchase of individual solutions to solve a customer pain point, providing short term gains but no solution in isolation will deliver a true customer outcome. Without understanding the desired business model, you end up with a piecemeal collection of digital components and a fragmented customer experience.
Mindset two – align behind the customer.
Here, people have a greater focus on true customer-centric digital transformation. The group realise pretty quickly that launching a new digital portal is just the beginning of their transformation journey. After the excitement of the launch and promotions subside, the majority of people still went back to physical stores to complete basic transactions that were now offered online. Building the portal wasn’t enough, nor was training the team members on how to educate the customers. The whole organisation had to reorientate its activities to sustain the digital culture. Roles needed to be adjusted, continuous communications needed to go out to educate customers, developers needed greater access to customer feedback to continuously improve the experience. Within the first few months, the portal use increased by 70%, reducing manual costs of onboarding customers while doing it 60% faster and employee engagement improved overall too.
What can we learn from the two different mindsets?
To really embed digital, it needs to be an enterprise-wide transformation with a focus on your people, not just your technology. Any significant transformation project needs to be motivated by delivering a better experience, both for the customer and the employee.
- Have a clear understanding of what the strategy is and the architecture that you need to achieve it.
- Use data to further understand user behaviour and their decision-making process so that you can enable technology to help shape that journey whilst creating new ways of working and ways to consume the services.
So what defines a customer-centric digital transformation?
- A holistic business model that clarifies why the transformation is happening, what it means to the organisation and what the organisation will look like following the transformation.
- Customer data-driven; a connected system across business silos, backed by real-time data that provides insights on customer behaviour and decisions to help map and create new journeys and experiences.
- An enterprise approach that is embedded throughout the entire organisation. It isn’t just the app, it is part of your daily operating rhythm, your operations management and it’s embedded in your culture.