Truly embracing digital is not an evolutionary change—it is revolutionary change and touches every aspect of the business. As such, it must start with CEOs and the board. It can neither be delegated, nor can it be implemented without fundamental changes to people, processes, and technologies.
In partnership with SSA & Company and based on our work implementing digital strategies in the trenches alongside CEOs, boards, and their teams, I have compiled several key takeaways for CEOs to consider as they cut through complexity and successfully transform their enterprises for the digital world.
1. Ask Big Questions. How can our company use digital to do what our company does best better, faster and cheaper? How can digital tools, technologies, and capabilities help our company meet or exceed its business and organization goals? How can digital get our company to its current goals? How can we use digital to do what my company does best, better, and faster? How can digital help improve the lives of the consumers we serve? What would happen if my supply chain took a day, instead of a month? How can we use digital to improve the customer experience or service? What if I knew which of my investments were paying off sooner? Ben Horowitz, of venture capital firm Andreessen Horowitz, is fond of telling managers to think about how they would they disrupt their own business—and if they have a great idea, implement it—or better yet come to him for funding.
2. Know Your Digital Starting Point. Many companies don’t know where to start and therefore end up doing nothing or starting in the wrong place. CEOs must understand how their starting place stacks up to competition and focus on best-in-class competition, not industry averages. Averages get you to the middle and that is not where you should strive to be. CEOs must understand where the digital opportunities lie in terms of overall strategy, and how to allocate resources for the best ROI. But more than anything, it’s important to stop talking and start doing. Even small, targeted projects generate momentum, break down resistance, and create “shiny objects” that generate more demand for change. You want a thoughtful approach—but don’t let that be an excuse for a deer-in-the-headlights reality.
3. Aim High. These days, it’s go big or go home. Digital is an investment for the present and future. CEOs must hold the company accountable for driving results and ROI for digital efforts; for many industries, digital is truly an existential threat or once-in-a-lifetime opportunity. Remember, change today is not the incremental 10-20% we expected in the past—it’s exponential.
4. Capture the Hearts and Minds of Consumers. Change and digital transformation are occurring at an exponential pace. We need to review, rethink, and reimagine the consumer journey, which is increasingly a digital journey. Our R&D, marketing, sales, and operations teams must broaden their view and definition of the consumer path to purchase, which is increasingly an omni-channel journey that moves in and out of digital and physical worlds. We must ask ourselves: how we can we use digital to reach our target consumers and customers where they are today, and learn/experiment with how to reach them where they will be tomorrow? We must understand how to digitally engage with consumers in ways that are helpful but also respect their privacy and protect their personal information. These considerations need to work their way into and inform our business vision and forward-looking strategies and actions plans.
5. Prioritize and Measure. Digital transformation does not mean forgetting the axiomatic objectives of ROI, profitability, and growth. CEOs must study the external landscape and assess their companies’ digital capabilities and opportunities to prioritize specific initiatives based on returns, feasibility, and long-term strategic impact. Furthermore, digital projects must have clear, measurable impact to your customers, cost structure, and team.
6. Unlock the Value of Data. Big data and advanced analytics are the heart of digital transformation. Yet, many businesses have only scratched the surface in converting analytics insights into data-driven decisions that drive value. Build capabilities that enable business users to find and use the information they need to make the right decisions and take the right actions. Your leaders should be able to explain not only what happened but why.
7. Use Technology Wisely. Technology is a means to an end, not an end unto itself. Understand your priorities first then employ the tools you need to execute against them—not vice-versa. Today’s open source technologies do not require the same high upfront expenditures or the long implementation times of yesterday’s ERPs. Lastly, don’t make perfect the enemy of the good. You can make plenty of headway even if your current technology infrastructure is not fully modernized.
8. Address Capabilities and Culture. This point cannot be overstated: people and culture determine the success or failure of your digital transformation. Build your digital capital strategy into your plan from the start and continuously evolve it. Digital will only deliver value if you have the right people, in the right place, with the right data, tools, processes, and behaviors to change decision making and operate in new ways.
Digital represents one of the CEOs biggest opportunities and challenges of our time. CEOs must build smart strategies and business plans that weave digital into the very fabric of their business models and organizations. Digital has permeated all walks of life, impacting both businesses and their current and future consumers. CEOs and their C-suite leaders cannot afford to sit back and slowly adjust to these changes. They must get out in front and lead their business towards this increasingly digital future, defining new ways to use technology to improve the lives of the consumers they serve.