Gästkrönika: "Digitize but don’t forget the basics"

In most industries, the market landscape is changing at an unprecedented pace and scale. Transparency is greater than ever, customers have become more elusive and harder to segment, values like ethics and sustainability have become major purchasing factors and new disruptive business models are challenging incumbent firms.

Needless to say, the underlying superforce behind most of these changes is digitization. Some firms find themselves in the eye of the storm, while others are still watching it approach rapidly. We see digitization fundamentally affect all growth levers of companies:

• For Branding, it forces transparency and dialogue into brand communication, since the brand nowadays is conveyed by everyone, every day. Eventually, traditional brand policy control will become impossible and must be replaced by a focus on corporate values.
• In the Offering Development area, new digital offerings and business models are created every day. Connected services are replacing traditional transactional revenue models, enabled by the rapid deployment of Internet of Things. Pricing practices are becoming much more sophisticated as ecommerce offers new levels of flexibility and responsiveness to customer behavior.
• The superior Customer Experience delivered by leading digital firms sets new standards way beyond their own industries, forcing all organizations to refocus their processes based on customer journeys.
• The ability to identify and track individual customers’ digital behavior creates vast opportunities to personalize communication and optimize sales and marketing efforts based on the Customer Life Cycle.
• To take advantage of the above opportunities, companies’ Frontline Operations is being fundamentally transformed. Agile working methods, originating from IT development, are rapidly gaining ground also in the commercial functions. Firms are redesigning processes, creating new roles, acquiring new competencies and setting new principles for governance. And, of course, implementing modern digital tools.

Reading this list, it is easy to be blinded by the overwhelming power of digitization. And yes, the lack of digital competence in front-end functions is in fact the greatest obstacle for growth in many firms today.

Having said that, we often forget that technology is only a means to an end. Fundamentally, achieving sustainable growth is still a craft that requires a multitude of different skills; creative height, deep business understanding and analytic discipline. Digital competence does not replace these fundamentals, it complements them.

The bullet list of examples above represent different growth levers that companies possess. Successful use of these levers requires a mix of the three fundamental skills, and the new one. Only through a combination of perspectives and expertise, truly unique solutions can be crafted and executed to boost growth.

Consider the construction of a new house. It needs a solid engineering foundation, an attractive design, sustainable materials, as well as innovative technology solutions that will attract both the minds and hearts of the owners or tenants. And in the end, it must also pay off financially. The required skills to achieve this do not come in one single individual or function, but well-balanced and high-performing teams can build outstanding houses.

Who are building your growth house?