How culture is the key to customer-centric digital transformation

Swamini Khanvilkar thinks a cultural revolution is required to kickstart your customer-centric digital transformation, and provides evidence to back it up.

How culture is the key to customer-centric digital transformation. Image by Vasyl Dolmatov, iStockphoto.com

Digital transformation is more than simply updating your technology and the integral process by which you have been running your business. It involves huge investments by shareholders who expect a higher financial payoff over time. However, the success of your digital transformation is directly proportional to whether you’re implementing it for facilitating your customers better, or for your own business growth. The third (and most likely) reason would be because digital transformation is trending in almost every sector.

According to a McKinsey Global Survey in 2018, more than eight in 10 respondents said that their organisation had undertaken efforts towards digital transformation in the last five years. However, not all of those projects gained some form of success. What did they do wrong? Or rather, what weren’t they doing right? First, let’s look at a few examples:

Jeff Bezos, Amazon CEO, says that there’s just one “secret sauce” to the success of the trillion-dollar company, which is its “obsessive-compulsive focus” on customers over competitors. This approach led to taking risks in order to provide unbelievable deals to its customers, and many of those decisions almost drained Amazon’s profits in the beginning, until they turned out to be a major success (Amazon Prime, for example).

Netflix, truly a Silicon Valley disrupter, has a stock market value of more than $142bn. Being a tech giant whose analytics and algorithms have transformed the way we watch TV shows and movies, Netflix used big data to study the viewing habits of its 125 million subscribers. In 2005, Reed Hastings, CEO at Netflix, said about its digital streaming innovation and compelling strategy, that the real problem they were trying to solve is how do they transform selection so that customers could find a steady stream of entertainment they prefer, while giving everyone a platform to broaden their tastes.

Recently, Mark Drasutis, chief digital officer at IAG, mentioned in an interview that it’s no longer about the insurance products, but about predicting and protecting the world around customers. By digitalising the business, they can actually interpret the right signals for their customers to predict and protect their world.

Moreover, when two companies come into a partnership agreement, there are various elements aligned in terms of profit, longevity and long-term success. But it’s always interesting to see how they justify their partnership to their customers. When announcing a new partnership in a LinkedIn post, Satya Nadella, CEO at Microsoft, wrote: “Each of us needs a digital identity we control, which provides us a secure, instant way to verify our identity with whomever we want, whenever we want. We’re partnering with Mastercard to make this vision a reality.”

So, regardless of the size or nature of your business, you need to understand that digital transformation begins and ends with customers, and one of the best ways to start understanding your customer better is by mapping the customer journey.

Customer journey mapping

Today’s customer is demanding in what they want in terms of simplicity, accessibility and so much more. On the other hand, companies are looking for ways to quickly get more customers. It has become crucial to focus on customer journeys rather than customer life cycle, along with understanding a customer’s present situation, future ambitions, desired outcomes, as well as their preferred journey to reach those outcomes.

A customer-centred business operating model involves customer journey mapping, customer insights and feedback. If you could harness the right data and use it intelligently across the customer journey, you could create a happy customer and solve many immanent inefficiencies. So it’s important to reimagine the entire journey and reinvent a compelling customer experience.

Cultural evolution

Understandably, having the ability to deliver outstanding customer experience remains the key aspect to win in the market, but in order to witness a fruitful digital transformation, companies need to undergo a cultural evolution in the first place. The culture that places customers at the heart of the transformation process (instead of the product) ultimately excels at digital business strategy.

However, according to a March 2018 blog post by Alyson Clarke, principal analyst at Forrester: “Changing the internal culture consistently surfaces as one of the biggest barriers to digital transformation. And while the wrong culture will do more to impede your progress than any other factor, many digital leaders try to ignore it, because as a soft competency, culture is one of the hardest aspects of digital transformation.”

In a BCG study of 40 digital transformations, the companies that focused on culture were five times more likely to achieve leading-edge performance than companies that neglected culture. A good digital culture enables your team to work resourcefully while delivering outstanding results.

Our digital culture at ieDigital demonstrates five key traits:

  1. We’re customer-obsessed
  2. We’re empathetic
  3. We’re agile
  4. We’re experimental
  5. We’re collaborative.

Getting your digital culture aligned with customer-centricity is the first step towards a successful digital transformation. How far along are you?


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