Digital transformation involves all parts of a company, from sales and marketing to operations, supply chain, and talent. In this episode, a seasoned leader and author shares practical leadership advice for undertaking a program of digital transformation.
Our guest is Anurag Harsh, Senior Vice President and Founding Executive at Ziff Davis.
Michael Krigsman is an industry analyst and host of CXOTALK.
For more information, see https://www.cxotalk.com/advice-digital-transformation-svp-ziff-davis
Check out all the CXOTALK episodes: https://cxotalk.com/episodes
From the ZDNet article: http://www.zdnet.com/article/digital-survival-the-transformation-imperative/
Why is digital transformation so important?
In the last fifteen or sixteen years, more than half of all Fortune 500 companies have become insolvent, been acquired by another company, or stopped doing business altogether. And if you just look at last year, 50% of Fortune 500 companies declared a loss. So, the stride of transformation has become a revolution. Rivalries have deepened, and business models have been dislocated. The only constant is the growing severity of digital disruption.
Because of disruption, there’s despondency, and that’s compelling companies to want these digital initiatives. And they are investing a lot of money, which mostly results in disappointment due to the absence of concrete strategy. As markets shift downward, many companies try to counter the spiral by initiating frantic investments and digital initiatives. Some of them are hiring Chief Digital Officers, and some of them are looking at their CIOs and CMOs to counter these disruptive effects.
What is authenticity in digital transformation?
Consumers expect authenticity from corporations and individuals alike. As consumer psychology changes, digital and marketing must enter a new era where human needs — values and connections — define success and failure. This is a call to action for marketers and advertising executives to change their perspective towards consumers.
Companies can no longer see consumers as gullible moneybags or conquests. They must see consumers as community members, as human beings, who crave trust.
You see the theme here? We’re talking about technology and digital, but what I’m getting at is connection. Consumers crave trust: predictability, transparency, respect. I call it the relationship era.
Your corporates value must resonate at every level of infrastructure. It has to emanate outwards to the company’s employees, customers, suppliers, stakeholders, neighbors, and even your relationship towards Earth! Merely projecting an image is akin to falsity. Companies must steadfastly practice what they preach.
The public today cares not only about the cost and quality of products and services. People also care about the values and conduct of the providers. Trust, reliability, ethics often supersede quality and affordability.
Describe your model for digital transformation?
There are five things that companies need to think about. These are terms I use:
Oiling the hinges
Structural swivel. If you talk to any CTO or CIO they have all legacy systems and techniques that can impede their ability to execute. By altering the company’s configuration to spotlight digital initiatives, executives can swiftly escalate the speed of transformation. It’s tactic that requires earmarking funds, and human resources to digital initiatives and placing digital executives in command of existing business processes.
Inverse acquisition. There are a lot of businesses that have unearthed quick wins ─ quick triumphs ─ by placing boundaries on the digital products so they can function autonomously and uninhibited by traditional processes. Just put them in a corner somewhere. It’s like, “Off you guys go!”
Offshoot. It’s unrealistic always to expect a new digital operation to absorb the traditional business, especially if the digital business is not yet developed sufficiently to absorb a larger unit. Also, it may focus on too dissimilar a fragment of the value chain.