Why read this? : We look at the difference between what digital transformation should do, and what it actually does. Learn the real question which should drive transformation, and the real role of digital. Read this to learn why time’s up for digital transformation.
The idea of digital transformation has been around for a long time. But it only really took off as a business approach during the second half of the 2010s. And interestingly, Covid seems to have flattened interest in the topic, if search trends from 2020 to date are anything to go by.
In fact, there’s a real air of the marketing product life cycle about the shape of digital transformation searches. Slow to get going. Then rapid growth. And now, a sort of on-going “maturity”. If it continues to follow the lifecycle, decline is coming soon. And to be honest, we’d be glad to see the back of digital transformation in its current state.
Digital transformation - abused and misused
It’s not that we’re anti-digital. Far from it. We see big opportunities in the online and technology space.
Nor are we against the idea of transformation. We’re always open to looking at how to make thing better.
No, why we believe digital transformation is past its use-by date, is because of what it’s become. The way it’s been so badly abused and misused as a business idea.
What it’s become isn’t what it was intended to be when it started.
Clearly, digital and technology has hugely changed the way we interact with the world, and with each other. You wouldn’t be reading this if it hadn’t.
And for businesses, it presents a new challenge. Customer lifestyles and expectations have changed.
Digital transformation should really be about how companies change to fit into this new reality. How they serve customers better in this more digitally enabled world. But in most cases, it doesn’t do anything remotely like that. Quite the opposite in fact.
Where digital transformation should fit in
It’s not like it’s that hard to work this out. As per our digital business model guide, there’s 3 main strategic areas you should think about when trying to make your business more “digital”.
This is what businesses should be doing with digital.
First, there’s the external analysis and objectives which focuses on customers.
How you reach them with digital media. How you engage them with great customer experiences. And how you convert those into selling via e-Commerce to grow your business.
Then, there’s the internal capabilities you need to do this.
Your ability to run the right marketing technology. Your data and analysis skills to convert digital insights into better customer experiences. And all the resources (e.g. people, time and budget) needed to be able to do all this.
Lastly, there’s the change plan you need to get from where you are now, to where you need to be to maximise the digital opportunity.
That plan is what digital transformation should be. But, it’s where it all seems to go system-crashingly wrong.
The time and effort of digital transformation
Let’s be fair. Change is never easy. We’re genetically programmed to be wary of it.
It takes time and effort to force ourselves to change. Whether it’s a new exercise regime, updating our passwords, or learning a new skill, change is long, hard work.
That’s especially true with digital transformation and all its new skills.
Learning how to gather digital insights and use them.
How to use social media to connect with your customers online. And how to set up your own online store, so you can sell direct to customers.
All those take time and effort.
And where it mostly goes wrong is the time element. Most business leaders find time is their scarcest resource. There’s never enough of it.
They flit from meeting to meeting, never getting a chance to think deeply.
They rely on stock leadership soundbites and executive summaries to scramble through their day, trying to make decisions which won’t get them fired or laughed at.
And when they see so many online mentions of digital transformation, they fear they’re being left behind. That they’re missing out. That with what little time they have, they need to do something about digital transformation.
Vulnerable to the digital sharks
Which means they’re vulnerable to the management consultant and agency sharks out there who promise them easy and quick paths to digital transformation.
Many companies try to “do” digital transformation by hiring these expensive consultants to come in and run workshops. But digital transformation doesn’t happen in a day or two. It takes time. And effort.
So in these workshops, the consultants show lots of fancy Powerpoint slides and funky videos.
There’s breakout sessions and discussions, using the ironically non-digital medium of post-it notes.
And afterwards, the consultants circulate a list of key actions and some sort of roadmap to digital transformation.
And at first glance, that sounds fine.
Except when you follow up on what happens next. Because, usually it’s very little. That’s mostly because the leaders who attend those workshops aren’t the right audience. They’re not the ones who’ll be doing digital.
For a start, they don’t really get what digital is. They don’t have the right skills and expertise to deliver it. Plus, they didn’t get into their leadership roles by being good at digital. So they’re not really motivated to get into the depths of how to do it now. They’ll never admit it, but it kinda scares them.
So, they farm the actions out to their team, who usually weren’t at the workshop. Then, they go back to their cycle of (non-digital) meetings and whatever else it is they spend their day doing. At some point, maybe 6-12 months later, someone asks how the whole digital transformation thing’s going. And all they can say is they’re still working on it.
A big consultant bill for an almost non-existent transformation.
People drive change and transformation
The key part that’s missing in these workshops is usually about how important people are to digital transformation. It’s people who drive the culture in the business, and without people nothing happens.
But here’s the thing. People at work generally don’t want to be transformed.
Most people are usually fairly happy doing what they’re doing. Maybe a promotion at some point? A pay rise would be good. Oh, and if they could stop Derek from Finance heating his fish curry leftovers in the office microwave at lunchtime, that’d be great.
But nobody really goes to work wanting to be transformed.
This is what leadership teams and consultants generally get wrong. All that digital “stuff” like digital media, technology and e-Commerce are just the tools you need to do digital. But, they’ll sit there uselessly until you motivate and train someone how to use them. To show them what it’s for, and how it helps them do their job better. These are mostly small, incremental changes to make life better. The actual life-changing breakthrough transformations in digital are actually few and far between.
Big digital transformations are few and far between
There aren’t many upsides to the pandemic, but it did force many businesses to think more radically about what digital and technology could do for them. Businesses who weren’t already using online had to get there, and get there fast.
But with your 2023 hat on, what’s really that different in terms of technology from 2020?
If you screen out all the flavour-of-the-month technology breakthroughs (Chat GPT, Web 3, the Metaverse and so on), none of which have really stuck, it’s not that different.
In fact, go back 30+ years to to identify all the really big life-changing digital breakthroughs, and most of them only come along every few years, if that.
It clearly kicked off with the public launch of the World Wide Web in 1993.
Then, you had the start of search and e-Commerce, with companies like Netscape, Yahoo and Amazon all starting in 1994.
But then it’s all boom and bust until you get the next big trend which stuck, which was social media in the mid 2000s. You had early runner MySpace start in 2003, soon to be crushed by the still dominant Facebook which launched a year later.
Then, you’ve got some big technology leaps, mainly led by Apple with the iPhone in 2007 and the iPad in 2010. Touchscreens changed how we interact with the online world.
But since then, it feels like the big leap forwards have all slowed down.
Nothing so breakthrough. Everything’s just a slightly better version of what came before.
A slightly better version of what came before
For example, the iWatch is basically a small iPhone with a wrist band.
Video calls were around in the late 2000s (Skype started in 2003), but it’s only in the last few years, the bandwidth technology has improved enough to make them more reliable. Though clearly there’s still an opportunity to make them more enjoyable.
Ditto with TV streaming, which Netflix first offered in 2007. But that’s only really become the norm in the last few years.
And yes, we now have more, and more reliable choices in e-Commerce. Getting booze delivered in 30 minutes (see our online alcohol article), or those funky new Converse shoes delivered the next day (see our online fashion article) is good.
But, are these really that breakthrough? Are they life-changing? Aren’t they just saving us from the time spent going to the store, time we’ll probably spend flicking through more shopping sites on our phones?
What we have seen though is a boom in unfiltered content. Social media means anyone can put anything and everything in front of you, the customer. Badly thought out, poorly edited junk content clogs up our social feeds all day. While you try to clear the worst of it by blocking, deleting or complaining about anything that’s inappropriate, it’s an exhausting battle to not be drowned by this tsunami of terrible content.
And that’s really where digital transformation needs to be something different to what it is now.
Digital transformation asks the key question the wrong way round
Digital transformation goes wrong in most businesses because it asks the wrong question.
Or to be more exact, it asks the question the wrong way round.
It’s not about how to use digital to transform your business. It’s how your business needs to transform, and then how digital helps you do that.
You have to decide on the change you need first. And while digital is almost always part of that, it may not be all of the change.
That’s the key part.
Digital is part of your transformation, but it’s rarely all of it.
So you go through your basic strategy process.
You do your external analysis, looking at the market and your customer insights. Part of that is looking at what digital and technology means to them. How they use it. What needs it helps them meet. You look for opportunities to better meet those needs with digital services and experiences. But if digital doesn’t fully meet those needs, you’ll need non-digital activities in your change plan too.
Then it’s your internal review. Your capabilities and your culture. Your people, leadership, systems and resources. You work out if you have the right business set-up to meet the digital opportunity. If you don’t, you work out what you have to change to make it happen.
That’s your digital transformation.
It’s this change in thinking and approach which has to run through all levels of the business. It’s not just the low-level workers who need to transform. It has to start with the beliefs and actions of the team at the top. It needs their commitment to use digital to get closer to the customer.
Digital transformation should bring you closer to the customer
Digital transformation should bring you closer to the customer. Sounds obvious when you say it, but it’s actually hard to do.
It’s back to that time and effort commitment.
You have to get past all the distractions. See through the detail of all the digital data and technology to see the real people behind the numbers.
Digital distracts marketers with charts and spreadsheets, jargon and buzzwords.
It makes them forget there’s real flesh and blood customers out there whose needs have to be met.
If you were really all about the customer, you’d really question much of what digital transformation has done. Much of what it’s done is make life harder and more annoying
Retargeting, ReCaptcha and Recommendations
Take retargeting media, for example. The numbers show it increases sales by a few percent. Great. But they don’t show the annoyance levels of customers who looked at your website once, and now have to see your advert 3 times a day for the next 3 weeks on social.
Recaptcha is another. Great that it stops automated bots and helps with picture recognition.
But those 5 seconds it takes everyone to identify traffic lights or taxis, soon add up. Especially if you think about the time of everyone in the world who has to click on those stupid boxes. Who’s it really helping, because it’s not really helping customers, is it?
And then there’s all those helpful recommendations you get on e-Commerce stores. Other customers who looked at this also bought this other random object you’ve no interest in. Again, it’s another digital transformation activity which may add a few percentage points to sales. But it distracts and annoys many customers with unwanted invitations to buy more crap they don’t really want or need.
Getting closer to the customer should be easier with all that data. But it seems like many brands have no idea how to use it.
If digital transformation is going to survive much longer, that ability to use it to do useful stuff for customers is about the only reason you can justify not letting it decline and die.
Conclusion - time for digital transformation to decline and die
As we said at the start, we’re not anti-digital. We’re not anti-transformation. We are against using digital transformation as a way to deliver experiences which are bad for customers, though.
If you really want to transform your business, it has to start with customers. What they think, feel and do, What they need, and how you can help them.
If you know how to use it properly, digital and technology can open up so many amazing opportunities to meet customers needs.
It drives us crazy how many businesses fail to grasp what’s right there in front of them as they’re led astray by overpromising and underdelivering consultants and agencies.
You should look at transformation as part of your digital planning. But it has to be specific to your customers and brand. There’s no uniform way to transform, because everyone starts from a different place. They have a different context.
Your end game in digital comes down to what’s best for you, and for your customers. It’s really the customer focus that’s the transformation. Digital is only a tool you use to help you get there.
Check out our digital business model guide for more on this topic. Or get in touch if you’d like a chat about what digital transformation should be doing for your business.
Photo credits
Angry face : Photo by Andre Hunter on Unsplash
Man crying : Photo by Tom Pumford on Unsplash
Clock : Photo by Agê Barros on Unsplash
Hands : Photo by Clay Banks on Unsplash
The Journey is on : Photo by Clemens van Lay on Unsplash
Social media and facebook : Photo by William Iven on Unsplash
Netflix: Photo by Kon Karampelas on Unsplash
Question mark sign : Photo by Emily Morter on Unsplash
Customer Experience Coffee Shop : Photo by Patrick Tomasso on Unsplash
