Riding the wave of digital disruption
Riding the wave of digital disruption
How to stay ahead and capitalise on the opportunities offered by disruptive digitisation
Rapid evolution of technology is rapidly changing how companies deliver value to their end customers. Delivering a product or service is far more complex today than a few years ago. This is attributable mainly to a significant increase in the number of participants in the global supply chain and the increased product complexity from rising customer expectations.
New digital technologies have lowered the entry barrier to several industries and new start-ups are fast changing how value is created and distributed by all participants of an ecosystem. In this environment, the success of an organisation is often dependent on the success of other members, within the ecosystem, that the company partners with. It is not uncommon to find companies, which have survived for decades, forced to change their business model under pressure from new start-ups in their systems.
So, how does an organisation ensure it can stay ahead and capitalise on the opportunities offered by disruptive digitisation?
To capitalise on the opportunities offered by this digital shift create a high performing organisation that sustains continuous customer centric innovation
The last decade has offered new digital tools and methods that enable organisations to methodically manage a much higher volume of new ideas and continuously convert into real products and services personalised for much smaller cohorts of customers, without significant risk. Successful organisations have combined this use of new technology with a managed shift in the organisation culture to create a high performing customer centric organisation.
Well managed continuous innovation can yield sustainable competitive advantages
Consumers live in an experience economy and base their decisions increasingly on their experiences before and after buying a product or service. It is vital for an organisation to continuously and frequently offer better experiences to customers in order to stay ahead of competitors: this is where it can leverage the concept of continuous innovation. This is true not just for digital products: it applies equally to other industries such as consumer goods, utilities, financial services, etc. A case in point is the story of the Whirlpool Corporation, which transformed itself into an innovation powerhouse (between 2008 and 2013) while generating relatively significant shareholder value and employee engagement in return. The key goal of continuous innovation is to be first to the market for new or renewed products and services, combined with validated learning to pivot when necessary and the ability to rapidly scale.
Commit to be the leader for your customers
Organisations that manage the process of innovation successfully are often the leaders for their customers. They give a voice to the implicit customer needs, methodically invest to study customer challenges and experiment to find sustainable initiatives that provide unique customer experiences. The critical success factors for organisations to innovate continuously and effectively are:
- Commitment: The first stage in transformation of an organisation to an innovation powerhouse is to acknowledge the opportunity – for the customers, employees and shareholders. This helps the organisation frame its commitment to continuous innovation and build a solid foundation for the process of innovation. This commitment is essential to ensure sustainability of the initiative and drive clear line of sight of the expected benefits
- Framework: Develop a solid tailored innovation framework for employees, customers and partners to participate in the co-creation process. Such a framework is often characterised by a set of principles to ensure each idea is considered, transparently prioritised and developed using methods of validated learning, with clear roles in the organisation to drive these processes. Ad hoc initiatives to use agile practices or conduct ‘hackathons’ and set up internal venture funds will not yield sustainable results without a well thought out framework and sponsorship.
- Scan: Successful innovations often rely on nimble partners in the ecosystem to support the delivery of a new product or service. Because new ideas emerge from a variety of sources, it is vital to continuously monitor and inform the executive leadership of the emerging risks and opportunities in the partner and competitor ecosystem
- Open and nimble: Create an environment of top-down transparency such that participants have a clear view of company challenges. Similarly, develop processes for executive appreciation of customer challenges and opportunities. This shared understanding when combined with an open attitude to controlled experimentation within the robust innovation framework can yield quick and significant results. Organisations must leverage new tools to manage ideas; co-create with customers and partners; use democratic means of prioritisation; and agile methods to develop and test the product or service with real customers.
Disruption is ever present. The opportunity lies in readying the organisation to meet the challenges. Get in touch for more information.