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Trends And Innovations
Marketing Problem #3 – Digital Transformation of the Modern Corporation
This is #3 in a series of posts to address what the AMA has identified as “the seven big problems” confronting marketing today
- Effectively Targeting High Value Sources of Growth,
- The Role of Marketing in the Firm and the C-Suite,
- The Digital Transformation of the Modern Corporation.
- Generating and Using Insight to Shape Marketing Practice
- Dealing with an Omni-Channel World
- Competing in Dynamic, Global Marketing
- Balancing incremental and Radical Innovation
The 2016 PSAMA MarketMix conference was themed “Are You Ready for the Digital Revolution”. We recognize that a mere revolution of current business strategies will not be enough to succeed in the future. .Forbes Magazine predicts that a complete digital transformation will become the key strategic thrust for most CEOs in the future.
But what is “digital transformation”?
The term has been used to describe many aspects of how a company is responding to new technologies and channel strategies. It is used to describe everything from a responsive mobile website to a newly formed social media strategy to a revamped IT approach.
In reality, digital transformation of a company must encompass much more than a single part of marketing or IT plan. It needs to involve all elements of the business to take advantage of what some have called the “digital transformation economy of the future”.
According to Forrester, only 27% of today’s businesses have a coherent digital strategy to perform as a true digital business. This number is predicted to double over the next five years, but companies must embrace the concept of a total corporate and business transformation now, in order to meet the changing consumer demand and the continued technological advances that will impact how we buy, sell and market products and services.
Here are some thoughts on how to begin this process.
Digital transformation will require integrating and consolidating all departments and functions of a corporation.
Marketing, sales and IT must come together to generate a single vision and strategy for how and why products and services will be offered and serviced to customers. All investments in IT and other functions must build on and contribute to this single-minded focus, that is based on optimizing the customer experience both pre and post sell.
Big data will be the foundation of creating an optimized customer experience.
Successful companies will find a way to harness and use the massive data that is available to develop new insights on how to personalize their products and services. As new data sources are discovered, digital transformation will require evaluation and adoption of new ways to meet customer needs based on these data streams.
The Internet of Things (IoT) and artificial intelligence (AI) will be catalysts for expanding digital interaction between companies and their customers.
Forecasters predict that by 2018, there will be more than 22 billion IoT devices impacting over 200,000 new apps and services. They also predict that we will see a shift in focus from gathering and mining data to creating new data streams to support customers in their buying decisions. By 2018, at least 20% of all workers will use “automated assistance technologies to make decisions, and robots will interact and supervise over 3 million workers worldwide.
Digital transformation will demand a culture change to work with new technology and create a business model change.
Simply adapting your current corporate structure will no t be enough. Companies and business leaders need to rethink how and why they go to market, and how to best integrate that structure to communicate and interact with customers. In a digital economy, a two-way communication with customers is required as customers control products, services, and interfaces. Shared communications will demand new business models for many companies, and will require they use social and other digital media to generate new insights on consumer needs and demands.
Digital transformation will be a continuous journey, not just tomorrow’s destination.
Consumer behavior is constantly changing as new technologies and systems create new products and service capabilities. Companies must recognize and accept that their long term strategic approach needs to be constantly evaluated and updated for long term success. And how that understanding will affect their business model and corporate structure will be the true challenge for digital transformation.
We must avoid one-off thinking and recognize that true transformation is a project that will never end. That thought can either frighten you, or motivate you. The choice is yours.
- Don Morgan
Don Morgan is Blog Editor and a past-president of PSAMA. He is Head Rainmaker at Raindance Consulting, a brand strategy and content marketing company. He can be reached at firstname.lastname@example.org/