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Business Digitization: What is the secret ingredient of success?

According to the observations, the companies that reached a significant level of digitization, possess the advanced capability to navigate and utilize six framework units:

  • strategic planning and cutting-edge advancement,
  • the decision-making process of a client
  • computerization of the process flows
  • management
  • technical knowledge
  • data analysis

Indeed, most of the companies can’t operate these six units equally and thus, focus more on one group while paying less attention and efforts to another depending on the business model specifics or temporary market requirements. However, the fact is all these framework units are highly helpful when designing and implementing digital systems into the operating model.

Strategic planning and cutting-edge advancement

In the process of designing a business strategy of the enterprise, the role of digital strategic planning is essential. More and more executives in charge of strategic drafting explore the benefits of digitization. The typical feature showing the difference between traditional and digital strategy is that the digital one refers to future anticipations, not to the analytics of past experiences and data.

The digital approach enables to forecast of changing value creation and assessment environment on the further steps of business development that are uniquely necessary to know the possibilities for a brand success or risks for its failure. And when identifying future opportunities and threats, it becomes possible to develop such a digital business strategy that will deliver maximum value to the customer.

Digitization makes an executive able to learn how the absolute value of the customers will look like in a defined period, for example, from three to five years, so this time can be used for developing the future model of value, not past or even present. At the same time, such a new digital model is useful for long-term business structure organizations, considering the changes and fluctuations of the environment, including choosing appropriate sales channels, consumers’ data processing approaches, and so on.

For instance, one chain of food supermarkets envisaged near separation of a group of ‘foodie’ customers who are ready to buy more sophisticated products under higher prices by collecting digital data of taste preferences of the customers in wine, cheese, and delicacy departments and thorough analysis of obtained intelligence.

In particular, the marketing department presented a series of encyclopedia articles in social media about history, sorts, regions of products such as Spanish wines or Swiss cheese, carefully collected the comments and wishes, written by readers, then classified and analyzed them.

As a result, the analysts find out the growing trend of new customers coming who are inclined to a more gourmet approach to buying food. Consequently, the company came up with a decision to establish a separate chain of elite food products stores under the same brand, and it increased the annual income significantly.

One more specific characteristic of digital planning is that the transition from strategy to real implementation becomes smooth. For instance, some executives draft new business direction strategies by trial product launch, which gives them much more understanding of whether this business plan will be successful or not instead of studying the subject just theoretically for months.

Case in point - the launch of a new series of devices for the analysis of pharmaceutical substances became possible half a year earlier than planned. A strategic digital development team proposed to start delivering the product to the market simultaneously with the announcement of an online warranty service. Also, they appointed virtual technical personnel whose task was to help the client in case of problems or the need for any assistance.

You might also be interested: Digitization - a Positive Trend for Business

Permanent online contact between a manufacturer and a customer compensated short-time in-house testing of the product.

Defining the strategic spot

As the companies have been practicing digital strategic planning for long enough time, the executives in charge of it can be divided into the groups due to the angle of approach and performance style:

  • Extractors are those who are capable of maximum efficiency for the existing business structure and to preserve it.
  • Niche-chasers systematize, optimize, and prepare for use the available resources and experiences to enter new market niches where the business perspectives have been detected.
  • Digital-backers concentrate the digital operational tools in their hands to intensify business activity in the existing segments and show the readiness to rebuild the business models of the company to implement more digital methods.
  • Digital pioneers use the digital tools to enter new segments and to model their business to make it more competitive in terms of basic parameters such as price, quality, or service.
  • Eco-value-makers utilize ecological care tools along with the digital approach to create the most balanced value.

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