Are you a Google, a Nike, or the next Toys "R" Us in the making? Here's how to compete in an increasingly digital business world.
In the age of disruption, making sure your company is digitally ready is no longer an option–it’s a necessity.
In fact, I’d argue that every company today is already a digital company by requirement–just some are (much) better at it than others. A local doctor’s office, for example, might still be using paper files and mailing appointment reminders–but most of their target market is living online. And even aside from the customer base, digital technologies can be used to improve internal efficiencies, streamline operations, and boost the bottom line.
So, from digitally native companies like Google to traditional businesses like your local doctor’s office (many of which are now using iPads to check you in for an appointment)–where does your company rank on the digital readiness scale?
If you find yourself at the very bottom of the scale, then digital transformation is a must.
But the unfortunate reality is many of the companies that attempt digital transformation, fail. And considering the latest news that Toys “R” Us is closing up for good, this notion couldn’t be more timely.
So, why do so many traditional companies struggle with digital? From personal experience, I can tell you it’s not from a lack of trying.
The problem typically starts when leadership invests too much time or energy in the wrong digital efforts. Some companies will invest in splashy tech like virtual reality instead of optimizing digital communication channels.
But these types of missteps can be avoided by measuring and contextualizing digital performance on a regular basis.
Measurement matters and context is king
To begin, your organization needs to know where your company ranks digitally–are you a Google or a Toys “R” Us?–and you can determine this by creating a baseline.
Your baseline should gauge the level of digital aptitude across your organization from people to platforms–and everything in between.
From there, you’ll need to add context around the data you’ve gathered. At the baseline level, you may have every reason to believe your marketing team is digitally savvy and sophisticated–but how do they stack up to the competition? And better yet, how do they stack up against the digital expansion efforts of a company like Amazon?
This is key–context doesn’t stop at your competition. If you don’t know how the digital space is evolving outside of your industry, you’ll never grow beyond your direct competitor. Instead, compare your baseline to other companies outside of your industry–even if they have nothing to do with your business. They might have game-changing best practices, tips, and ideas you can use to disrupt your own industry from the inside out.
Partnering with non-competitors
Succeeding in today’s business world is no longer about finding out what the competition is doing and beating them at their own game. It’s about coming up with new and innovative solutions before your competition can even think of a new idea.
And one of the best ways to do this is to analyze what your non-competitors are doing. You can leverage some great digital techniques, capabilities, and best practices that businesses outside your industry might following. Would the premise behind a dating app work to match your customers to products they might like? Or maybe you can use Facebook or Reddit’s gamification techniques to build customer loyalty.
This also opens the door to potential partnerships. Amazon, Berkshire Hathaway, and JPMorgan Chase is a prime example of this in action. These three companies from different industries decided to work together to create a digital solution to solve the issues surrounding healthcare. Each company has something to offer the other in a mutually beneficial relationship that will advance the future of healthcare–while the current players in that industry continue to struggle with digital transformation.
Consider which businesses you might be able to partner with outside of your own industry. You can enter into this partnership with the aim to share best practices or to create something new and fresh in the marketplace using your combined expertise.
To remain competitive and innovative, your business must stay aware of how it is benchmarking on the digital scale. But it’s not enough to know where you rank in your own industry and against your direct competitors. Leadership needs to have the right context on how they’re performing in digital across the board. If you don’t know, you’re leaving yourself open to disruption.