- Madeline Weiss, Director
CHECKLIST FOR IDENTIFYING DIGITAL TRANSFORMATION OPPORTUNITIES
Companies in most industries are reaping payoffs from leveraging digital technologies to create or modify products and services, enhance or develop business models, and improve processes. In some cases, opportunities become obvious to either staff in IT units or business units – or teams comprised of both. Identification might be opportunistic or through disciplined processes. Both approaches have merits and are worth pursuing.
Researchers* working with Advanced Practices Council (www.advancedpracticescouncil.org) members offered suggestions towards the disciplined process approach. We offer some of these suggestions in the form of a checklist for identifying digital transformation opportunities, along with examples.
I. Uncovering Digital Transformation Opportunities
A. How can we make our offerings (products, services) more intelligent?
Many companies use sensors such as click streams, mobile phones, wearables, cameras, and microphones to gather relevant data to improve their products. Insurance companies such as Progressive gather driver data in order to personalize customers’ insurance rates based on actual driving patterns. A Japanese hotel uses biometric data to expedite hotel guest check-in.
B. How can we use digital data to enhance and personalize offerings?
Stitch Fix algorithms gather and analyze customers’ style and ongoing preference data to refine the clothing and accessory selections sent to customers. Sephora encourages customers to experiment with products digitally, thereby enhancing sales. AmazonGo eliminates check-out lines for grocery shoppers. Customer service technology in some companies authenticates callers while humans actually speak with customers and solve their problems. Automated feedback at select pharmacies informs pharmacists of how they made their customers feel during telephone interactions with customers.
C. How can we transform our reach by expanding customer access?
Luxury Pavilion is a brand created by Alibaba to sell Chinese luxury products to customers who don’t want to associate with Alibaba for political reasons. Etsy connects independent craft sellers and buyers looking for unique goods.
II. Fleshing Out Potential Business Benefits
A. How can we be sure that the initiative will reap enough value to make the investment worthwhile?
Lean Canvas is a one-page template that helps evaluate the main elements of the business opportunity. It is adapted from the Business Model Canvas designed specifically for Lean Startups. The template is divided into 9 key sections: problem, existing alternatives, solution, key metrics, unique value proposition, high level concept, unfair advantage, channels, customer segments, early adopters, cost structures, revenue streams.
B. How can we best experience the payoff for the customer before executing?
Amazon creates press releases to describe initiatives as though they were completed products or services. Key elements included in each press release are:
· Heading – name of product or service in a way that the target customer would understand
· Sub-heading – target customer for product or service
· Summary – summary of product or service including benefits
· Problem – problem that the product or service solves
· Solution – how product or service solves the problem
· Quote – quote from spokesperson in your company
· How to get started – description of how easy it is to get started
· Customer quote – quote from a hypothetical customer that describes how they experienced the benefit
· Closing and call to action – describe what should happen next with this initiative.
*Dr. Didier Bonnet (IMD); Dr. Kristian Hammond (Northwestern University); Dr. Sam Ransbotham (Boston College)