Avoiding the Failure Chasm: Gaining The Most Value Possible From Digital Transformation

Whether you are a CEO, a CIO, a CTO, a CMO or the head of Customer Experience, Customer Service or Digital Transformation, you know software can be an amazing invention. It can be part of the key to digitally transforming your businesses in so many ways. In fact, here’s just a few of the ways digital transformations can take shape…

Digital Transformation and Software can help in the area of human capital by:

  • Increasing employee engagement, creating a passionate culture, increasing productivity and motivation
  • Attracting the top talent, making your organization the sought after place to work and an awesome culture to be envied
  • Reducing attrition of talent you want to keep to make sure you are able to produce the best possible business results.

Digital Transformation and software can help business generate revenue by:

  • Developing incremental innovation of products or services from receiving feedback from employees and customers
  • Co-creating new products with input from customers and employees
  • Developing new business models by creating new products and services that didn’t exist in the company’s line of business
  • Generating new applications and uses for existing technology, products & services, i.e., moving them from the core business and finding adjacent/new markets
  • Increasing the customer lifetime value, i.e., increasing the amount and frequency of purchases per customer over the lifetime of a customer
  • Increasing customer acquisition by increasing market awareness of the company, it’s products and services by engaging customers and brand ambassadors through delivering content at the top, the middle and the end of the funnel through two-way texting, email, digital ads, banners, digital and social media… and
  • Increasing the brand’s equity, reputation and preventing a PR crisis and brand intervention projects and so much more…

Digital Transformation and software can help business reduce costs by:

  • Creating new products and services with more agile processes (vs. waterfall processes)
  • Improving an exiting process or eliminating redundant processes / steps
  • Reducing the cost of products or services that fail in the marketplace because now they have feedback from customers and employees way before the product hits the market
  • Reducing the cost of bugs or flaws in the product or service because of using more agile processes and outcome-based thinking
  • Reduction in contact center costs by increasing first contact resolution (FCR) by using the most innovative ways to engage customers and
  • Reduce customer churn by increasing customer satisfaction by better customer experiences and hence increasing customer retention….

Why Do Company’s Fail At Digital Transformation?

So just from that short list it’s clear there are so many ways software can enable a business to function at it’s very best. However, there is something that can get in the way of the effectiveness and efficiency of the actual software’s ability to deliver on the promise. What might that be? If the software is good, then it’s not the software. So what is it? How can you realize your company’s vision through digital transformation when over 80% of digital transformations fail. Nobody wants to spend the time, the money and the effort getting a project approved, implementing it only to find a year or five later that it didn’t produce the results it was supposed to. But surprisingly, this still does happen. Some of those reasons include:

  • The absence of a clear plan to achieve digital transformation
  • Lack of alignment between business and IT
  • Legacy systems
  • Siloed data
  • Gaps in talent and skills
  • Cultural resistance to change and
  • Group think (seeing the problem from the same perspective.)

How Smart Companies Are Avoiding the Digital Transformation Failure Chasm

Smart leaders need all the efforts of all their employees, as well as, feedback from their customers so they don’t fall into the digital transformation failure chasm. However, often times they are so busy doing what they have always done, they they might not see a new way of looking at things. That’s where another pair of eyes or hands or even a team can help. You’ve experienced this probably yourself. You are trying to solve something. You feel you’ve looked at it hundred different ways and nothing really new comes about. You might even show a friend or a team mate and they are stuck, too. Why does this happen? You are not alone. In fact, it’s quite common.

1962, Abraham Kaplan, then a Professor of Philosophy, was giving a speech to scientists in which he urged scientists to carefully consider their methods for their research. He emphasized that – just because certain methods happen to be handy, or one has been trained to use a specific method or trained to look at a problem from a certain perspective -it doesn’t mean that that method will produce the best outcomes. Sometimes people formulate problems that reach solutions by using those techniques they are especially skilled in. In other words, we tend to formulate our problems in ways that make it seem the solutions to those problems demand precisely what we already happen to have at hand. In Abraham Maslow’s The Psychology of Science, published in 1966,  stated, “If all you have is a hammer, everything looks like a nail.” The issue is the reliance or over-reliance on the familiar or the habit of using the same perspective.

Taking this concept into software development and implementation, José M. Gilgado, wrote a law  that is still relevant and highly applicable in 21st century. He observed, often times software developers and implementors, “tend to use the same known tools to do a completely new and different project with new constraints.” Why? They blamed it on what he calls the comfort zone, a state where we don’t want to change anything to avoid risk. What’s the problem with using the same tools every time? We get good at those tools and we like using what we are good at, right? The issue can become that you don’t have enough diversity when discussing the problem (because you are using the same perspective you’ve always used) so the exchange of diverging or opposite views is limited and the choices to look at the problem from different points of view are limited because there’s nothing new to compare it to. What would be better if is… to look for the best possible choice with varying perspectives, even if we aren’t very familiar with them. But we rarely do that. Rather, we fall into group-think.

There’s some very interesting research by a professor at the University of Michigan, Scott E. Page who studies complexity theory. In his book, The Difference, he shows how the power of diversity creates better groups, firms and business outcomes. We all differ in how we see and interpret the world. How we code things is our “perspective.”  Scholars from a variety of disciplines have studied how people and groups make breakthroughs. The bottom-line? Encouraging and working with diverse perspectives. For example, do you know how pins came to be manufactured? Adam Smith ran one of the first brush factories. Someone saw that the bristles could be cut off and made into pins. That’s what I mean about seeing things differently. Most people would have looked at a brush factory and saw a brush factory. But the first pin factory was imagined by seeing that diverse perspective – seeing the world differently – seeing the world as a forest of pins – provided the seeds of innovation.

What does your team need? You’ll want to engage and partner with a new set of diverse senior advisors and specialists who are dedicated to your success, who use unrivaled expertise, processes and methods to make your business more agile. You’ll want to make sure they are the kind of people who thrive on guiding your team so your team learns the key principles to create and sustain change. And you’ll want to choose the most powerful technology platform to be the basis to fuel your transformation for today and far into the future. With all of that, and a collaborative team culture you can:

  • Align key leaders around a digital transformation strategy
  • Implement the right framework to move forward
  • Create the agility needed in today’s digital environment and
  • Adopt new technologies faster to keep pace with change.

Often it is –outside, diverse points of view– that are just what is required to steer you clear of the failure chasm, and instead have an immersive engagement based on a proven approach that combines people, expertise, culture, and technology. You want to be working with people who are uniquely able to help a business realize their visions and co-create the future by:

  • Exploring the art of the possible by
    • Leading with out-comes based thinking (OBT begins with defining a desired outcome, no matter how bold or provocative. It’s fundamentally different from problem solving, which looks at the current state and attempts to improve it)
    • Inspiring design-led thinking (instead of solving a problem, your team becomes solution-focused and action-oriented towards creating a preferred future)
    • Testing new strategies (vs. setting a plan and sticking to it for a year and then realizing they’ve wasted a year or more on something that isn’t going to work; maybe even trying a little experimentation to see if something could even work)
    • Sparking agility throughout the organization, igniting the whole culture’s motivation in whole new ways, giving them a renewed sense of purpose and outlook on the future and feeling they have the dream job and a reason for showing up other than a paycheck!
  • Building your digital capabilities by
    • Improving your operating model (and maybe even shifting the revenue model to something you’ve never considered, but it was the innovation that was needed to grow the company exponentially)
    • Growing the competitive advantage; as the Blue Ocean Author’s would say, you’ll want to create new, uncontested market spaces making the competition irrelevant
    • Stimulating breakthrough ideas that transform business as usual and
  • Creating sustainable transformation by
    • Creating a customer-first culture
    • Managing complex changes and
    • Continuing the processes required to innovate, iterate, pivot and grow.

How do you find such a group? Look at their DNA. Is it digital? Are they a natively global, mobile, social, cloud, community-oriented company? Are they trusted advisors who put the customer first and teach them to fish? Do they experiment, try new things, iterate and pivot quickly when it doesn’t work and tweak things till they hum? Do other companies desire to be like them and wonder what technology they use to be so innovative and wonder how is it, they do what they do? Are they super customer focused? As my friend and colleague, Peter Coffee would say, “Do they create a sense of urgency, hope and glory? Or conviction, belief and desire in your team? Are they all about (and seriously about this, it’s not just some words on a website or a brochure) connection, collaboration and innovation?” If you want to learn more about how one group guides business through digital transformation, here’s more info on that!

Until next time, here’s to realizing your vision and the best possible future for your company, your employees, your stakeholders and the planet. It’s all of our jobs to make the world a better place. And what better place to do that than starting with businesses? That’s where people spend a great deal of their time! So make it a fabulous experience for employees and the customers will feel the love. You will be their go to source for all your customer’s products and services. Don’t give them reasons to leave you, Give them reasons they can’t possibly give you up. Because… at the end of the day, that is what drives customer lifetime value. No customers, no business. It’s really that simple.

@DrNatalie Petouhoff

VP, Program Executive, Innovation and Transformation Center, Salesforce.com

Share

What’s the Number One Number Thing Today’s CEO’s Must Do? Do the OODA Loop Faster and More Innovatively

What’s the Newest Requirement for a CEO? Do the OODA Loop Faster and Better!

You would think it would to generate revenue, profits and reduce costs. Think again. It’s all about iterating and pivoting like a start-up. And who better than a former fighter pilot to teach CEO’s a thing or two about making quick. So I want you to meet John Boyd, who was among many things, a military strategist, colonel and fighter pilot whose theories are highly influential in the military, sports and business.

So why bring up Colonel Boyd in the context of CEO’s and their need to be nimble? Because investors and boards have transitioned from desiring quarterly profits (something that has driven Wall Street and corporations for many years) to searching for leaders to those who have the ability to disrupt their industry or die. What did the fighter pilot, Colonel Boyd used to make those decisions to do something out of the ordinary? He created a framework known as the OODA Loop:

  • Observe (M—ake the best use of the information and other intelligence resources available right now)
  • Orient (Quickly put the new observations into a context with the old)
  • Decide (Make quick decisions and take the “next actions” based on a combination of observations, current knowledge and intuition), and then
  • Act on those decisions to carry out the selected action(s), ideally— while the competitor is still observing your last action so you beat them to the punch!

OODA Loop

                                         Photo Source: Larry Paul

Above is a video from Ralph Mroz on the OODA Loop as applied to business if you want more information!

Observe, Orient, Decide and Act Is Known as John Boyd’s OODA Loop

As a fighter pilot, John had to make decisions in nano-seconds. With this framework of observe, orient, decide and act he way able to describe a way to iterate and pivot, very quickly, and decide if the object in front of them is friend or foe. Not doing so could mean life or death. It could also mean the end to a critical mission.  What does the OODA Loop mean to a CEO? Iterating and pivoting is also mission critical. Just ask the CEO of Ford Motor Company, Chief Executive Mark Fields. He was a 28 year old veteran of the business and was replaced by someone the business thought would be able to disrupt the automotive industry very quickly!

The Message is Simple: Do the OODA Loop Faster or Die

While Mr. Field’s did what most board’s used to expect of a CEO’s, i.e., he returned consistent profits, he did’t make enough changes fast enough. His OODA loop was too slow. But he didn’t know what he didn’t know. He, as many other CEO’s don’t realize that the winds of change are changing all around us. Like in most any industry, the car market has entered into the era of transportation.

It’s no longer just about building and selling a car. It’s about car-as-a-service. Think: ride-sharing (think Lyft, Tesla and ReachNow (by BMW.) It’s also about taking the traditional gasoline engine and transforming it’s power source to be an electric vehicle. And it doesn’t stop there. Some companies are disrupting the industry by experimenting with self-driving technology, making investments in connected cities (think BMW and Santa Monica, CA.) And at the same time Ford’s stock sank. 

How Fast Does Your CEO do The OODA Loop?

How fast do decisions get made? How fast can the ship be turned? Today, with the need to act quickly, the message is simple. We are in an age of rapid disruption by the software and tech industries. A leader of any company has to pick up the tempo and make riskier bets sooner… or die. While it was Mr. Field’s intention to set Ford on a path to be part of the new, emerging auto industry, he just didn’t do it fast enough.

Since Mr. Field’s took over three years ago, the share price of Ford is down 40%. As a CEO, as yourself, “Are you disrupting yourself, your company and your products fast enough? Are you really changing anything or are you just doing the old stuff just faster?” These are not easy questions, but ones that we all need to contend with. Consider you are one company and your are disrupting yourself faster than your competitor. What happens to the competitor?

ooda loop faster to drive innovation @drnatalie

                                                             Photo Source: Larry Paul

As a CEO, Are You On Track?

In military operations, OODA loops takes place in nano-seconds. In corporations, its decisions are often slower. In the old days, strategy was rigidly followed till next years’ planning cycle. But today, that’s no longer an acceptable mindset. And it’s critical to validate we’re on track and if not, correct it. Using a model like the OODA Loop, along with design-thinking which requires to you go and talk to your customers, your employees, customer’s of your competitors, to industries that are similar to your and industries that have nothing to do with yours.

It’s where the kernel of the seeds of innovation are hatched, born and grown into a full idea. The results of your actions become the observations to re-orient you to make your next decision. Quickly repeating the OODA loop equals success. And as you are doing this, you want to make sure you are making real-time changes that are just changes to make changes, but change to create a “Blue Ocean Strategy.” As defined by the author’s of the book, Blue Ocean Strategy, CEO’s need to quickly create an uncontested marketplace, where the competition is irrelevant.

Who’s Slow to the OODA Loop?

According to the article by Christopher Mims of the Wall Street JournalRonald Boire of Barnes & Noble, GNC Holdings’ Mike Archbold and top executives at three of the six major Hollywood studios making changes faster is very important. Where to look for inspiration? According to Mr. Mims, unlike large corporations, startups don’t need decades to make the changes the businesses need to succeed in the new world. They are nimble, they are always iterating, pivoting, changing, trying new things, not being afraid of conflict…

What does this mean for established companies? They will need to take drastic measures to do the OODA loop faster. What kind of drastic measures? According to the article, these CEO’s must be willing to tell their stakeholders they may have to lose money and cannibalize existing products and services, while scaling up new technologies and methods. Not the same old dog chow most CEO’s having been dishing out.

How Can a CEO Get On Track?

It used to be that you could acquire the start-up that was trying to put you out of business. But in today’s market it takes more than that. Companies that are disrupting the marketplace are growing so quickly, capturing so much market share, they don’t want or need to be acquired. And they can become too valuable to buy or are unwilling to sell. So the questions for you, as a CEO, “Is do you have systems to monitor/measure what employees know, think & feel about what is going on in the business?”

They are often the ones on the front line that really know what is going on and what needs to be done, or at least what isn’t working. “Do you really know what your customers know, think & feel? Or do you have a cordial relationship where the “real deal” is not really discussed?” Honest, conscious conversation is where it all starts. Many people have made careers by learning how to manage-up well. That’s not a bad thing, except when you aren’t telling the CEO the truth about what the troops think, feel and know. But there has to be a cultural environment that always you to be able to safely say the things. That’s not always the case.

And, as a CEO, “Do you take that information that you have gathered from your employees, your customers, all kinds of sources and integrate it into your company?” One of the best ways to stay on top of the game is to monitor social and digital media. If you have a digital / social media command center, where all the top news and information is brought into one central place, you can begin to digest a new picture of the quickly changing landscape very easily. You’ll also want to keep your ear closely attuned to what is happening in the start-up world, regardless of whether it is Silicon Valley or Silicon Beach or Silicon Edge or…

The More Things Change, The More They Stay The Same

To me, all of this sounds like something very familiar to those of us who came from the voice of the customer or quality. Remember Deming, the father of Quality who was pushed out of the American Auto Industry? And then only to be invited to Japan and make their automative industry soar? What was his secret sauce? To listen to their customers and the employees. To make really changes to their products and services based on that feedback!

Start Incubating Innovation

Today, companies must incubate disruptive ideas within their own corporate cultures. And this is not easy, because often it means supporting them as they grow into something truly disruptive. The company might have to absorb their losses. For example, for its first 20 years Amazon made almost no profit. But iterating, pivoting and incubating is not enough. A CEO must maintain the existing business at the same time as they innovate. This is a new and rare skill.

So where best to learn how to think like an OODA Loop CEO? Find a group that help take you through thinking differently, through a design-thinking process where you never know what will come out of it, but it always spurs innovation. You have to cross the chasm, from how you normally do things, to how things have never been done before. That’s a lot of change, so it’s also important to develop those ideas and new innovations in the culture where change and honestly is accepted and appreciated.

@drnatalie

VP, Program Executive, in the Innovation and Transformation Center 
Share

Innovation & Disruption In Delivery: Could Your Next Amazon Delivery Be By a Drone?

Ever Had a Package Delivered Late, Not at All Or To the Wrong Address?

One of the most irritating issues with ordering online is whether the package gets delivered and to the right address and on time. I know I’ve experienced this a number of times and what’s interesting is that, as customer’s we don’t always think about the delivery service as the issue, but rather it reflects poorly on the company we by the product from. How to fix this customer experience issue? One option is to deliver packages to consumers’ homes using drones. Could this allow companies to bypass the challenges with that last step of the delivery? It might be for delivery to people’s homes. It might not work at apartments, though, because the drone can’t get into the apartment building. Or can it?

What customers may not know is that the last leg of the delivery is the most expensive and inefficient part of parcel delivery. Customers don’t often think about that the product has to go from a store or warehouse, to the shipper’s delivery center and then from there, be deployed to the customer’s address. It is often not the place you bought the product from that is having the issue. It maybe who their delivery service or services are. It could be the individual who works for the delivery service. I know I personally had package delivered to an address that was similar to mine, but not mine. The individual was new to the delivery route and got mixed up. I had to run after the delivery truck, stop them and tell them they delivered to the wrong building. (I had gotten a text my package was delivered, but it was not on my doorstep or at the post office boxes for my building.) And since this happened more than once, I knew what had happened.

What’s the Solution To Better Customer Experience Delivery?

E-commerce companies, like Amazon, are using drones to speed up the this last part of the delivery process, while cutting costs. The result? Improving the customer experience, customer satisfaction and loyalty. And what’s interesting is even legacy retailers could take advantage of a similar process to grow online sales.

So What’s the Hold Up?

While there are many obstacles to overcome for instance, drone regulations, the development of autonomous flight and traffic control systems for drones, as well as consumer acceptance, there are companies actively trying to figure this all out. For instance, Amazon is working on drone delivery, depending on when and where they have the regulatory support needed to safely delivery packages. They want to use drones to deliver packages to customers around the world in 30 minutes or less. In fact, they have Prime Air development centers in the United States, the United Kingdom, Austria, France and Israel.

Amazon Prime @drnatalie

Photo Source: Amazon

They believe the airspace is safest when small drones are separated from most manned aircraft traffic, and where airspace access is determined by capabilities. To learn more, you can look at Amazon’s airspace proposals here: Best-Served Model for Small Unmanned Aircraft Systems and Revising the Airspace Model for the Safe Integration of Small Unmanned Aircraft Systems.

Disruption to Delivery Logistic Firms

As e-commerce providers like Amazon look for solutions within their own company, many logistics providers are experimenting with drone delivery. These firms also seek to cut costs as well as ward off competition, whether it’s from startups, technology companies or e-commerce companies. In fact, FedEx is betting on automation to Fend off contenders like Uber and Amazon. The shipping giant is investing in autonomous trucks and is interested in delivery robots, drones and an Alexa app. And while there are attempts to get this right, those of us in the innovation space know that #failfast – iterating and pivoting is the key. In my book, it’s ok to fail. You can’t learn what you don’t know, you don’t know unless you try. Trying means you learn something each time. Though the concept of failfast is very popular today, if we look back at Edison, it took him 9,999 times to get the filament for the lightbulb to work on the 10,000th time. What if he gave up? We’d all be in the dark!

How Is Amazon’s Prime Air Trial Drone Deliver Program Progressing?

Amazon have started with a private customer trial, to gather data to continue improve the safety and reliability of their systems and operations. As they gather data, this will bring them closer to realizing this how to use this innovation for all their customers. Does weather affect the delivery? Currently, Amazon is permitted to operate during daylight hours when there are low winds and good visibility. However, they are not using it when it rains, snows or in icy conditions. They feel they need to gather more data to improve the safety and reliability of their systems and operations to expand the offering. They are working with regulators and policymakers in various countries in order to make Prime Air a reality for customers around the world.

Video Source: Amazon

Where Can you Find more Information On the Disruption and Innovation Drone Delivery Can Provide?

In a new report, BI Intelligence examines the benefits drone delivery can provide as an e-commerce fulfillment method. In the report, they look at the different approaches companies are taking to experiment with the new technology and processes involved in this new delivery process. In addition, they look at the key players working in the drone delivery space. And have researched the challenges drone delivery faces in reaching mainstream adoption.

Will Your Industry Be Disrupted? Every Industry Should Be Thinking It Will Be Disrupted!

As I was giving a talk on disruption and innovation, I had many questions from what would be considered very standard legacy firms. What they need to be careful of is being aware of the fact that somewhere, in someone’s basement or garage, someone is probably working on a project that will disruption their industry. It’s customary to do the ostrich: stick you head in the sand. But doing so will only make you a dinosaur, (extinct) if you are not careful.

Disruption and innovation are all around us. Just look at what happened to the taxi industry. Not only did Lyft and Uber transform how customers’ order, receive and pay for rides, but they disrupted an age old industry that had not changed for years. And take GM for instance. They make cars. But they decided to look at cars as a service and invest $500M in Lyft to be part of the cars-as-a-service industry.

Disrupt Yourself or Die

Instead of being one of those industries or companies that waits until an upstart disrupts their revenue model and takes marketshare, why not start innovating within your own company. Too many companies are complacent or don’t have the skills to think outside the box. If you don’t, it may want to seek out a firm that can you help you think through this new and confusing new frontier of design-thinking, innovation and disrupting yourself — as a company and as a person. No one wants to be the company that had the leg up on IBM and caused it’s own demise: i.e, nobody wants their story to go down like Digital Equipment Corporation: DEC.

“Digital Equipment Corporation achieved sales of over $14 billion, reached the Fortune 50, and was second only to IBM as a computer manufacturer. Though responsible for the invention of speech recognition, the minicomputer, and local area networking, DEC ultimately failed as a business and was sold to Compaq Corporation in 1998. The  fascinating modern Greek tragedy in book form by Ed Schein, a high-level consultant to DEC for 40 years, shows how DEC’s unique corporate culture contributed both to its early successes and later to an organizational rigidity that caused its ultimate downfall.” Don’t do a DEC.

@drnatalie

Natalie Petouhoff

VP, Program Executive, Innovation and Transformation Center | Salesforce.com

 

Share

Vending Machine Are Not Just for Chips and Soda: An Innovation for Displaying Luxury Cars?

If you thought vending machines were just for fast food, think again. They are now for fast cars. From a Singapore “vending machine” you can order Bentleys, Ferraris and Lamborghini’s.

Who thought of this innovation? None other than the used car seller Autobahn Motors. They wanted to make efficient use of space in land-scarce Singapore and stand out from competitors. So in December, they opened a 15-story showroom, with 60 slots for vehicles, calling it the “world’s largest luxury car vending machine.”

How does it work? Well if you are in the market for a super fancy car, you can stand on the ground floor and with a touchscreen choose the car of your dreams. With an advanced system that manages vehicle retrieval, the car arrives within one to two minutes.

Gary Hong, general manager at Autobahn Motors, said,  “We needed to meet our requirement of storing a lot of cars. At the same time, we wanted to be creative and innovative,” he told Reuters. He has been approached by developers interested in using the company’s Automotive Inventory Management System for parking services.

But they aren’t the only ones. In fact, U.S. company Carvana uses vending machine-like towers to sell used cars. March marks the month it opened an eight-floor structure holding up to 30 cars. The Carvana vending machine, is a coin-operated. The proprietary Car Vending Machine offers a unique pick-up experience for customers who purchase a car online through the company.

How does it work? Carvana customers search for and then buy their car online at Carvana.com using — you guessed it – a mobile phone or desktop computer. Not only can customers buy the car, but they can also choose the vehicle financing through Carvana and even have the option to trade-in a car.

Once the purchase is complete, customers can choose to have their car delivered directly to their door or they can elect to pick it up at one of Carvana’s Car Vending Machines. If they choose to come to the vending machine, at the time of pick-up, the customer receives an oversized Carvana coin to drop into the custom coin slot at the at the car Vending Machine. The purchased car is automatically retrieved from the tower and moved through the machine until it reaches a delivery bay. There, the customer gets to drive away!

Where will the next source of innovation come from? You never know these days!

@drnatalie

Read the original article on Reuters. Copyright 2017.

 

Share

Digital Transformation Projects Have an 84% Chance of Failure; Are You Ready to Failure or Succeed?

Would You Invest If You Knew the Investment Had a High Likelihood of Failure?

If I were to tell you that I had an investment opportunity for you and the probability of you making money was 16% or less, how likely would you be to invest in it? But if I told you that the investment opportunity had a 90% chance of returning your investment, might you be more likely to want to invest?

What’s interesting is that digital transformation is all around us. We can’t help but be impacted in our person lives, from smart phones, smart TVs, apps (think taxi’s vs. Lyft), Siri, Alexa and Google Home. In business, it’s clear that customers want to engage with business in digital and mobile channels. Businesses need to make the transition to be competitive and survive. Yet according to Consultancy.uk* and Bruce Rogers** who wrote Profitable Brilliance: How Professional Service Firms Become Thought Leaders, 84% of businesses undergoing digital transformation are likely to fail. 

The More Things Change, The More They Stay The Same

Having been at this game for a while, the statistics reminded me of stats from nearly 20 years ago when the topic was CRM and ERP. Though they are not exactly the same, they have many of the same elements. Digital transformation, innovation and CRM and ERP implementations are IT implementation of people, process and technology. What they have in common is the use of technology to make scalable processes that were once manual. The advantages among many, were higher productivity (cost savings) but also providing better customer-facing experiences (revenue generating.) Going back through my old papers about CRM and ERP failure rates,*** I saw many of the same type of stats predicting similar failure rates for digital transformation projects are being predicted today**** (and by many prominent groups, including IDC, Gartner Group and Forrester Research.)

Things that make you go hmmmm. The more things change, the more they stay the same.

When Will Organizational Change Management and Culture Change Be Taken Seriously?

The stats show since the late 1990’s – early 2000’s until now, when Culture Change (CC), Organizational Change Management (OCM) and Behavioral Change (BC) is missing from a project, there are issues, yet it’s still not “fashionable.” Perhaps the lack of fashionability is from an old paradigm stemming from the command and control type leadership that doesn’t deem people as an important aspect of the business transformation, whether its CRM, ERP or Digital Transformation. Perhaps it stems from leadership that doesn’t know there’s a whole science and set of CC and OCM methodologies that go along with IT implementations. Perhaps they have never been shown the value of that OCM and CC can bring, so they still don’t think it’s important enough to invest in. Perhaps it’s a matter of showing people that it works and makes a difference!

The Time for Change is Now

The 4th industrial revolution challenges most of our existing mental models. What this means is that cultural change is essential to enable and execute successfully, any business / organizational / digital transformation. The key is having a plan, as well as, having developed tools and process for culture change and organizational change management which includes, but is not limited to having a:

  1. Communication plan and regular communication cadence
  2. Leadership and stakeholder involvement and engagement
  3. Training and skill development for the future state of the business and
  4. Organizational readiness and adoption on a continuing basis of the ongoing changes.

And of course, underneath each of these very simplistic groupings is a deep set of assumptions, tools, methodology and business-driven outcomes. So digital transformation isn’t uniquely about technology. It is about having the right digital strategy to ultimately transform a business to achieve higher objectives. This type of digital transformation must be built along with the human capital component, including skill sets, as well as, a cultural adoption of changing the way we do business. So what it boils down to is evolving behaviors within the organization, both from a leadership point of view as well as middle level managers to all employees.

Being Stuck in the OCM Adoption Chasm Will Cause Digital Transformation Failure

What is seems like, referencing one of my favorite people and author’s is Geoffrey Moore. It’s seems that perhaps we are, after twenty or more years of having OCM and CC at our finger tips, we are stuck in the adoption chasm. What we are headed for is the digital transformation iceberg of failure. We know what the iceberg did to the Titanic. We don’t want to be on a sinking ship. So what does an organization need to do? More on all of this in a future post.

@drnatalie

Natalie Petouhoff

VP, Program Executive, ITC | Salesforce.com

References

* Consultancy.uk. “Two Thirds of Digital Transformation Projects Fail” Consultancy.UK. N.p., 28 Sept. 2015. Web. 28 July 2016

**Rogers, Bruce. “Why 84% Of Companies Fail At Digital Transformation.” Forbes. Forbes Magazine, 7 Jan. 2016. Web

*** http://sloanreview.mit.edu/article/the-end-of-corporate-culture-as-we-know-it/

*** http://www.cio.com/article/2440386/supply-chain-management/supply-chain—hershey-s-bittersweet-lesson.html

*** http://customerthink.com/failed_crm_implementation_finally_costs_hp_465_million_in_damages/

*** http://www.destinationcrm.com/Articles/Columns-Departments/The-Tipping-Point/The-Scientific-Reason-for-CRM-Failure-Part-1-42510.aspx

*** http://www.destinationcrm.com/Articles/Columns-Departments/The-Tipping-Point/The-Scientific-Reason-for-CRM-Failure-Part-2-42655.asp

*** http://media.techtarget.com/searchCRM/downloads/CRMUnpluggedch2.pdf

*** http://www.zdnet.com/article/crm-failure-rates-2001-2009/

*** https://hbr.org/2002/02/avoid-the-four-perils-of-crm

*** http://www.infoworld.com/article/2648303/applications/waste-management-sues-sap-over-erp-implementation.html

*** http://www.computerworld.com/article/2517917/enterprise-applications/sap–waste-management-settle-lawsuit.html

*** https://www.google.com/#q=hershey+crm+failure&*

*** http://www.crmsearch.com/crm-failures.php

*** http://www.destinationcrm.com/Articles/Columns-Departments/Insight/A-Succession-of-Failures-70822.aspx

**** https://www.idc.com/getdoc.jsp?containerId=US40550115 ; http://www.gartner.com/newsroom/id/3337617 ; https://www.cmo.com.au/article/545992/will_your_business_digital_predator_prey_/

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Share

Video Advertising: Key to Getting Customers Attention As Ad Blocking is Increasing

Searches for Influencer Marketing have grown 5x in 2015 according to a study from Google Trends from January 2016. Nearly 40% of Millennials are using ad block applications and their use is growing fast according to a study by PageFair & Adobe. So how does a company get their target customer’s attention? And with content marketing a #1 priority for most CMOs as more and more sales are decided upon before even talking to a sales person. And sometimes a salesperson is never contacted, so getting the customer’s undivided attention has never been so important. Perhaps the answer is video marketing. Video consumption has exploded across all devices and is one of the fastest growing advertising category.

Adobe, a the leader in video content creation and delivery, announced it’s acquisition of TubeMogul which will enable brands to capitalize on the huge shift to online video. The acquisition of TubeMogul  strengthens Adobe’s leadership in digital marketing and advertising technology. The addition of TubeMogul will enable Adobe’s customers to maximize their video advertising investments across desktop, mobile, streaming devices and TV. TubeMogul’s video advertising platform. In addition, this allows their customers to build upon their capabilities in search, display and social advertising planning and delivery using Adobe Media Optimizer with Adobe Marketing Cloud. This combination will give customers access to first-party data and measurement capabilities from Adobe Audience Manager (Adobe’s data management platform) and by using Adobe Analytics.

Why is video advertising so important? Brad Rencher, executive vice president and general manager, digital marketing, Adobe gave this statement, “Whether it’s episodic TV, indie films or Hollywood blockbusters, video consumption is exploding across every device and brands are following those eyeballs.” Adobe feels the acquisition of TubeMogul, will give customers a ‘one-stop shop’ for video advertising, providing even more strategic value for the use of the Adobe Marketing Cloud.

TubeMogul is a video demand-side platform (DSP) leader. Brett Wilson, CEO and co-founder, TubeMogul said, “The combination of Adobe Marketing Cloud with TubeMogul’s software creates a uniquely comprehensive platform that will help marketers always know what’s working — and act on it.” And what’s key is measurement – to know what is working and not working, and obviously do more of what is getting a result.

There are so many choices for Marketers today, as far as software and it is only getting more confusing with all the choices. When a software company can show you how to get results, you know you are going in the right direction. Education and learning to use all the features and functions of what the various software platforms provide is of growing concern for most companies to obtain the highest ROI possible for the investment they have made.

It’s key that Marketers are clear on what their strategy, goals, objectives and tactics are and have a strong measurement program to be able to show that the software purchase enhanced the brands ability to drive more awareness, increase customer acquisition and turn more leads into sales. And with ad blocking increasing, there’s got to be another way to get customer’s attention. Video seems to be a prime candidate. This is just one example of how early adopters and innovators are taking hold of the market place and making their competition irrelevant. And like the BlueOcean authors said, that’s the key to financial success in today’s marketplace. Cross the chasm, join the digital transformation and digital disruption evolution or expect to be disrupted. Disrupt or be disrupted. Those are the choices to being innovative leaders and using design thinking to transform your business revenue model.

@DrNatalie, VP and Principal Analyst, www.ConstellationResearch.com

Covering Customer-facing Applications to Create Great Customer Experiences

Share

Constellation ShortList™ for Customer Experience (CX) Services: Global

The Customer Experience (CX) Services Global List acknowledges leaders in driving customer experience excellence in organizations. The Constellation ShortList presents vendors in different categories of the market relevant to early adopters. In addition, products included in this document meet the threshold criteria for this category as determined by Constellation Research.

This Constellation ShortList of vendors for a market category is compiled through conversations with early adopter clients, independent analysis, and briefings with vendors and partners. A systems integrator (SI) or customer experience (CX) service provider brings together solutions into an overall customer experience hub. They work with all functional departments, such as marketing, sales, customer service, supply chain, e-commerce, IT, digital performance management (DPM) and back-office systems.

With SaaS solutions, the SI’s role is changing to focus on strategy, tactics and choosing technology. Customer experience SIs guide brands’ CX journeys on all channels (e.g., email, chat, text, websites, phone, social networks) and devices (e.g., phones, tablets, desktops), and optimize each to make the experience flawless. With options to order on a website and pick up in a store or ship to an address, front-end experiences need to be great, along with top-notch supply chain/ERP so inventory is current. In addition to customer journey mapping and choosing omni-channel technology, they focus on DPM to ensure websites load quickly and shopping carts don’t get hung up or abandoned, while mitigating lost revenue.

CX SIs have a set of best practices, strategy design, optimal delivery, and testing methodology to guide clients to obtain an optimal CX from a customer’s point-of-view. These firms often perform a gap analysis (comparing the current and future state of the customer experience to find gaps). SIs use gaps to create a long- and short-term road map, emphasizing low-hanging fruit and large ROI. SIs often incorporate organizational change management.

Constellation considers the following criteria for these solutions:

  • Best practices methodology
  • An assessment tool
  • Create strategy and technology roadmap
  • Customer references
  • Differentiated IP
  • Customer success management
  • Operating in three continents.

Constellation evaluates over 100 solutions categorized in this market. This Constellation ShortList is determined by client inquiries, partner conversations, customer references, vendor selection projects, market share, and internal research. Enterprise Service Providers / System Integrators / Management Consultants include:

  • Accenture
  • Bain
  • Boston Consulting Group
  • Capgemini
  • Deloitte
  • Ernst & Young
  • IBM Global Business Services
  • Infosys
  • McKinsey
  • SapientNitro
  • Wipro.

For more information about this short list, please see the Constellation Research website.

@DrNatalie Petouhoff, VP and Principal Analyst, Covering Customer-facing Applications

Share

Constellation ShortList™ for Digital Performance Management

Digital Performance Management provides companies with the analytics to determine if their customer experience is optimized. The Constellation ShortList presents vendors in different categories of the market relevant to early adopters. In addition, products included in this document meet the threshold criteria for this category as determined by Constellation Research. This Constellation ShortList of vendors for a market category is compiled through conversations with early adopter clients, independent analysis, and briefings with vendors and partners.

Mastering digital performance management (DPM) is one of the leading challenges of the digital economy. Often referred to as application performance management (APM), it requires a joint effort between many functional departments, such as marketing, sales, customer service, e-commerce and IT. It is no longer just about IT looking at the performance of the technology stack or the management of the infrastructure or cloud that delivers customer experience.

Today, it’s about the collaboration between the lines of business and IT to measure and manage the end-to-end transaction delivery and translate it into actionable information that a brand can use to optimize customer experience, as well as the performance of the technologies used to deliver it. When DPM is optimized, companies can deliver an engaging digital experience, maximize revenue and improve brand loyalty. DPM vendors help both the business and engineering teams to not only define conversion and revenue goals but also make sure they are reached.

They make sure the application’s performance doesn’t become a roadblock to optimal customer experiences and reaching business metrics, including conversion rates, high availability and high user experience indexes. The goal is to monitor and measure to eliminate all revenue barriers with a strong focus on digital performance to ensure that the road to conversion is quick and easy; the customer experience is smooth; and customers remain loyal as a result.

Constellation considers the following criteria for these solutions:

  • Monitoring of each customer’s journey and business transactions, using intelligent analytics
  • Proactive application monitoring for quick problem resolution and maximum availability
  • Full insights into each customer’s journey to make better business decisions
  • Connect the dots between customer experience, application performance and business outcomes
  • Full technology stack monitoring with deep operational insights into the user’s application environment
  • Big data monitoring and data visualization
  • Mobile application monitoring
  • Cloud, server and mainframe monitoring
  • Load testing, virtualization and network monitoring
  • Customer behavior analytics.

Constellation evaluates over 25 solutions categorized in this market. This Constellation ShortList is determined by client inquiries, partner conversations, customer references, vendor selection projects, market share and internal research. These are the best-of-breed vendors that provide applications and services without bundling into another platform:

  • APM+
  • AppDynamics
  • Dynatrace
  • NeoSense
  • Oracle
  • SAP
  • SOASTA.

For more information, please see the Constellation Research website.

@DrNatalie Petouhoff, VP and Principal Analyst, Constellation Research, Covering Customer Facing Applications

Share

The Business Phone System Reinvented: The Next-Generation Cloud Communications and Collaboration Tool

The only way to build a truly innovative and collaborative culture is to give everyone a voice. In working with Dialed, I just completed some ROI research to understand how quickly, easy and affordable it is today to plug every employee into your business with a very innovative phone system. They way it works is that Dialpad turns all of your devices into your business phone, letting you make high-definition calls over Wi-Fi or your carrier network from anywhere. And businesses can let their  remote workers and global offices feel like a part of HQ with peer-to-peer HD video. This is especially great for field service, where video often can solve the problem like no other solution because you can SEE the issue. In these new systems, modern business communications integrate seamlessly with the productivity apps that employees use every day, making it easier than ever for them to collaborate with docs, emails, and calendar invites.

With this system, a brand can move a phone call from their WiFi to their carrier or from a desktop to a mobile device very easily, so in essence it is very easy to switch calls from device to device (phone, tablet, desktop…) It is also easy to transfer calls between colleagues or departments simply by looking up a name in the directory.

In the ROI research we interviewed two companies, Vivant Solar and a large communication services provider to see how they transformed their on-premises telephony systems to a purely cloud-based communications solution using Dialpad. The change, depending on the situation, resulted in six- to seven- figure cost savings. Both companies previously had legacy, on-premises PBX (Private Branch Exchange) technology, which is a private telephone network used within a company.

Dialpad provides a secure, enterprise communications cloud solution that incorporates traditional PBX features into a modern cloud-based, business communications VoIP system. The solution integrates with Google Apps for Work and with Office 365, with a user interface built to satisfy the needs of a modern workplace but without the typical costs of traditional enterprise, on-premise telephony systems.

The platform offers messaging, voice, video, conference calling in the cloud, attributed call transfer, auto-attendant, IVR, business SMS, MMS, and group messaging, call recording, live-call device switching, international outbound calling, local telephone numbers, multi-device functionality, toll-free numbers, visual voicemail, contact profiles, a company directory and fax support as well as core social profile applications, such as LinkedIn and Twitter for context about the caller. In case you are wondering, has anyone else discovered this service, Dialpad’s customers include 60 percent of the Fortune 500, high-growth enterprises, and forward thinking organizations and start-ups. The service is built on the WebRTC framework and runs on a redundant global network of nine data centers on four continents.

CUSTOMER ROI CASE STUDY: VIVINT SOLAR 

In the evaluation of various technology infrastructure systems, Mike Hincks, Director, IT Infrastructure at Vivint Solar, found that traditional IT voice systems come with hundreds of thousands of dollars of yearly infrastructure and hosting costs, all designed around employees using desk phones. The catalyst for change was to use a system not tied to a desk phone. One of the many interesting features was that Dialpad had no upfront capital expenditures or maintenance costs, which made it easier to get the technology approved by senior leaders at Vivint Solar.

In addition, Hincks looked at the money the sister company was spending on long-distance contracts. With Dialpad, there were no long-distance carrier costs. Hincks also looked at the cost of the team he would need to hire in order to maintain an on premise, hosted solution. The sister company had had a five-person team to manage voice applications. In addition, Hincks would have needed to schedule the IT team’s time to provision a new phone for each employee, with at least one hour of training per employee and some additional time from the IT team for troubleshooting. Dialpad required less than one full-time equivalent employee.

Another one of the biggest conveniences was that Dialpad integrated with Google for Work without any authentication process. “I found the Millennial workforce wants technology to work right away. They don’t want to set up an application, have to go through training or troubleshoot it. They want to click on an app and see it work immediately,” said Hincks.

The positive feedback about Dialed from Vivint Solar’s more than 4,000 mobile workers includes:

  • Improving the ease of signing up and using the communications technology
  • Increasing agility to work anytime and anywhere on any device with technology that doesn’t get in the way of productivity
  • Increasing productivity by being able to use a simple user interface
  • Boosting the ability to make bigger sales at a faster rate.

The ROI: Costs were reduced by several hundred thousand dollars, year over year. Savings came from:

  • No upfront capital expenditure and maintenance costs
  • No long-distance carrier costs
  • No need to hire a team to manage the cloud based communications
  • No need to train employees or engage the training department
  • High user adoption rate because of the simple user interface
  • Improved ability to attract talent by reducing recruiting costs and increasing retention of top talent

A GLOBAL COMMUNICATION SOLUTIONS AND SERVICES COMPANY

In the second company, the Director of Digital Workplace Technologies set up a proof of concept (POC) with Dialpad. He found that the best way to meet the needs of workers in the modern enterprise was using cloud technology. He wanted to re-conceptualize how communications services could be presented to users and to eliminate deterrents to productivity, especially for the geographically distributed workforce that used telephony systems. The Director of Digital Workplace Technologies said, “It was important to look at an IT project as an organizational change management project. We learned this lesson when we moved our users to Google Apps for Work. Technology changes that affect how productive workers are should be seen as organizational change projects. If you can’t find something you are looking for, it makes you less productive and frustrated. So we always overlay organization change management with our IT rollouts.”

DON’T FORGET ORGANIZATION CHANGE MANAGEMENT

The company needed to have a new communications system that could be completely up and running in minutes, compared to months or even years required for deploying global on-premises systems. Applications built in the cloud reduce costs because they are more flexible, extensible, and easier to work with while making collaboration intuitive. And this company found organizational change management was a key element for a successful implementation of this new communications system.

The ROI

Using Dialpad, the company was able to retire several of its old telephony systems and realize millions of dollars in cost savings by reducing:

  • Maintenance agreements
  • Infrastructure
  • Service and support for the infrastructure
  • Phone lines from service providers.

Today, the company has deployed about 6,000 VoIP lines on Dialpad, which cover about 40 percent of its global employee base. It is looking to expand coverage every quarter. The company’s savings were several million dollars, year over year. Savings came from:

  • No upfront capital expenditure
  • No maintenance costs
  • Reduced reliance on IT helpdesk
  • No long-distance carrier costs.

GIVING EMPLOYEES MORE CHOICE, RESULTING IN HIGHER PRODUCTIVITY

After implementing Dialpad at just one large site, the global company reduced the site’s cost per minute of call time by double digits. In addition, the new system offered features that the old telephony systems could not. For instance, the PBX system had been tied to a particular device – the desk office phone. However, most people are now mobile, working from various devices and remote locations. Clearly, workers could not take their desk phones outside of their offices. When workers were away from their desks, they had to use cell phones or other alternatives – from multiple phone numbers – that created additional costs for the company.

Dialpad, however, allows employees use to Voice over Internet Protocol (VoIP) telephony. When the company moved to Dialpad, employees could use their computers to place calls, essentially replacing desk phones. They could also use the Dialpad application on their Android or iOS mobile devices. To the person receiving the call, it all comes from the same phone number, whether the VoIP call is made from a computer or from a mobile device.

Employees could also become more productive. With the ability to communicate from any place, using any device, while still being accessible from a single phone number, people could connect with each other more easily. As collaboration was made easier, the ability for teams to work more effectively with remote employees was also improved. In essence, the company had a new potential to increase the agility and adaptability of its workforce. Employees could be more productive, collaborative and feel more connected to each other using Dialpad.

MODERNIZING THE WORKPLACE 

The new technology enabled the company to modernize its workplace. The company realized that it needed to give employees – as well as new hires and interns – technology tools that are modern, intuitive and easy to use, unlike traditional enterprise tools. The company found employees could easily pick up how to use Dialpad because they were familiar with Google Apps for Work. While moving to Dialpad, the company was also able to shift a portion of its traditional help desk activity to a self-service and community-supported model. In the community, users can ask influencers an guides questions.

WHAT YOU SHOULD CONSIDER IN CHOOSING NEW TECHNOLOGY

Hardware costs and desk phones traditionally have driven the voice communications industry. While struggling for decades to bring down hardware costs, providers attempted to shift to a software model that yielded some feature and cost improvements. However, these changes have not significantly reduced costs, improved scalability, boosted agility or simplified use. In contrast, a revolutionary, exponential change occurs in the telephony industry from using a 100 percent cloud based system designed with the user in mind that is extremely easy to deploy and use while slashing operating costs, eliminating call charges, and offering rapid, unlimited and affordable scalability.

GIVING EMPLOYEES THE RIGHT TOOLS & TECHNOLOGY RESULTS IN BETTER CUSTOMER EXPERIENCES

At the end of the day, it’s really the employees that create the customer experience. And employees can’t do that unless they are given the right technology. It’s up to companies to evaluate the technology they are using and to provide them the latest technology that allows them to be their best. For information about this research study, you can find it here.

@DrNatalie Petouhoff, VP and Principal Analyst, Constellation Research

Creating Great Customer Experiences By Empowering Employees

Share

DX is the New CX- Why Customer Experience Isn’t Up to Snuff

Having been a long-term customer experience advocate and studied the field, I as many others, have noticed that while companies are saying that customer experience is a key differentiator, that it’s at the top of their priority list of business initiatives, that they are spending more on it but when customers are asked, they don’t think it’s better. So how could that be?

I know many customer experience professionals who spend a lot of time mapping out their various customer journey’s for different personas or customer profiles, they have purchased and implemented some of the top omni-channel software, are conducting social media / digital media monitoring so they know what their customers are saying… So it’s not that customer experience professionals aren’t doing what they need to do. But if they are doing all that, why do customer still report, in large part, that their experience of most brands is not up to snuff?

What I discovered is that there are two groups of people that think about customer / digital experience, but in very different ways. One group of people tends to be the typical customer experience professional who has done all of the things I mentioned above and done them well. And then there’s another group of people, often in IT, that worry about digital performance management (DPM.) They look at the technology stack that is underneath the omni-channel customer experience technology and optimize it. They worry about things like page load speed, do shopping carts get hung up, etc…

And I found that often the two groups either don’t know they exist or they tend not to work together. And if that is so, the digital customer experience can suffer. Some brands have optimized both the customer experience, omni-channel technology as well as the technology stack underneath omni-channel technology. When that is done, the customer experience is truly optimized from both the DPM and DX perspective and the CX perspective.

If you’d like to learn more about this, please join me on Wednesday, Sept 28th at Sept 28, 2016 @ 10am PT/1pm ET for a Live Webinar and we will look at this topic in-depth! The topic? What the smartest brands know about CX and what they still may not be doing about it! And here’s a link to the research I just completed on https://www.constellationr.com/research/business-imperative-optimizing-digital-customer-experience. And here’s all the professionals who spend their days work making the customer experience the best it can be with customer experience professionals collaborating with IT professionals. If content is king, DPM is the ACE!

@DrNatalie Petouhoff

VP and Principal Analyst, Constellation Research

Covering Customer-Facing Applications that Create Amazing Customer Experiences

Share