‘Digital transformation’ is one of the buzzwords of our time, but even though most companies know it’s something they should be doing, many are unsure what it actually means for their business, let alone where to start. The often-bandied-about concept, that it’s about the using digital technologies to impact all areas of life, or that it’s all about making every organisation a technology organisation, are both very broad and to be honest a bit nebulous.
Putting the customer at the heart of your strategy
For businesses, however, I think digital transformation can mean something really quite specific – something that perhaps not all businesses have grasped yet. IDC’s European Digital Transformation Practice Survey showed that, when it comes to digital transformation, businesses in Western Europe are mostly putting a priority on increasing operational efficiencies (48 per cent), while others are focusing on improving customer relations (28 per cent) and developing digital products or services (23 per cent). However, by focusing on particular areas, companies are missing the bigger picture. Essentially business success is all about delighting your customers.
Starting with the goal of creating a step-change in the customer service you deliver should therefore not only give you a purpose and focus, it should also impact all areas of your business – as I would argue that everything a business does ultimately comes down to the customer experience.
So, in short, digital transformation must address both the customer-facing parts of your organisation and the behind-the-scenes processes and systems that also impact your customer engagement. The customer experience is the responsibility of everyone in the business, from the car-park attendant to the chairman of the board, therefore digital transformation should eventually touch them all.
Making it holistic
This means that businesses need to develop a system that is constantly looking for ways to improve the customer experience and this needs to operate across all the channels that the customer encounters. If a customer has an excellent experience on the website, and in-store, but not with the call centre or the mobile app, this is not good enough. An omnichannel approach is critical if companies are not to lose market share.
Using digital tools can help remove the silos within organisations to create this omnichannel approach.
It can also help provide that oh-so-valuable context. Research shows that consumers use an average of five channels before they actually buy something. Companies that consistently collect the information from these interactions can use it to create a picture of the buying habits and customer preferences, including how they like to be contacted, and when. Employees who have instant access to this information can provide a better, in-context experience: when a customer gets in touch they know all about them and therefore are ready with the right things to say.
Technology that has open standards will mean that changes a company puts in place are easy to implement across departments and can also be easily replicated by suppliers and other partners. Equally, cloud technology can make it easier and cheaper to create and implement new digital solutions.
The visible impact of digitisation
But does it really work? Well there’s plenty of evidence to suggest digital transformation can tangibly improve customer experience. Uber, is of course the text-book case study. The company changed the business model around cab services by starting with the customer. They asked: ‘What from a customer point of view would an easy-to-use car service look like?’ The firm then went about delivering this by integrating mobile apps, automated processes, and data analytics to more rapidly connect drivers with customers and align pricing with demand. Uber did have the benefit of starting from scratch with no legacy systems, which gave them the opportunity to build an entirely cloud-based service leveraging customers’ mobile devices as their storefront. For companies with big investments in legacy systems, digital transformation is a lot more complicated but is eminently possible.
In the UK for example, IDC has found that financial services companies are certainly making digital transformation pay in terms of customer service. Insurance provider Aviva, for example, has implemented a number of initiatives as part of its digital transformation strategies. Aviva made online resources available for a newly created digital and innovation centre and introduced an online platform that allows customers to view and manage all their life, general and private medical policies in one place. And feedback from customers is overwhelmingly positive.
And it’s not just large companies that are able to transform digitally. Manning Stainton, Leeds’ largest estate agent has around 200 employees at 19 branches across West Yorkshire. Within the estate agent industry, its differentiator is customer service and the firm attributes its success to the high level of service it delivers customers. However, staff experienced poor quality voice calls when speaking to customers and documents were stored at each local site making it difficult to share between branches or with customers. Manning Stainton implemented a new network and employees are now able to share photos of properties and other details with customers via email and social media. While the quality of voice calls has improved enormously there are also many more channels for customers to engage with them over. Overall the new network is making employees more productive and therefore improving the customer experience.
At the end of the day, it’s customers who decide a company’s success or failure. Both the starting place and the goal of every digital transformation strategy, therefore, needs to be a step change in the customer experience. Quite simply, those companies that get this right, will be the ones still in business in ten years time.
Steve Rafferty is the UK managing director of Avaya.