What company doesn't want to dub itself a digital disruptor these days? Minimum, said company drums up some good press for shaking up the status quo, and maximum, the company is actually in good shape. According to research done by the MIT Sloan Center for Digital Business, mature companies that are bona fide digital disruptors have 9% more revenue, 26% more profit and 12% higher market valuation than companies that are not digital disruptors.
Unfortunately, many companies that think they are undergoing a digital transformation actually are not, according to Christina McKeon, senior director of product marketing at Oracle and a speaker at the recent Oracle CloudWorld conference in Boston on December 9.
In a study done by the Altimeter Group, a research and advisory company, 80% of the companies surveyed said they believed they were undergoing a digital transformation. Once researchers delved deeper, however, they found that actually only 42% of these self-identified disruptors were investing in digital channels, McKeon said.
"We think there might be a disconnect between understanding actually what digital transformation is," she said. "[Transformers] are the guys that are actually making you uncomfortable in your market." Think Uber and Facebook and Apple and Netflix.
For example, sometimes companies believe that because they are developing a website they are undergoing digital transformation. "That's a long way away from an actual digital transformation," McKeon said. In addition to the website, that company would also need to build a mobile app, utilize social media, be in the cloud and be leveraging all these technologies to provide a seamless customer experience.
So how can you tell if your company is on its way to digital transformation? Here are four pointers from McKeon:
Know the difference between a digital transformer and a follower
McKeon said that while most companies focus on operating as cost-effectively as possible -- e.g., "How can we still satisfy our customers but do it as cheaply as possible?" -- digital transformers are focusing on investing in growth. Indeed, followers invest 300 times more in efficiency than they do in growth opportunities, according to McKeon.
Another difference between the transformers and the followers?
"[Transformers also] have a sense of urgency; they see themselves as having to act very fast and move very quickly," McKeon said, while -- you guessed it -- followers tend to think they have plenty of time.
One important step toward becoming a transformer is to create what McKeon calls a journey map.
"If you haven't mapped [your digital] journey it's very hard to understand how you can be undergoing a digital transformation," McKeon said.
Mapping out your digital journey helps, she said, because it forces you to review the ways you interact with customers and the impact of those interactions on company results, from the buying cycle to what happens when a customer becomes a customer."You have to not only look at every touch point, you [also] have to make sure you're looking at every digital touch point as well," she said.
Multichannel vs. crosschannel vs. omnichannel
How do companies fare on the digital "touch point" scale? "Typically, about a little over half [of customers] are using three to four channels [a day]," McKeon said. She added that it's important to understand how the service channel your company is using looks to your customer.
To a company, multichannel means using multiple channels in order to connect with their customers or users, McKeon said. But multichannel engagement done wrong can give customers the impression they are dealing with different companies rather than different aspects of an outreach from the same company.
At companies whose brand offerings are consistent, customers may associate each channel with the same brand but still may not be getting a fluid and seamless experience, she said.
McKeon said that what all companies should be striving for is omnichannel -- or providing a seamless experience across all channels that customers identify as your brand because of its high degree of personalization. "That's when you customer doesn't perceive any channel. The only thing they see is your brand," she said, adding that Zappos is a good example of a company with an omnichannel customer engagement approach.
An equally important factor in ensuring a company is on its way to digital transformation is employee engagement. "Organizations are starting to understand that the job that I do engaging employees directly impacts the success and results of my organization," McKeon said.
Recent research by Bain and Company, a consulting firm, polling customer service agents on how much they admired the companies they work for found that only 60% of agents would recommend their companies to a customer. So what's wrong with the other 40%?
"What we often find is they aren't empowered to serve the customer. Despite the customer service agents' access to internal systems, McKeon said, respondents in the research complained that customers often have an easier time finding the answer to their question than an agent does. Companies need to work to make access to information easier for their employees, not only to make them more efficient at their job and to keep them engaged with customers, she said, but to make them good ambassadors for their companies.
"It's not so much they're not happy with the work environment or something like that; it has more to do with how frustrated they get just trying to get an answer for a customer," McKeon said.
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