The secret of putting people at the center of digital transformation
I continually hear about the challenges involved for businesses in implementing “Digital Transformation,” what it entails in terms of changes and investment to keep up with new trends and how this revolution is changing day-to-day life at companies. The usual thing seems to be to think about digital transformation as an end in and of itself, when in reality it is a means to capitalize on the realization of business objectives.
We are fortunate to be living during a dynamic moment in history, a new industrial revolution in which advances such as the Internet of Things, digital media, new storage technologies, big data and connectivity 3.0 are opening up new avenues for business efficiency and tearing down barriers. The issue now is how to get digital transformation to operate in our favor and not become an enemy that takes us by surprise and leaves us coming last in the race.
Although there are many factors involved in achieving a successful digital transformation, I would like to highlight several of the steps below:
Globalization: Without leaving home, we can access an unimaginable amount of information about anyone. With just a few clicks, we can find a group anywhere in the world, access their webpage, find information on their Facebook or Twitter profiles, or through any other social networking service, as well as listen to their songs on YouTube (the MTV of the 21st century). As a result of this ease of distribution, businesses became global-scale companies that can distribute content anywhere in the world with similar ease, and not only content, but also any other product, with minimal distribution costs, physical presence or investment in advertising.
It is people who ultimately drive and make possible any change, so the step prior to digital transformation must be the involvement of the team
Digitalization: Thanks to the Internet, we can access a catalog of music or any other content from our computer in a way we could never before have imagined. Content distribution and storage is becoming digital. The cloud is king and access to information can be obtained from any device and location; there are no physical barriers to work.
The power of users: Digitalization, supported in turn by the connectivity offered by the Internet and penetration in all markets of smartphones, enables any business to use fewer intermediaries. The Web replaces transportation and logistics, but above all, it gives power to consumers. They decide how, when and where, evaluate the product and service and also provide the platform itself with information to improve it. Uber has shown that, by trusting consumers, it is possible to transform a transportation business.
Consumption, anytime, anywhere: One of the consequences of technological innovation is the growing ubiquity of music: there are few spaces where it is not present. Ease of shipping and storage lead us to consume, for example, content, videos, TV series and movies differently, since they can be purchased, stored and enjoyed virtually anywhere we may be. The key is that any business strategy must have its “mobile” expression, either through an app or direct interaction with cell phones.
Learning, the secret of cooperation: In business environments, this has fostered different services and platforms to enable user interaction in the creative process (the power of crowdsourcing, group collaboration tools like Slack). This is a factor for change resulting from the above; the possibility of working together collaboratively, even with a large number of people from very different locations. This collaborative process can create value that is not attainable individually and accelerates learning and knowledge generation exponentially.
Transformation of business models: Something that is extremely obvious due to the impact it has had on conventional large “industries” is the emergence of new players that are outside the sector and have come along and transformed business models. Clear examples can be seen in the record industry with the emergence of iTunes, or in the distribution or retail industry with the impact of Amazon, and most disruptively, the successes of Uber and Lyft.
Change in distribution models: The impact on distribution models produced by companies that have created new models and have been able to take advantage of the change in user behavior brought about by technology. An obvious example is the impact Netflix has had on traditional U.S. networks such as Warner, Columbia, Metro Goldwyn Mayer, Universal and Paramount… the leaders in the distribution of content in digital format are no longer local distributors, but global online distribution platforms or the content creators themselves distributing over the Internet.
But lastly I would like to examine in more detail one factor I believe to be critical because it directly touches the heart and soul of companies: The new workforce.
Digital transformation is the transformation of a company –processes, communication, marketing, sales, management, customer service, culture, etc.– and that necessarily translates into the transformation of people.
PEOPLE IS AN ENGINE FOR CHANGE
Neither the largest investment nor the best technological system will achieve any progress at all unless we have done the groundwork of “evangelizing” the team. They are the people who ultimately drive and make possible any changes, so the step prior to digital transformation must be involving the team in the business objectives behind each innovation. If we can get employees to internalize the reason for change and feel part of it, then we will have come a long way.
The other issue is the importance of developing digital talent in team members, starting with management. And this entails first defining what profiles the company will need in this new stage, comparing them with the level of digitalization of the team of people and developing a digital training plan to ensure the whole organization has the necessary knowledge and tools to contribute according to their role to achieve the transformation objectives. While it is true there will be areas that will require more specialized skills in certain topics, such as communication, processes or analysis, the central idea is that the entire company is capable of riding the wave of change and surfing it dependably.
It is also very likely this whole process will throw up the need to incorporate new profiles or enhance the talent of current team members who might help lead the process in very specific areas.
THE HUMANIZATION OF COMMUNICATION
As in all aspects of our lives, digital transformation is also occurring in communication. Techniques and tools that were effective yesterday no longer are today; there has been a 180 degree turn in the way we communicate. Companies are now closer than ever to their stakeholders; thanks to the Internet, connection is permanent and communication much more direct, which means a major change in strategy.
At LLORENTE & CUENCA, we have identified three essential requirements for efficient communication in the current context:
First, the transformation of formats and development of transmedia content. In a ‘world overloaded by information, with millions of messages being transmitted every second, producing effective storytelling expressed in attractive formats and transmitted on the appropriate platforms is crucial.
Second, the leap from monitoring and mass communication to active listening and personalized communication. Social networks offer companies the opportunity to receive information from their customers directly and proactively; all that is necessary is knowing how to listen in order to convert that data into intelligence and raw material for creating an effective marketing strategy.
A company’s reputation is built by all of its members day by day
And third, the humanization of communication. If we want to communicate with people, we must do it through people. If technology has totally empowered consumers, then it is necessary for us to also empower our team members, to give the organization a “face” and foster large-scale interaction… to get the corporate discourse across using people.
It is no coincidence that today’s corporate leaders excel in digital arenas. From 2010 to 2014 alone, the presence of the top 50 Fortune 500 companies in corporate or their own digital channels increased by 80 percent.
The likes of Warren Buffet (Berkshire Hathaway) or Richard Branson (Virgin) have fully understood the line between public and private has been blurred and so they have been able to capitalize on their Web presence as a reputational asset to their companies.
THE EMPLOYEES ARE THE BRAND
A company’s reputation is built by all its members day by day. There is no better advertisement than us. Investing in new tools, the development of the digital identity of professionals and converting employees into brand ambassadors on social media makes each of them a “hub” that is able to influence their immediate environment.
In a recent study, the firm Altimeter found a significant relationship between the use of social networks as internal tools and the level of a company’s engagement with its employees. Similarly, it found that employee advocacy programs not only humanize brands but have a direct impact on sales by creating an image of credibility vis-a-vis consumers.
This is a capacity that has already been “installed,” so to speak, because virtually all of us use some social network; so with the media already having been created, the work consists of involving the team in the company, creating an identity and sense of belonging, which can be properly oriented through employee advocacy programs.
More and more companies are becoming convinced of this and are investing in developing their people’s digital capabilities, implementing attractive programs to encourage their participation in brand-building.
Technology has certainly changed our world but we should not lose sight of the fact that companies are made up of people and it is on them that the success or failure of any transformation depends. Being at the forefront of trends and technology, innovating and competing in digital markets is not an objective in itself, it is the way to be competitive in a new economic and social context.