Today, you cannot read a newspaper without being confronted with the threat of digital companies attacking your market, and how you as a business leader should redefine your business.
Are you tired of hearing how you should reinvent your business before unknown digital players one day pop up out of the blue and destroy your business using innovative business models and new technologies?
I fully understand. I have been there myself. But is it really true? And how can an established business embrace the opportunities and threats of the digital world?
No doubt, that many markets have been extremely disturbed in recent years – or disrupted, as we call it. The changing climate moves significantly faster than ever before, and today it does not take ten years before a pioneering idea in San Francisco comes to a local suburb in Denmark. It might be one or two years at the most, which means shorter time for the companies to reach.
This means that each senior executive must have a plan for addressing the digital opportunities and threats.
I suggest to follow some concrete pieces of advice:
Outside-in. All major market changes occur when a competitor offers a different customer experience. So look at how your customers perceive you, and then define how the optimal customer experience should be in the future. Forget all doctrines from the past, you must go back to the drawing board and think big.
Think leadership first. If you do not have the management capacity to define the ultimate customer experience, it is time to evaluate the composition of the management team. Where do new ideas come from? In addition, how do you achieve activeness to take the visions from paper to the market? Without skilled managers, nothing happens.
Build on what you already have. It does not help changing your business model from being a baker to a butcher, if the only thing the company is good at is baking bread. The transformation is then too risky and it will take a long time. The starting point should be what you are good at doing. The same applies when it comes to technology. Think about how you can reuse, integrate and share instead of replacing.
Start small and take chances. Do not make huge plans. The markets change fast and long-term plans usually do not last. Start with smaller projects and learn how the customers receive the new initiatives. However, you must also take chances and trust that the initiatives are good enough to mean something for customers. Otherwise, you lose time and money, which might open a loophole for competitors.
So next time you hear how digitization will change or destroy the future of your business, then ask the question: How? If you do not have the answer, it is time to look at the four pieces of advice above.