The world is changing at an ever increasing pace. Business leaders face disruption on multiple fronts: changing market value propositions for products, services and interactions. In order to do this, they must tackle non-traditional competitors, new business models, and cyber security. They must also cultivate a multi-generational “digital literate” talent pool and build capabilities to respond to a rapidly changing marketplace. What is at stake? Survival of your organization is at stake.
While many executives are embracing market evolution and digitization in specific product or process improvements, they are not recognizing the depth and breadth of transformation needed to realize its potential. Strategic market and digital transformation requires both business and IT leaders to restructure their operating model, services, infrastructure and security to meet business demands for speed and agility. It requires business and IT leaders to partner in a new ways, focusing technology investments to unlock new and innovative business model and customer experience paradigms that improve customer successes and “ring the cash register” more frequently and meaningfully.
Moreover, today’s emerging generations of customers and employees are different. Millennials paint a vivid picture of what it looks like to thrive in the mobile-first, cloud-first world. We’ll also see this shift continued to profoundly impact the customer landscape… so maintaining the status quo is not an option. These young men and women have grown up not knowing a world without social networks. That has changed how they relate to each other—how they interact and what they expect from commercial interactions. They are much more inclined to put an early spark of an idea out there and crowd-source solutions. More and more disruptive businesses are harnessing this tendency to crowdsource as one key example of business innovation.
(References: left to right 1,2,3,4,5)
For example, KPMG worked with a global auto manufacturer to reimagine the car purchasing experience for a new era of customers. Legacy auto-purchasing, service and aftermarket sales models have been disrupted and will continue to evolve. Buying a car has become as much a technology purchase as a car purchase. Culturally, people also require a very different value proposition from a manufacturer and dealer than when the traditional car purchasing model was built.
The project focused on three key client areas: Business vision and strategy, customer experience, and a move to a more nimble, cloud-based technology platform. It all started with customer journey mapping. KPMG defines “customer journey mapping” as an understanding of the customer or prospect’s unique set of emotional experiences while engaging with the vendor throughout their relationship with the brand. Where are there sensitivities? Where does it not matter as much? The goal is to hit the customer “sweet spot” by designing an experience that matches the expectation. Designing too much over the expectation results in diminishing profits. Designing under expectation results in lost revenue.
Where a lot of companies stumble is that they build the customer journey map and then believe they are done. The next step is to operationalize this by aligning the processes and technologies necessary support each step of those journeys. One of the critical keys to the success of this project was breaking down the legacy silos that prevented the flow of knowledge between business and IT. KPMG utilized joint application design sessions to drive that collaboration, bringing operational teams together by process, that could really focus on future-state design with a keen understanding for of how to overcome both business and IT challenges. The client was able to start working to solve problems it wasn’t able to solve before, at a revitalized pace. This was as much of a victory for the company as the overall net result of the specific project. More importantly, it created value for the customers.
Shifting market dynamics and expectations like these are increasingly setting the agenda for technology and transformational change: Back-office executives (CIOs, CHROs, CFOs, etc) are using the growth/customer agenda to justify strategic investments (e.g. in supply chain improvement or refreshing legacy systems). Some also talk about making their organizations more customer-centric. Having expertise and a track record in customer-related work will therefore be fundamental to consulting firms’ success across a wide range of more traditional consulting services. KPMG utilizes a customer-focused and customer experience led transformation model to help companies address digital disruption.
Your passion for what you want to do in your business is changing how Microsoft thinks about technology. You are setting the technology agenda for our industry, and we are listening, from the CEO to our front line. Reimagined from the core out, Microsoft is focused on flexible technology solutions that help your people can get more done and thrive in the age of digital transformation. Start your disruption conversation today.
- Industry 4.0 in manufacturing, including “new forms of human-machine interaction such as touch interfaces and augmented-reality systems.” Only 48% of manufacturers are prepared for these emerging technologies; 78% of suppliers are prepared. Cornelius Baur et al. Manufacturing’s Next Act. McKinsey. June 1, 2015.
- CxOs see technology as a way to enable growth and differentiation in 2016. (Various sources, Microsoft, 2015)
- 77% of respondents say that greater agility in responding to business threats and opportunities has become a larger source of competitive advantage over the past five years. CFO Research. The Future of Financial Planning and Analysis: CFO.com. July 14, 2015.
- EOs see technology-related change as a way to achieve growth in 2015 and 2016… CEOs expect digital revenue to double over 5 years, from 22 to 41%. Mark Raskino. 2015 CEO Survey: Committing to Digital. Gartner. April 10, 2015
- 77% of business leaders believe that speed in IT is important to their ability to enter new markets and launch new products quickly. Jessica Twentyman. Adaptive IT: Reshaping IT for Competitive Advantage. Corporate Executive Board (CEB). July 10, 2015.