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We have three years left of the teenies, the name given by some to the period between 2013-19. For some business leaders, it’s probably fair to say that the decade thus far might have felt as awkward and fraught with change as they experienced during their teenage years.
The internet and the new digital landscape created has drastically altered not just the what, where and how of daily operation but also the ‘who’. A new breed of customer is online 24-7 and expects his or her suppliers to be the same. They have higher and completely different expectations along with the power to rate and review a product or a service in the most public of ways.
Meanwhile, globalisation and the digital environment has meant more competitors than ever can vie for their attention and custom. Loyalty no longer counts for much, evidenced by professional services firm Accenture’s finding that the ‘switching economy’ is worth more than $6 trillion.
While, like many teenagers, businesses will be keen to escape this uncertain decade, for those organisations which have yet to respond strategically to the impact of the digital world, time is running out. Much has been written about the rise of the Millennials as employees and customers and their different values and behaviours but wait until there is an influx of the so-called Centennials. Those who arrived in the world after the Millennium are the true born digital generation who have literally grown up with Facebook and regard YouTubers as their peers.
Although digital does represent a major fear factor for some senior leaders, a failure to respond renders organisations unfit to seize its potential opportunities. And, crucially, they are missing a golden opportunity to fuel future growth.
A research programme carried out by Rialto involving more than 1,000 respondents only serves to underscore the fact senior leaders don’t always fully understand what digital really means. They know it encompasses a website and maybe an app as well as a requirement for programmatic advertising but they still don’t understand its true impact or how to serve the new wave of digitally-savvy customers.
Technology and data gives organisations more ways than ever to understand the needs and desires of customers and to unprecedented levels. It also enables organisations to tune into and map the customer journey with all its various touchpoints and in doing so find ways to enhance the relationship and services offered to them.
Organisations need to understand the influences and behaviours of their customers and why they choose one store or brand above another. It is this knowledge that will ensure customers are won rather than lost on this new digital battleground.
Many businesses are neither building sufficient capability nor the organisational culture to achieve this though and transitioning to digital brings many fresh challenges. In some cases, leaders need to break out of their comfort zones and adopt a culture of greater innovation and risk – and to do this at the speed of start-ups. They must prioritise ideas and demonstrate bold leadership. And they may have to acknowledge that these capabilities may not exist within their organisations.
If this is the case, the capabilities need to be sourced externally and could mean forming alliances and working with ecosystems comprising of academia, tech start-ups, members of the gig economy or even competitors. Ford recently invested $1bn in the artificial intelligence start-up, Argo AI, because it wanted to benefit from combining the “speed of a start-up” with the automaker’s strengths in scaling technology, systems integration and vehicle design to acquire a leadership position in the development of autonomous vehicles.
Even the major players acknowledge that game-changing innovation does not come from working in isolation and adopting a collaborative leadership style and culture will be paramount.
Lesley Lindberg and Richard Chiumento.
Lesley will be co-presenting a leadership session at Rialto’s offices on 24 February 2017 where creating this digital mindset for growth will be explored in greater detail. To find out more about how the Rialto team are supporting clients on improving organisational culture and developing their future growth strategies, please get in touch.
To book a complimentary place at: How to develop culture to fuel stellar growth, click here.
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