Digital Transformation - Encore Business Solutions

Digital TransformationTracey Santos

Welcome

Digitally aware?

Alert Ready: Skynet is now active

Market Overview

Witnessing Papal history in 2017

Market Overview

At the age of 4 years:

• 30 Million daily users

• Valuation: $1 Billion

• 13 employees


• 100 million daily users

• Valuation: $4-5 billion

• 20 employees


• 65 cities

• 1.5 Million drivers

• Valuation: $3.5 Billion

• Employees: 550


• 1.5 million rooms(largest lodging company on earth)

• 134,000 cities

• Valuation: $20 Billion

• Employees: 2,368*

*Hilton has over x40 more employees

Market Overview

HBR studied 30,000 public firms over a 50 year span:

• ½ of the companies listed in the year 2000, are no longer there

• An estimated ⅓ of companies expected to delist over next 5 years

• Life expectancy for companies has fallen from 56yrs to 18yrs

• By 2020 60% of all enterprises will have fully articulated an organization-wide digital platform strategy

• By 2021, enterprise apps will shift toward hyper-agile architectures, with 80% of application development on cloud platforms

• By 2021 organizations will spend more than 530 billion on cloud services and cloud enabling IT

• By 2020 50% of the workforce will be “digital native” connected 24/7 and work the way they want to

What’s in it for us?

Dig

ital In

tensity

Fashionista

• Many advanced digital features

(mobile, social etc) but in silos

• No overarching vision

• Underdeveloped coordination

• Digital culture may exist in silos

Digirati

• Strong overarching digital vision

• Good governance

• Many digital initaitves

generating business value in

measurable ways

• Strong digital culture

Beginners

• Management skeptical of the

business value of advanced

digital technologies

• May carry out some

experimentation

• Immature digital culture

Conservatives

• Overarching digital vision exists

but may be underdeveloped

• Few advanced digital features

though traditional digital

capabilities may be mature

• Strong governance across silos

• Taking active steps to build

digital skills and culture

Source: Capgemini: the digital advantage

Aligned leadership


Dig

ital In

tensity

Fashionista Digirati

Beginners Conservatives

Revenue Generation

+6% +10%

-4% -10%

Source: Capgemini: the digital advantage

Aligned leadership


Dig

ital In

tensity

Aligned leadership

Fashionista Digirati

Beginners Conservatives

Profitability

-11% +26%

-24% +9%

Source: Capgemini: the digital advantage © Digital Infusions Pty Ltd 2017

What’s in it for us?Revenue vs. Profitability

Source: Capgemini: the digital advantage © Digital Infusions Pty Ltd 2017

Case Study: Disney

Case Study:Domino’s

Case study: Lego

Case study: Shopper Media Group

Repositioning IT

Core services

(Fulfillment driven)

Differentiator

(Function driven)

Innovation

(Outcome driven)

Traditional

Emerging

Attributes Traditional Emerging

Goal Stability Agility

Value Price for performance Revenue, Brand, Experience focus

Approach Waterfall, High ceremony Design Thinking, Agile, Lean StartUp

Governanc

e

Plan driven, approval based Empirical, Continuous, Process based

Talent Likes certainty Good with ambiguity

Culture IT centric, Removed from customer Business centric, close to customer

Cycle

times

Months Days/weeks

Innovation investments made

Business

model

Finance

Networking Channel

Delivery

Brand Customer

experienceCore

process

Process.

Enabling

process

Product

performance

Offering

Product

system

Service

Hi

Lo

Volume of innovation effortsLast 10 years

Source: Doblin analysis

Value Created

Business

model

Finance

Networking Channel

Delivery

Brand Customer

experienceCore

process

Process.

Enabling

process

Product

performance

Offering

Product

system

Service

Hi

Lo

Cumulative value creation—Last 10 years

Source: Doblin analysis

Counterintuitive

What is Digital Transformation?

Digital Transformation (DX)

Definition

• Altimer Group • “Digital transformation entails the realignment of, or new investment in,

technology and business models to effectively engage customers at every touch point in the customer experience lifecycle.”

Capture DeliverArrange NEEDVALUE

Mode 2: Disruptive

thinking

Mode 1: Efficiency thinking

What is digital transformation?

NEEDVALUE

Capture Deliver


Arrange NEEDVALUE

Capture Deliver


Arrange NEEDVALUE

Mode 2: Disruptive thinking

Capture Deliver


Arrange NEEDVALUE



Capture Deliver

Bringing it together

Arrange NEEDVALUE




Mode 1 Mode 2

Mode 1: Top 5 Traps

Organisations often get stuck because they:

1.Forget to start at the beginning

2.Delude themselves by doubling-down on the things that are no longer working

3.Attempt to get house 100% in order before thinking about Mode 2

4.Forget to prioritise against future state

5.Forget to retire/divest

Mode 2 traps! • Failure to provide space from BAU:

• Todays work is more important than projects of ambiguous value

• No financials allocated

• Stringent requirements to complete a business case before launch

• Immediate KPI’s & Incentive structures don’t allow time for new initiatives

• Lots of politics required to gain sign off

• Wrong capability:

• Staff are trained to maintain lines of business not develop new ones

• Commercialisation is hard!

• Poor governance:

• No senior leader oversight (including board level)

• Run as a project within a department (usually IT), rather than approached as an all of business initiative

• No metrics or incentives around new revenue growth

• No filter mechanisms to identify a good idea

• Starting in the wrong place

• Poor market validation

• No clear understanding of “job to be done”

• Pain targeted is just not painful enough, or felt by enough people

• Companies struggle to determine where to disrupt

• How to lead the change with other commitments

• Organizations are built to resist disruption

• Change Management not understood/taken seriously

• Social is not being used properly in business setting

Digital Transformation Maturity Model

A Year from Now You Will WISH You Started Yesterday!

• Executive agreement

• Executive understands innovation (DX)

• Create a formal process for disruption in your organization

• Criticality of / methodology for Change Management

• Social to get your organization to acceptance faster

Let us show you how!

Questions?

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Digital Transformation - Encore Business Solutions

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