What exactly is a modern digital strategy?
This question inevitably arises when companies make their main investment in digital technologies. Much of each investment is focused on applying new technologies to existing products, practices and processes. In this sense, the digital strategy is very close to the IT strategy, which is a process leading to the choice of technologies in which to invest. This approach provides a plan or roadmap for the company to follow. However, digital strategy is not an IT strategy and requires a different approach.
Adapt the company’s website to mobile devices, add data analysis or offer new online experiences to users – what is the next step to take? These investments mainly change the form of interaction, and to a lesser extent the function. Transforming the business with the help of digital technologies, especially in the field of marketing, makes sense because there is a frequent change in consumer expectations, opportunities and information. As companies near the end of their first digital journey, the issue of digital strategy is once again on the agenda for directors.
The next stage of creating a digital strategy
What should be different about digital strategy? This is the first question you need to ask yourself. Repeating something that has worked well in the past does not guarantee success. That is why it is important to choose a specific direction for the mobile-first strategy. At the most basic level, there are two options.
The first option is to expand digitalization by applying the current model for the introduction of technology to new business processes and functions. This is the path to automation and integration, which has already been followed once through the IT strategy. Starting with resource planning, the strategy is repeated for customer relationship management, supply, sales, new product development and other operations. Other examples of strategies for applying new technologies to existing activities include the digitalization of financial management and human resource management through specially designed business software.
The transformation of the business, and hence of the business, is the second option for a digital strategy. This was the promise of the first generation of digital strategies, but very often strategists returned to the habits of IT transformation in the face of organizational, managerial and other obstacles imposed by tradition. Taking this path recognizes the work that has already been done, but also requires asking the question: should the digital strategy be similar to the one already established or can it be different? An in-depth response is required here.
Let’s clear the definitions of “digital” and “strategy”
Experience changes perceptions. Companies are rapidly gaining experience in the digital world as their understandings evolve at a rapid pace.
Digitalization is more than just a set of technologies in which you invest. It is in the abilities and skills that these technologies create. This gives a very broad definition of digitalization, which over time has been reduced to the following: Digitalization is the application of information and technology to increase human productivity.
Human productivity is at the heart of digital transformation. It leads to the creation of specific value, which in turn leads to higher revenues. Alternatives to digitalization can contribute to greater efficiency mainly by reducing costs, but their effect is short-lived. In the long run, they reduce savings and slow growth.
The digitalization of an activity becomes just another technology, when what people do does not change in a way that improves their abilities and helps to achieve the set goals. The idea is not just to integrate a technology and extend it to all processes in the company. Such an approach would not be effective.
Digital technologies offer more than additional rounds of automation. It is important to reduce the idea of a strategy to its essence. Strategy as a term becomes too complex, burdensome and restrictive. It must be simplified to its basic elements. Here is a suggestion: The strategy includes setting the direction, arranging resources in a certain order and taking on responsibilities.
As long as the debate over what exactly the strategy is continues, these elements can precisely define the transformation. The direction answers the question “Why” in terms of ambition and the exclusion of alternatives. The ranking provides answers to the questions “When” and “Which first”. Resources and commitments complement the discussion by answering the questions “What” and “Who”. Giving clear concrete answers to these questions is the basis for building a digital strategy.
Business strategy for success in the digital world
Any technology with the potential to bring transformation begins its life in isolation, and digital ones are no exception. Mobile applications, cloud technologies and customer relationship management software are just some of the examples. Each had its own strategy before joining the business strategy. This is one of the reasons for the confusion regarding the terms “digital” and “strategy”.
The goal is to make digital strategy the basis of business strategy. Once the two terms have been clarified, the teams can take concrete action. The main question that needs to be answered is: How can a business benefit by using information and technology to increase human productivity? This is the digital strategy, once you have started to look at it not just as an investment limited to the introduction of a specific innovation or development only of marketing.
How to make your digital strategy successful in 2021?
Each company draws its digital strategy based on its own goals, market orientation and target audience, but there are basic principles that are imposed by overarching factors, the most important being the change in technology. How to reflect this in your strategy in 2021?
The main focus should be on consumer engagement. A modern company must create innovative ideas and without wasting time, provide them to its customers in the form of solutions that are adapted to meet their requirements. Customers must use the products and / or services in question in the way that benefits them most.
Here are five guidelines to create a digital strategy that has a strong positive effect on your business in the New Year.
Focus on people
At the forefront of every project, from concept creation to the launch of the finished product, should be consumer engagement. One of the growing trends is the involvement of future users of the product in its creation. After its market debut, managers must continue to monitor consumer behavior.
Analyze how your products are used and use an effective process for their optimization and development. For this purpose, you can diversify the techniques in the different phases of the product life cycle. The method for testing conceptual design with real users for example, it is becoming more and more widely used. When launching the product, an online mechanism must be built that provides reliable and timely feedback.
The focus on people must be both externally and internally. Building strong teams that include professionals from different fields increases creativity and productivity compared to working in departments. Relationships with contractors, such as suppliers, must also be optimized in accordance with this way of working.
Strong business partnerships are increasingly important in the digital field, as a high level of technology requires work on several different fronts and large investments, especially in long-term projects.
Success in the digital field does not only depend on the use of the right technology that helps the business to transform and progress. While the website and mobile application are already becoming fundamental for a company, managers must be prepared for changes in the tools used, as well as for the integration of new ones. In this way, companies will be able to adequately respond to changes in the requirements of the business environment.
The digital strategy is a great roadmap for the company to follow, but it cannot remain fixed forever. If consumer attitudes change, you need to have the flexibility to respond. Flexibility in business is determined not only by the technological level, but also by the internal worldview and understandings of the people who work in the organization.
It is not possible for a business to progress in the digital age without creativity. Innovation and flexibility go hand in hand. To provide the best products and services in the digital space, you need to create an appropriate collaboration environment to help generate creative and progressive ideas.
Combining different ideas can give you the most effective solutions to overcome the challenges you will face. This is the basis of competitiveness in every field, whether it is the provision of business services or online retail.
Make full use of statistics
Analyzing statistics is what every company needs to exist and grow. There are two main elements in using the analyzed data in a company. First, it must take advantage of the opportunities they provide in every aspect of the business, such as achieving greater efficiency and reducing production costs (or providing services) and creating more profitable marketing campaigns better targeted to the target audience. Secondly, data protection needs to be worked on.
You need to be aware of what data is available to your company and how you will use it in the most reasonable way. You also need to know which types of data will need the most protection. By protecting them, you also protect your business. The use of data and their protection should not be seen as two divergent activities, on the contrary – they should be administered together.
Manage services effectively
In the age of technology, companies are constantly increasing their consumption of services and this will be a trend in 2021. You need to determine how you will buy services, how you will finance them and how you will get the most out of them.
Focus on the contractual relationship in the provision of services, which are very different from those in the purchase of material, for example. Leading in this case are operating, not capital costs. It is important that the purchase and consumption of digital services are in line with the dynamics of the company’s business process. You need to be flexible when using them so that you can respond to cyclical fluctuations and trends in your business, whether monthly, quarterly or annual.
A business that uses digital services intensively must prepare all its units for possible changes in the operating model in terms of costs and technical integration.
Add value to your business
It is now fashionable for business to be in the digital space, but just having a presence usually does not bring much benefit. How would a website be useful, for example, if neither its content nor its design had been updated for years? The “just for the idea” approach is useless. Instead, you should look at websites, mobile applications and other digital platforms as long-term tools for your business to add value to it and get a high return on your investment.
Planning is of great importance both for the project of building the website or mobile application, and for its use. Risks and opportunities need to be assessed and the size of the investment determined with precision. One of the fundamental conditions for using any digital tool is that it can be adapted to the enterprise in its development process, especially in terms of scale.
When the activity of a business is increasingly oriented towards the digital space, it requires a change in the way of thinking. The risk is undoubtedly higher, especially when entering a little developed area, but it can be reduced effectively. At the same time, the opportunities for profit and growth are much greater.
In conclusion, the main goal of the digital strategy is to move your business forward and this can only be done by giving value to users and added value to your organization. When you enter the field of innovation, you must be ready to adapt and develop faster than ever.
If your business needs a comprehensive digital strategy or if you are planning a new web project or one in the field of mobile applications, our team can help with consultation and overall implementation. Tell us more by sending an inquiry here.