Define Your Digital Business Strategy

After a major crisis, find your place in the digital economy.

Info-Tech Research Group

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Analyst Perspective

Build business resilience and prepare for a digital economy.

Dana Daher
Senior Research Analyst

To survive one of the greatest economic downturns since the Great Depression, organizations had to accelerate their digital transformation by engaging with the Digital Economy. To sustain growth and thrive as the pandemic eases, organizations must focus their attention on building business resilience by transforming how they deliver value today.
This requires a value-driven approach to digital transformation that is capable of identifying what aspects of the business to transform, what technologies to embrace, what processes to automate, and what new business models to create. And most importantly, it needs to unify digital possibilities with your customer experiences.
If there was ever a time for an organization to become a digital business, it is today.

Executive Summary

Your Challenge

• Your organization has difficulty adapting new technologies or rethinking the existing business models.
• Your management lacks a framework to rethink how your organization delivers value today, which causes annual planning to become an ideation session that lacks focus.
• There is uncertainty on how to meet evolving customer needs and how to compete in a digital economy.

Common Obstacles

• Your organization might approach digital transformation as if we were still in 2019, not recognizing that the pandemic resulted in a major shift to an end-to-end digital economy.
• Your senior-most leadership thinks digital is "IT's problem" because digital is viewed synonymously with technology.
• On the other hand, your IT team lacks the authority to make decisions without the executives’ involvement in the discussion around digital.

Info-Tech’s Approach

• Design a strategy that applies innovation to your business model, streamline and transform processes, and make use of technologies to enhance interactions with customers and employees.
• Use digital for transforming non-routine cognitive activities and for de-risking key elements of the value chain.
• Create a balanced roadmap that improves digital maturity and prepares you for long-term success in a digital economy.

Info-Tech Insight

After a major crisis, focus on restarting the growth engine and bolstering business resilience.

Your digital business strategy aims to transform the business

Digital Business Strategy

• Looks for ways to transform the business by identifying what technologies to embrace, what processes to automate, and what new business models to create.
• Unifies digital possibilities with your customer experiences.
• Accountability lies with the executive leadership.
• Must involve cross-functional participation from senior management from the different areas of the organization.

IT Strategy

• Aims to identify how to change, fix, or improve technology in support of the organization’s business strategy.
• Accountability lies with the CIO.
• Must involve IT management and gather strategic input from the business.

Becoming a digital business

Automate tasks to free up time for innovation.

Business activities (tasks, procedures, and processes, etc.) are used to create, sell, buy, and deliver goods and services.

When we convert information into a readable format used by computers, we call this digitization (e.g. converting paper into digital format). When we convert these activities into a format to be processed by a computer, we have digitalization (e.g. scheduling appointments online).

These two processes alter how work takes place in an organization and form the foundation of the concept digital transformation.

We maintain that digital transformation is all about becoming a “digital business” – an organization that performs more than 66% of all work activities via executable code.

As organizations take a step closer to this optimal state, new avenues are open to identify advances to promote growth, enhance customer experiences, secure sustainability, drive operational efficiencies, and unearth potential future business ventures.

Key Concepts:

Digital: The representation of a physical item in a format used by computers

Digitization: Conversion of information and processes into a digital format

Digitalization: Conversion of information into a format to be processed by a computer

Why transform your business?

COVID-19 has irrefutably changed livelihoods, businesses, and the economy. During the pandemic, digital tools have acted as a lifeline, helping businesses and economies survive, and in the process, have acted as a catalyst for digital transformation.

As organizations continue to safeguard business continuity and financial recovery, in the long term, recovery won’t be enough.

Although many pandemic/recession recovery periods have occurred before, this next recovery period will present two first-time challenges no one has faced before. We must find ways to:

• Recover from the COVID-19 recession.
• Compete in a digital economy.

To grow and thrive in this post-pandemic world, organizations must provide meaningful and lasting changes to brace for a future defined by digital technologies. – Dana Daher, Info-Tech Research Group

We are amid an economic transformation

What we are facing today is a paradigm shift transforming the ways in which we work, live, and relate to one another.

In the last 60 years alone, performance and productivity have been vastly improved by IT in virtually all economic activities and sectors. And today, digital technologies continue to advance IT's contribution even further by bringing unprecedented insights into economic activities that have largely been untouched by IT.

As technological innovation and the digitalization of products and services continue to support economic activities, a fundamental shift is occurring that is redefining how we live, work, shop, and relate to one another.

These rapid changes are captured in a new 21st century term:

The Digital Economy.

90% of CEOs believe the digital economy will impact their industry. But only 25% have a plan in place. – Paul Taylor, Forbes, 2020

Analyst Perspective

Become a Digital Business

Kenneth McGee
Research Fellow

Today, the world faces two profoundly complex, mega-challenges simultaneously:

1. Ending the COVID-19 pandemic and recession.
2. Creating strategies for returning to business growth.

Within the past year, healthcare professionals have searched for and found solutions that bring real hope to the belief the global pandemic/recession will soon end.

As progress towards ending COVID-19 continues, business professionals are searching for the most effective near-term and long-term methods of restoring or exceeding the rates of growth they were enjoying prior to 2020.

We believe developing a digital business strategy can deliver cost savings to help achieve near-term business growth while preparing an enterprise for long-term business growth by effectively competing within the digital economy of the future.

The Digital Economy

The digital economy refers to a concept in which all economic activity is facilitated or managed through digital technologies, data, infrastructure, services, and products (OECD, 2020).

The digital economy captures decades of digital trends including:

• Declining enterprise computing costs
• Improvements in computing power and performance; unprecedent analytic capabilities
• Rapid growth in network speeds, affordability, and geographic reach
• High adoption rates of PCs, mobile, and other computing devices

These trends among others have set the stage to permanently alter how buying and selling will take place within and between local, regional, national, and international economies.

The emerging digital economy concept is so compelling that the world economists, financial experts, and others are currently investigating how they must substantially rewrite the rules governing how taxes, trade, tangible and intangible assets, and countless other financial issues will be assessed and valued in a digital economy.

Download Info-Tech’s Digital Economy Report

Signals of Change

The digital economy captures technological developments transforming the way in which we live, work, and socialize

Technological evolution

Info-Tech’s approach to digital business strategy

A path to thrive in a digital economy.

1. Identify top value chains to be transformed
2. Identify a digitally enabled growth opportunity
3. Transform stakeholder journeys
4. Build a digital transformation roadmap

Info-Tech Insight

Pre-pandemic digital strategies have been primarily focused on automation. However, your post-pandemic digital strategy must focus on driving resilience for growth opportunities.

The Info-Tech difference:

• Understand how your organization creates value today to identify opportunities for digital transformation.
• Leverage strategic foresight to evaluate how complex trends can evolve over time and identify opportunities to leapfrog competitors.
• Design a journey map to empathize with your customers and identify opportunities to streamline or enhance existing and new experiences.
• Create a balanced roadmap that improves digital maturity and prepares you for long-term success in a digital economy.

A digital transformation starts by transforming how you deliver value today

As digital transformation is an effort to transform how you deliver value today, it is important to understand the different value-generating activities that deliver an outcome for and from your customers.

We do this by looking at value streams –which refer to the specific set of activities an industry player undertakes to create and capture value for and from the end consumer (and so the question to ask is, how do you make money as an organization?).

Our approach helps you to digitally transform those value streams that generate the most value for your organization.

Higher Education Value stream

Recruitment → Admission → Student Enrolment → Instruction & Research → Graduation → Advancement

Local Government Value Stream

Sustain Land, Property, and the Environment → Facilitate Civic Engagement → Protect Local Health and Safety → Grow the Economy → Provide Regional Infrastructure

Manufacturing Value Stream

Design Product → Produce Product → Sell Product

Visit Info-Tech’s Industry Coverage Research to identify your industry’s value streams

Assess your external environment to identify new value generators

Assessing your external environment allows you to identify trends that will have a high impact on how you deliver value today.

Traditionally, a PESTLE analysis is used to assess the external environment. While this is a helpful tool, it is often too broad as it identifies macro trends that are not relevant to an organization's addressable market. That is because not every factor that affects the macro environment (for example, the country of operation) affects a specific organization’s industry in the same way.

And so, instead of simply assessing the macro environment and trying to project its evolution along the PESTLE factors, we recommend to:

• Conduct a PESTLE first and deduce, from the analysis, what are possible shifts in six characteristics of an organization’s industry, or
• Proceed immediately with identifying evolutionary trends that impact the organization’s direct market.

Info-Tech Insight

While PESTLE is helpful to scan the macro environment, the analysis often lacks relevance to an organization’s industry.

An analysis of evolutionary shifts in five industry-specific characteristics would be more effective for identifying trends that impact the organization

A Market Evolution Trend Analysis (META) identifies changes in prevailing market conditions that are directly relevant to an organization’s industry, and thus provides some critical input to the strategy design process, since these trends can bring about strategic risks or opportunities.
Shifts in these five characteristics directly impact an organization:

ORGANIZATION

• Customer Expectations
• Talent Availability
• Regulatory System
• Supply Chain Continuity
• Technological Landscape

Capture existing and new value generators through a customer journey map

As we prioritize value streams, we break them down into value chains – that is the “string” of processes that interrelate that work.

However, once we identify these value chains and determine what parts we wish to digitally transform, we take on the perspective of the user, as the way they interact with your products and services will be different to the view of those within the organization who implement and provide those services.

This method allows us to build an empathetic and customer-centric lens, granting the capability to uncover challenges and potential opportunities. Here, we may define new experiences or redesign existing ones.

A digital transformation is not just about customer journeys but also about building business resilience

Pre-pandemic, a digital transformation was primarily focused around improving customer experiences. Today, we are facing a paradigm shift in the way in which we capture the priorities and strategies for a digital transformation.

As the world grows increasingly uncertain, organizations need to continue to focus on improving customer experience while simultaneously protecting their enterprise value.

Ultimately, a digital transformation has two purposes:

1. The classical model – whereby there is a focus on improving digital experiences.
2. Value protection or the reduction of enterprise risk by systematically identifying how the organization delivers value and digitally transforming it to protect future cashflows and improve the overall enterprise value.

Key deliverable:

Digital Business Strategy Presentation Template

A highly visual and compelling presentation template that enables easy customization and executive-facing content.

*Coming in 2022

Blueprint deliverables

The Digital Business Strategy Workbook supports each step of this blueprint to help you accomplish your goals:

Initiative Prioritization

Use the weighted scorecard approach to evaluate and prioritize your opportunities and initiatives.

Roadmap Gantt Chart

Populate your Gantt chart to visually represent your key initiative plan over the next 12 months.

Journey Mapping Workbook

Populate the journey maps to evaluate a user experience over its end-to-end journey.

Info-Tech offers various levels of support to best suit your needs

DIY Toolkit

“Our team has already made this critical project a priority, and we have the time and capability, but some guidance along the way would be helpful.”

Guided Implementation

“Our team knows that we need to fix a process, but we need assistance to determine where to focus. Some check-ins along the way would help keep us on track.”

Workshop

“We need to hit the ground running and get this project kicked off immediately. Our team has the ability to take this over once we get a framework and strategy in place.”

Consulting

“Our team does not have the time or the knowledge to take this project on. We need assistance through the entirety of this project.”

Diagnostics and consistent frameworks used throughout all four options

Guided Implementation

What does a typical GI on this topic look like?

A Guided Implementation (GI) is a series of calls with an Info-Tech analyst to help implement our best practices in your organization.
A typical GI is between 8 to 12 calls over the course of 2 to 4 months.