Accelerating Digital Business Models

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Imagine you are a business that serves chicken sandwiches. Your business model includes top notch, friendly service for customers who come into your restaurants, order their food at the counter, pay, and then find a table while they wait for their food to be brought out. It’s a business model that has served you well for a long time. Then, COVID-19 hit. All the sudden, customers can no longer come inside your restaurants, linger at tables and chat with servers. How do you ensure customers can still enjoy the chicken sandwiches they have come to love? Do you even have a mobile app?

The global pandemic forced businesses who may have considered digital transformation years away to instantly respond to sudden and drastic changes. Innovative thinking has been kicked into full gear allowing many companies to rethink the products and services they provide customers and how new value and opportunities are emerging due to Covid and technical connections with customers. IT departments had to ensure teams had the equipment needed to work from home. Employees and managers had to find new and innovative ways to communicate and stay in touch. Businesses had to create new channels of communication to serve the needs of customers. The pandemic was a sudden wakeup call.

Accelerated Path to Digital

The COVID-19 pandemic created an urgency to accelerate the path to digital for businesses. The “wrecking ball” of major change moved businesses that were digitally interested from a slow trajectory of digital growth that was ‘nice to have’ to an overnight necessity. Digital maturity became essential.

“To be relevant in the future economy, to compete, we have to think about what we’re doing,” said Andy Van Solkema, VP of Digital Strategy and Experience. That is categorized in three areas, beginning with short term needs. This includes a businesses’ discovery of the fact that they lack the means to support remote work, or provide telehealth, or collect relevant data for manufacturing in the no touch economy. After businesses handle the immediate need, and put out the fire they must determine: “What are our priorities?”

“We have a few examples with customers where in a matter of two weeks’ time, their position on some of their initiatives changed,” Van Solkema. “We have one customer who reallocated $3 million that was earmarked for face to face events to sell and promote their products, and shifted that completely to digital. Once a business has determined its priorities, it can shift to an opportunity mindset,” Van Solkema said. “This includes business model innovation, product development innovation and ways to explore new opportunities for success.”

For businesses, the focus has changed; the financial philosophy has changed; there have been cultural changes and people and skills have also changed. The sudden impact of the global pandemic forced businesses to accelerate their decision-making process. Businesses have shifted initiatives from an innovation with a clear ROI to a need to have to stay relevant in the future economy. This is challenging our formal definition of innovation all together. Innovation has a connotation as a nice to have exploration of what is next that organizations managed closely. But today “innovations” may not be seen in this same light. They are core initiatives that are affecting business models drastically. In doing so, many orthodoxies and norms are changing right under our feet. Companies who employed a work force for transactional roles may be shifting to e-commerce or point of sale technologies that change who they employ and how they deliver on these connections to customers. This requires new, more agile approaches.

Rewriting the Rules

Organizations are seeing an increase of technology in their consumer businesses. Suddenly, businesses shifted from face to face connections to providing digital opportunities to connect with customers. Organizations that already had plans to make the shift to digital sped up their timelines to do so. By having the ability to show customers virtual showrooms, sales have increased for such businesses. Such changes require flexibility and agility. This is being perpetuated by customer expectations. We expect everything is a 1-2 day deliver because of the experiences we have with organizations like Amazon, DoorDash and Uber.

For hospitals, who could no longer accommodate in person visits for families to see sick patients, the global pandemic forced them to think creatively. Hospitals began using Microsoft Teams and Zoom calls to offer people a chance to say goodbye or hello to loved ones. Medical centers began asking fundamental questions such as: “Why do people come into the hospital at all?” One hospital considered making testing kits available to patients at stores such as Walmart or Walgreens, and then having patients do testing from the comfort and safety of their own homes. Businesses are taking advantage of remote tools to make life easier while away from the office. Additionally, this is resulting in ironically a more personal (or meet me where I am) experience for patients which in turn allows clinicians more qualitative experience in a telehealth visit. Imagine helping a patient and being able to get the name of the vitamins or prescriptions they are taking in real time. Or taking a peek at their refrigerator shelves in a nutrition conversation. Clinicians are benefiting in some ways too.

Throwing Away the Playbook

One of the challenges around accelerating digital business models is creating alignment amongst all stakeholders and determining who has the authority and autonomy to make decisions.

“In some ways this can be revealing for organizations, in that, we had all these rules we had to follow and we’re put in a situation where we have to prioritize and we can pick two rules we have to follow, and everything else you have to let go of,” said Vervint Principal Consultant Karen VanHouten. In some ways, that change can be freeing.

“In addition to looking at things changing digitally, it’s also looking at what you’ve always held to be true as a business. How many of those things are truly foundational to your business and how many have potentially been restricting you from being exploratory and willing to try new things?”

As VanHouten noted, the risk of failure is so much lower right now, because everyone is “making it up as we go along out of necessity.”

Vervint Principal Consultant Rick Harlow noted that the new remote environment means trusting employees to get the job done during the hours that work best for them. That may not mean traditional hours or in traditional ways, but success in this environment looks different for each employee.

“The way that they’re looking at their work now has fundamentally changed,” Harlow said. “No longer is it based on, say, 40 hours, but more on, is the work getting done.”

With all of these shifting horizons organizations need to have a clear understanding of their vision based on market opportunities. Building alignment requires this type of effort to compliment the digital initiatives happening inside organizations. “These projects are hard for organizations not because technology or the discipline does not exist, but because success through disciplined planning does not equal agile,” Van Solkema said. “In fact, it exposes an organizational readiness to act as an agile organization.

“The outcomes they seek are often missing clear alignment towards a transformative picture and when the waters get choppy in a project, which they often do, it is easy to get distracted by the circumstances of familiar processes and planning.”

Digital Isn’t Just About Technology

Digital means so much more than just a website or a product, VanHouten said. It affects multiple parts of your business. Pulling one lever will impact other aspects. For example, businesses are creating a seamless experience for customers to pick up purchases in the new no touch economy. Once you order and pay for a product, for example, you can pick up your item at the store without ever leaving the comfort of your car. Digital, in this case, is far more complex than just one component. Digital is not just about technology, but about serving both internal teams and customers. That’s why so many digital products fail, VanHouten said. “It’s not the technology, it’s not taking into account the impact it has on the other parts of your business.”

Vervint: Your Partner in Accelerating Digital Business Models

The global pandemic has shifted the priorities of many businesses. Is your organization prepared to accelerate the shift to digital? At Vervint, we can help you prioritize your initiatives and determine what steps you need to take to be successful now and in the future. Contact Vervint to accelerate your drive to digital today.

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