Times change, and this year, companies can tell you a thing or two about it. The coronavirus has made it clear that digitalization is a decisive factor for competitiveness. For example, while Amazon continues to expand its leading position, many traditional companies are suddenly on the brink of collapse.
As a result, the speed of digitization has increased dramatically. Many companies respond by initiating various digitization projects, whether in process automation or customer interface, or by launching new digital products, services, and business models. Properly implemented, digital transformation can become a growth driver and way out of the crisis. However, there is a danger lurking here: If you forget the basis of every major project – the development of a strategic approach supported by management – the success factor quickly turns into a tug-of-war within the company.
Due to a lack of coordination, individual projects head in different directions instead of toward each other. Ongoing discussions resulting in a lack of focus and motivation, and inadequate internal and external communication. If the step into the digital era is to be crowned with success, digitization projects must take place on three levels: the strategic level, in the business model, and in the digital operating model.
Three levels for successful digitization
Let’s do this, and off we go – this is often the approach. But comprehensive changes require a strategic first step, despite all the drive to act. Analysis is the keyword here: Where are the weak points so far? Where is the potential? Which goal am I pursuing? Should I optimize my processes and costs, or focus on defending or increasing sales? Can existing platforms and systems be used, or does it require investment? All these questions must be clarified at the outset. Then visions can be developed, and concrete goals defined.
These are implemented on the second level, the business model. The business model is about using digital technologies in the value creation process – for example, through digital products, services, or sales channels in line with the developed strategy. This must always be the customers and their needs.
The third level is the digital operating model, which refers to providing necessary resources for practical implementation. The necessary know-how and infrastructure are built up at this level. Digitization platforms have been particularly popular for some time. Proactively implemented at various levels, digitization platforms enable companies to tap new markets, customers, and reduce costs.