Digital economy: 5 ways to know your business is on the right track

The emerging digital economy throws up a lot of new questions for businesses to deal with. How do they know they are on the right track?

Shifts and disruptions in the market have forced businesses to examine their own processes and approach to ensure survival. One example is within the retail industry and the move from ‘brick-and-mortar’ to ‘click-and-buy’ consumer behaviours, which has had a profound impact.

Some retailers have responded to this change positively and subsequently flourished, others have had to close stores to minimise costs as more and more people prefer online shopping.

Neglecting to tackle the challenges of a digital economy rather than facing them head on will leave many more out of business. But there are five easy steps to see whether your company will prosper in the digital economy and it starts with changes amongst the senior-level executives in the C-suite.

>See also: Conservative Manifesto right on digital economy ambition, but…

1. Include new markets

Leaders who have a digital-first mentality try to remain steadfast from interferences by new entrants and start-ups. Such leaders centre their business around new and adjacent markets and are poised to avoid disruption.

The development of new products and customer experience are their prime concern. Those whose focus is on efficiency, increasing revenue and minimising costs from existing products are hindered.

2. Lead from the top

CEOs are in charge of implementing and driving the digital transformation program. The success of such transformation must come from the higher management level. In contrast, companies who lag behind often delegate the digital transformation program to lower management, treating it like any other technology problem. Unfortunately it isn’t merely a technological problem and so should be prioritised by the C-suite, as it will be the basis for the business in the future.

3. Focus on digital transformation

Companies that are lagging behind have a less focused agenda for digital transformation than digital leaders. These companies’ objectives tend to be disjointed and disorganised, but mainly focused on refreshing existing technology and cutting costs where possible.

>See also: What does 2017 hold for the digital economy? 

However, digital leaders put emphasis on digital transformation and allocate resources to engaging customers more effectively. As well as building out their ecosystem using digital technology.

4. Utilise a dynamic approach

Digital transformation is itself on the verge of major changes and the term will have a different definition for businesses at different stages of their journey. The leaders who are at the forefront today will be much more aggressive in the next three years because of the constantly changing industry.

They will spend significantly more on user and customer experience, structuring their ecosystem to make internal systems reaching their customers, partners and suppliers more coherent. This will have the effect of transforming how they develop value chains to be more digital and connected, and garner them a competitive advantage.

5. No tunnel vision

Fast growing companies and digital transformation are built on the foundations of open thinking. The majority of companies have embraced open standards, open APIs and open source. Having such an approach is crucial to broadening and deepening digital connections between customers and partners, and improving the way they conduct business.

Recent research highlights and supports these attributes and has found that roughly 50 percent of the CEOs at fast-growing companies are taking the bull by the horns and driving digital efforts.

>See also: Supply chain collaboration: key to thriving in the digital economy

So, what can businesses learn from the strategies of these ‘fast-growing’ companies? Here are three things:

1. They commit to an open approach to the flow of ideas and concepts in their organisations. Nearly 90% report the use of open source technologies as important.
2. They adopt a strategy that prioritises customer- and user-first thinking. 85% currently have dedicated user experience teams.
3. They commit to a business model that leads the way in platform thinking and supports a shared economy. Currently, fewer than 13 percent of companies allow their systems for customers and suppliers to connect to them.

For those executives that are struggling to implement a plan and need help knowing where to start, there are three levers they can activate for successful digital transformation. These will spark a rethinking of the way organisations leverage technology:

 Design thinking – this starts with asking who the user is and what their primary problems are. Optimising user experience and customer experience are a relentless focus and guides all business technology decisions. Processes respond immediately to the needs of the user, delivering content when and where it is required.
 Open thinking – collaboration is important in pushing a business forward and innovation from both inside and outside the organisation is encouraged to drive new initiatives. This type of thinking reduces friction and encourages seamless processes.
 Platform thinking – where the desired outcome of systems and solution deployment is to build an ecosystem of partners and customers that exchange capabilities and data in a manner that creates added value. The aim is to create a digital platform that enables you to create repeatable experiences, react quickly to opportunities, and connect users with information and/or services quickly and meaningfully.

>See also: How blockchain will make the UK’s digital economy thrive

Today’s corporate leaders must realise that they need to disrupt or risk being disrupted and those who are not yet thinking about how they will innovate with new approaches leveraging technology are at risk.

Digital transformation is not just a critical stepping stone to success for businesses – but key to an organisation’s very survival. Most companies are currently in a state of digital transformation, and the advantages of this have been well-documented.

However, businesses should go the extra step to achieve a streamlined workflow to benefit all parties involved (employees, suppliers and customers) by propelling innovation, facilitating a smoother working process and creating connections.

A flexible, scalable, and open approach that intelligently activates content and processes is essential, delivering the fastest path for people to interact with information and for companies to respond to changing business needs.


Sourced by John Newton, CTO and Co-Founder of Alfresco Software

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Nick Ismail

Nick Ismail is a former editor for Information Age (from 2018 to 2022) before moving on to become Global Head of Brand Journalism at HCLTech. He has a particular interest in smart technologies, AI and...