For the past eight years, business leaders have used Forrester's eBusiness and digital marketing assessments to mature their firms toward excellence. In 2013, we introduced a comprehensive digital maturity model that consolidated our interactive marketing and eBusiness maturity models.Two years applying the model with clients have helped hone and focus it even further. Our latest report, the Digital Maturity Model 4.0 updates our 2014 digital maturity model into a single set of scoring criteria that today's cross-functional digital leaders can use to benchmark how well they use digital to drive competitive strategy, enable superior customer experiences, and create operational agility.
Digital maturity demands cross-functional collaboration. Digitally mature firms do so much more than deliver great technology. They understand that digital execution demands the rightculture, organization, technology and insights. That’s why we define digital maturity across those four key dimensions. Our assessment outlines key best practices for how firms drive a digital culture, how they organize and resource digital teams, how they invest in technology and how they steer their strategy and execution with customer-driven insight.
The mass adoption of consumer broadband in the late nineties and early 2000’s helped firms like Amazon, Expedia and Intuit establish new business models and new ways of scaling to millions of customers. Selling products online and empowering customers to find the best deals on travel or financial services products changed market dynamics in a range of industries. But things aren’t slowing down. Quite the opposite, in fact.
Digital continues to change how your firm makes money. Perhaps not fundamentally yet for your firm, but don’t kid yourself, there are changes afoot. There’s obvious examples:
Business leaders don't think of digital as central to their business because in the past, it hasn't been. But now your customers, your products, your business operations, and your competitors are fundamentally digital. To win in this new world, digital leaders must reimagine their businesses as fundamentally digital. Do this, and you can become a digital predator; fail, and your business will become digital prey.
This isn’t a fundamentally new message from Forrester. We’ve been saying this for a couple of years now. But what we have done is update our thinking and our data on the subject based on our most recent research and a major new survey in partnership with Odgers Berndtson.
The result is that we’ve updated the Digital Business Imperative- the anchor document for our Digital Business Transformation playbook. In some ways it's disturbing reading, because while the overwhelming majority of executives now acknowledge that digital will disrupt their industry, just over a quarter think that their firm has an appropriate strategy in place to respond.
When it comes to digital, we are at a pivot point. Digitizing your business isn’t about technology: it’s about customer obsession - and in 2016, it will be among your ten critical business success factors helping position your firm for success in the Age of the Customer. In fact, next year will be a year of consequence: those firms that “get digital” will begin to pull ahead, and those firms that don’t will begin to look increasingly archaic, facing the risk of extinction.
The preliminary results from our recent digital business survey are telling. An increasing number of firms are reporting that they have a coherent and comprehensive digital strategy. While this is good news, these firms are still the minority. The vast majority of firms report that their approach to digital is limited at best, and non-existent at worst. But the consistently bleak picture is that most executives think the wrong people are in charge of their digital activities and few (very few) think they have the capabilities to deliver.
But there are some shining lights.
Leading firms like John Deere are pathing the path to digital mastery, demonstrating revenue and share price growth that outpaces less digitally savvy competitors. Executive committees are taking note. Innovation spend is on the rise, digital skills are in hot demand, and a new breed of digitally savvy senior leaders is finally emerging.
Deliver exceptional digital experiences. It sounds easy enough, but to win in the age of the customer, businesses must realize that there is much at stake if they do not focus efforts on providing customers with a solid customer experience. Forrester even argues that, in the coming years, it’s the customer obsessed digital leaders who will push far ahead of their competition. But how can they get there?
To help digital leaders exceed the expectations of their empowered customers, Forrester has designed this week’s Digital Business Forum around how to build a strategy that works — now and in the future. Liza Landsman, executive vice president and chief customer officer of Jet.com will be on stage alongside Forrester analysts Stephen Powers, Adam Silverman and Alyson Clarke to share her experience in digital business transformation.
At Jet.com, Liza is responsible for producing a compelling end-to-end customer experience with the tools and technologies that drive growth. I’m happy to share the below Q&A session with Liza — I caught up with her in advance of her keynote, and she was kind enough to chat about digital strategy and customer behaviors, and the ways that Jet.com handles its competition.
We are constantly told that millennials are breaking the workplace rules. They refuse to work 9 to 5. They demand iPhones. They can’t work unless there’s a fridge full of beer and a pool table in the office. And with a growing war for digital talent, many digital leaders are setting their sights firmly on attracting the digital generation to their firms.
But a recent IBM study suggests an even more interesting conclusion. While the study largely agrees with every other conclusion on the desires of the millennial workforce, it also strongly pointed out that it’s not just “youngsters” that want autonomy, flexibility, empowerment, an awesome work environment that ignites their creativity and the feeling that what they do makes a difference.
It’s the Tools and technology chapter, which has been an absolute beast of a research project. After all, where do you start outlining all of the tools and technologies you need to transform your business to become truly digital? To digitize your business strategy?
The short answer is you don’t.
In most of our research for the Digital Business Transformation Playbook we’ve concentrated on finding and outlining best practice examples of traditional firms that are transforming to embed digital into the heart of their business strategy. As one of our Research Directors so rightly pointed out early in this research, “horses don’t like stories about unicorns”. It’s not so helpful for us to tell you “hey, just copy Amazon” when you run a retail bank with a chain of a thousand branches around the world.
But in this instance we do need to hunt for unicorns.
Because the unicorns are nailing it.
Firms like Amazon, eBay or Spotify manage digital technology on the massive scale, yet retain a high level of innovation and agility. So what sets them and other digital masters, apart from digital dinosaurs in their relationship to technology? What can we learn from how they plan, manage and invest in technology? What we found was:
It’s no great shocker that digital skills are in short supply.
In our annual organizational and staffing survey of eBusiness and channel strategy professionals, we found that while eBusiness budgets have grown by more than 10%, finding the skills and capabilities to execute on a digital strategy is becoming harder and harder.
Digital transformation is undeniably complex and often misunderstood. To look at why things go wrong for some firms, lets take a quick look at three high-profile examples of transformation - two failures and one new initiative. These highlight some common mistakes that senior executives make:
By here, I mean here in Europe. And it’s here to stay.
Amazon launched Europe’s first Black Friday sale in 2010, with a small fanfare and some success. Most European retailers did the polite thing, and looked bashfully away while their brash American cousins celebrated a day with zero cultural significance this side of the Atlantic. “We’ll wait for Boxing Day” was the overwhelming sentiment.
But consumers bit, and the following year a small handful of global brands like Apple and Walmart (in the form of its UK subsidiary Asda) followed suit. Black Friday grew somewhat organically.
But 2014 was different.
Previous Black Friday successes unleashed a literal tidal wave of copy-cats in the run up to Christmas last year. This was most publically a UK phenomenon, with well-known brands like John Lewis taking part, but don’t fool yourself into thinking it was just a quaintly British emulation of the American trend. French and German retailers like Darty and Saturn also indulged. Akamai saw triple the normal web traffic to retail websites across Europe on Black Friday. But it was the UK that bore the brunt of the impact as:
High profile websites buckled and crashed under unprecedented load, with many retailers reporting upwards of a 300% uplift in traffic on Black Friday.