Digital Strategy – Have the Courage to be more Radical
“First there was the physical watch on the wrist – informatization. Then came the digital watch with a display – digitization. Today, we are at digital transformation with the smart watch: a multifunctional device where reading the time is almost the smallest benefit. The watch measures the pulse, plays music, receives messages and much more,” says Nino Tomasone. He is the owner and chairman of the board of Digital Impulse AG – a consulting firm for digitalization topics and an alumnus of the CAS Board of Directors at Rochester-Bern. With the watch example, he shows how strongly the digital transformation can change an industry and open new opportunities.
Today, more than ever, technological innovation is at the heart of everything a business does. “If your company can no longer send emails, it’s pretty much at a standstill. If the accounting software fails, invoices may not be able to be created and delivered to customers. A company without a website and that is not visible on Google is basically non-existent in the digital space,” Tomasone said. Despite this, SMEs pay not enough attention to this topic, and only about half of SMEs have a digital strategy*. Yet digital transformation is a cross-cutting issue that needs a strategy.
Corporate Strategy and Digital Transformation
Whether a company should create a separate digital strategy, integrate it into the corporate strategy or add it to the IT strategy depends on the size of the company and the industry. As a general rule, smaller companies are more likely to anchor digital in the corporate strategy, while the majority of larger companies have a separate digital strategy. It is important that companies address the topic in its full breadth, paying particular attention to the following five points:
- Customer focus & environment: The first thing a company should do is know its customers. The company must know what their needs are and how they move in the digital space. Environmental analysis, market analysis and competitor analysis also belong in this point.
- Products & services: Are the products and services aligned with the customers? What added value do they bring to customers and their end customers? And are the products or services up to date in terms of digitization or how could they be further developed with the support of digital technologies?
- Sales, marketing & branding: This area must also be geared to customers. In addition, digital technologies should be used optimally, and the various channels need to be coordinated with each other.
- The interior of the company: This point involves analysing how the company is structured and to what extent the processes are optimized and digitized. The working conditions also belong in this area: What degree of freedom do the employees have? What is the management style like? What is the corporate culture? These are important points, especially in view of the shortage of skilled workers.
- Corporate IT: IT should provide a good user experience for customers and employees, and be fast, simple and secure: Performance, cyber security and data protection. It is also important that companies are prepared to regularly scrutinize existing IT infrastructures and adapt them as necessary. Questions such as: “Is our IT partner still the right one in view of the current size of the company, the initial situation and the company’s objectives?” belong to this point.
Dare to Make Big Changes
“Have the courage to also incorporate certain radical ideas into the strategy and not just tackle small further development steps. We often see companies, such as the well-known American tech giants and unicorns, suddenly turning entire industries upside down. To do this, you need the courage to have big ideas and strive for the changes that come with them,” Tomasone says as an additional tip for creating a digital strategy and implementing it. Examples of disruptive change include the shift from physical recorded music to streaming music services, or the shift from cell phones to smartphones. All these disruptive innovations came about because someone had the courage to turn a radical idea into reality with a targeted new strategy. Countless more such disruptions will take place in the next few years as part of the digital transformation.
When implementing strategy, companies can work with proof of concepts (PoC), prototypes and minimum viable products (MVP), and pilot testing. “You can start small and test a new product in a minimum viable version or a new service for the first time with a long-standing customer. This allows the customer to be involved in developing the product. Your company, in turn, can learn more quickly from the user feedback and avoid undesirable developments as early as possible,” explains Tomasone. In other words: think big about ideas for the first time and then implement and test them in small, targeted steps.
Recognizing Trends and Building a Network
One of the difficulties of digital transformation is recognizing the direction in which technological innovations are developing. With his company Digital Impulse AG, Tomasone has an established partner network and thus contacts with companies that are experts in specific areas of digital technologies. He and his employees deal with digital trends on a daily basis. “The flood of information on this is huge. It takes quite a bit of time to deal with it, and a certain amount of caution is also always required: It is important to distinguish whether something is just being hyped, partly out of self-interest, or whether it is really a realistic forecast,” says Tomasone. Accordingly, it is also important to take a close look at the sources of each report.
A good partner ecosystem is an important component of Digital Impulse AG. “As a consulting firm with the general contractor function, we are a competent partner in the digital transformation when it comes to analysis, strategy work and implementation. In doing so, we draw on broad experience and maintain a large partner network in the digitalization/ICT environment. Due to the thematic breadth of digitization, we rely on specialists from different technology or specialist areas that we can call on as needed,” says Tomasone. In this respect, the advanced training CAS Board of Directors at Rochester-Bern, which he completed in 2016, has helped him. He still draws on contents of the continuing education and the network he gained helped him to get in contact with partner companies he is working with. Studying at Rochester-Bern has encouraged and helped him in starting his business. For example, it led him to form a corporation rather than a limited liability company. Much of what he learned in the course at Rochester-Bern can therefore be applied one-to-one in his role as Chairman of the Board of Directors.
Looking to the Future
According to Tomasone, artificial intelligence will be an increasingly dominant topic that will also occupy SMEs in one form or another. Although SMEs may not even recognize certain changes brought about by artificial intelligence as such for the first time. For example, a website that is automatically translated into another language is already largely based on artificial intelligence, without users noticing this at first glance. He sees another trend in digital marketing; in this respect, social media, the presence on Google and possibly also in the so-called metaverse will become even more important. In addition, data is also becoming increasingly important (keyword “data-driven business”), based on which SMEs can make more informed decisions. “SMEs will increasingly have to learn how to access the data relevant to their business and use it as effectively as possible in order to keep up with the competition,” says Tomasone. There is still a lot to do in the context of digital transformation. Continuing education, such as Rochester-Bern’s Programs, and external consulting services, such as those offered by Digital Impulse AG, can help SMEs stay up to date and successfully lead the company into the (digital) future.
* Source: Research results on strategy development in the digital age
