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Disrupt With Digitization

Sven Denecken

Innovation requires reimagined processes – and the CIO needs to lead this transformation.

Enterprises today must be prepared for the transformation that the digital economy is forcing upon them.

Now, you might think, “Another digital buzzword article.” Well, yes, some dismiss it as a buzzword, but the challenge for many has just started. But let’s not look at only the problems; there are opportunities if seized right – and you can win big.

For example, competing for new business, or even exploring a new revenue stream by creating a new business model, are things you need to look out for constantly – and for sure you can learn from startups, because that is what they do: challenge the status quo. In a fast-moving digital economy, the window to capture these opportunities closes quickly; companies that are unprepared to pounce when occasions arise will likely get stuck on the road to irrelevance. In my job as product manager, my team constantly screens such opportunities, as innovation needs to be weighted fast and implemented via co-innovation even faster if there is a chance of success – and it must also be adapted fast if reality kicks in.

Successful companies need to be willing to change: They must assess whether they are truly in a position to reinvent business processes every day, not just every generation. And here is where the modern CIO comes in. Yes, digital officers arise at every corner of every industry, and they are needed ambassadors or agents of change. But today I think we should be clear: If every company will soon be a “software” company (which I very much believe, as data will rule the world) you need a modern chief information (and innovation) officer to help business and the company board of directors to make this change happen.

Here are 3 key lessons we have learned from the CIOs we constantly speak with during our co-innovation work. (Of course, there are also many lessons we learn from CIOs who are not embracing it – but will they still be CIO next year?)

Lesson #1: Four trends to check if you are on track

As I stated earlier, there are four inescapable trends are creating the pressures that shape today’s digital transformation:

  • The empowered customer: Whether your customers are Generation Z consumers or multi-national conglomerates, they all share one vitally important characteristic: Each demands to be treated as a unique segment of one. You have no choice but to meet that expectation.
  • Competitive and regulatory pressures: Transparency is a necessary part of business today, and that means competitors and regulators alike can dissect any business process. Staying ahead of the former and meeting the standards of the latter requires operational excellence and accountability at every step in the value cycle.
  • Globalization: More businesses today must be prepared to go global in order to remain relevant. Expanding into new markets can no longer be done effectively with costly, infrastructure-heavy international build-outs. Enterprises need a pay-as-you-go strategy with scalable capacity, which can be adjusted rapidly to meet market conditions in any region.
  • Technological progress: The tide of innovations and discoveries is unrelenting. Businesses must be agile enough to quickly adopt new strategies, and be steered by insightful, knowledgeable leadership that can sort winning inventions from dead-end novelties.

Lesson #2: Unprecedented levels of business agility

The need for an unprecedented level of business agility to match the rapid pace of innovation and transformation present in business is not restricted to a particular industry. Rather, we see entire markets, including transportation, logistics, and e-commerce, being reinvented on a seemingly daily basis. For any industry in which the production, shipment, and transaction of a product is still relevant, transformation supported by digitization is fast becoming a necessity.

Pressures to reshape the business using a digital template are likewise common across the industry spectrum. Companies — both in the business-to-business (B2B) and business-to-consumer (B2C) worlds — expect personalized interactions as a “segment of one,” which necessitates individualization of products and services, and freedom of choice. The business has no choice but to meet these demands — on the platform the customer chooses — or risk losing customers to a competitor.

The common solution that addresses these pressures is agility, and the way to achieve that agility is with a flexible, digital core at the heart of every organization that can meet the demands presented by increasing across-the-board disruption.

In my presentations I often state why we need to talk about a digital core: As long as something is produced (even if it is a service), as long as something is delivered or shipped, and as long as something will be paid – there is a need for a core. It is as simple as that. Every CIO surely knows that end-to-end processes often start at the edges or with systems of engagement, but they are of limited value if they do not connect with the core – the heart that makes your company run.

Now building on top of this, with a digital core, organizations can do far more than simply meet these pressures at a minimum level of success. They can pivot in near real time to capitalize on innovations in areas such as cloud, Big Data, and business network connectivity to completely transform the business, whether it’s to keep up with the growing influence of emerging topics such as the Internet of Things (IoT), 3D printing, or augmented reality, or to defend against new competitors launching up all around them.

A digital core is an enabling platform for transformation and innovation, but what are its hallmarks? We find five key characteristics that make up a digital core:

  1. A digital core provides the enterprise with the capability to drive and anticipate business outcomes in real time.
  2.  It integrates the business seamlessly across all value chain processes such as client interaction, administration, production, and research and development.
  3.  The digital core increases efficiency by automating processes and distributing responsibility for customer insights across an intelligent business network.
  4. It increases effectiveness by converting signals in business data into tangible action, essentially bringing Big Data to the size and scale needed to turn insight into action for the everyday user.
  5. The digital core increases enterprise agility by elevating each employee’s view of the organization.

So how can the modern CIO help to disrupt with digitization?

Here is the modern CIO’s plan for success: They prioritize day-to-day operations that were formerly siloed lines of business to have complete visibility into the entire core business of the enterprise. Finance, sales, and manufacturing can then act in concert, basing decisions on the same information in real time. This is where the company wins big, and this is how the modern CIO will drive change for the better and help their company win in the digital economy.

Successful CIOs know that the race to digitization is on. Until recently, many of the clients I spoke with were still questioning the need for digitizing the enterprise. Now, they want to know the most efficient route to get there. And while SAP’s digital core S/4HANA Enterprise Management is certainly a monumental milestone, clients are surprised to discover that arriving at a digital core is not as difficult as it might seem to enable this level of transformation.

A digital core helps any business run faster and simpler, so getting there should not be as complicated as the siloed line-of-business applications and redundancies a business leaves behind.

Want more insight on digitization? See The Digitized Core At The Heart Of Reimagined Business.

Looking forward to your feedback! Follow me for the latest updates: @SDenecken (link to Twitter account).

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Sven Denecken

About Sven Denecken

Sven Denecken is Senior Vice President, Product Management and Co-Innovation of SAP S/4HANA, at SAP. His experience working with customers and partners for decades and networking with the SAP field organization and industry analysts allows him to bring client issues and challenges directly into the solution development process, ensuring that next-generation software solutions address customer requirements to focus on business outcome and help customers gain competitive advantage. Connect with Sven on Twitter @SDenecken or e-mail at sven.denecken@sap.com.

Digitalization Offers CIOs New Opportunity To Lead

Savita Raina

Digitalization is the single most talked-about topic among business leaders at all tech and non-tech companies—including small, midsized, and large companies, in all industries and all lines of businesses. Why?

The reason is very simple: Digitalization is converging all technologies, from cloud-based IT, mobile, and the Internet of Things (IoT) to Big Data. Digitalization is driving the next digital revolution and leading to a new wave of productivity.

Old business models are being shattered, with disruption driving new innovation, new ways of thinking through problems, and new solutions.

Let’s take a look at some of the implications this disruption is bringing.

The demise of old business models—and the birth of new ones

Uber and Airbnb are two well-known companies that are already riding the digital transformation disruption wave. With only access to handheld smartphones, every car owner or homeowner today can provide a service by sharing their car or home to generate revenue. Both are perfect examples of how disruptive digital business models are paving the way for revenue generation, great customer service delivery, and consumer value. Both are eroding the business of traditional service providers such as taxis and hotels.

In the automotive industry, connected cars are another form of digital disruption. As consumers expect and demand to be constantly connected, new players are entering the automotive market. Software companies, financial institutions such as credit card companies, and telecommunication companies are transforming the industry and changing its landscape. Automotive companies must either share their profits with these new entrants, build solid internal capabilities to challenge them, or collaborate with them quickly and strategically to create the value today’s consumer demands.

Every company is a tech company

In previous years, there has been a clear distinction between what tech companies and non-tech companies do. But with access to supercomputing and aligned technologies such as Big Data, mobile, deep data analytics, and cheap commodity hardware, non-tech companies can now leverage data to make more informed business decisions. With access to historic and real-time data, companies can upsell and cross-sell to customers and use data to deliver better customer service.

Retail giants such as Walmart, Caterpillar, and many other traditional non-tech companies are becoming tech companies as they sit on tons of data, which they can leverage to build business and provide added value to customers. Without the digital revolution, leveraging data to extend business capabilities would have been impossible.

Data privacy: a major concern

Recent data breaches at government institutions such as the FBI, retail giants such as Target, and electronics and media companies such as Sony are raising concerns. So, too, is increasing governing agency oversight on the day-to-day lives of American citizens. This changing environment makes companies and individuals rethink their data privacy approaches.

With every aspect of our lives digitalized, there are major concerns that our precious personal data could be misused by authorized or unauthorized entities. It has become more and more important for businesses, government agencies, and non-profit institutions to safeguard and secure the personal data of individuals from unwarranted harassment and violations of personal freedoms and liberties.

While digitalizing aspects of their lives has advantages for many people, the risk of data misuse will continue to be a major concern.

CIOs can lead by driving change

With all the possible implications of digitalization and the digital revolution, CIOs can play a key role in driving change by smoothing this transition for their organizations. As technology experts with sound understating of information systems and business processes, CIOs can lead the way by collaborating with other C-suite executives in understanding their needs and translating those needs into business outcomes that can add new capabilities and impact enterprise-wide competitiveness.

By participating actively in driving this enterprise-wide change, CIOs can help build new business models for tech and non-tech companies alike. By collaborating and working hand-in-hand with other C-suite executives, CIOs can diffuse the conflict created by departmental silos and differences in departmental objectives.

With a focus on data security, privacy, and data stewardship, CIOs can pave the way for new-age enterprises that leverage data to deliver great customer value and improve the bottom line.

Click here to learn more about digitalizing IT.

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Savita Raina

About Savita Raina

Savita Raina is a Senior Marketing Project Consultant and Manager of Global Audience Marketing at SAP. She is responsible for defining and delivering solution and audience messaging, value prop, content strategy and development, & performance monetization for SAP core technology portfolio : SAP HANA Platform, Analytics, Cloud platform and S/4 HANA business suite.

Technology Should Support Digital Transformation, Not Define It

Dwight Davis

Upstart visionaries ranging from Uber to Airbnb to Netflix have achieved stunning success by blending cutting-edge technical capabilities with innovative business models. In most cases, their success has come at the expense of established industry players who were blindsided by these emerging competitive threats. Faced with the possibility of being victimized by new digitally driven disruptors, companies are scrambling to “reinvent” their own business strategies and processes before someone else beats them to the punch.

These proactive efforts are typically proceeding under the banner of “digital transformation,” and often focus on exploiting so-called “third-platform” technologies. Most notably, these technologies include mobile devices, cloud computing, social networking, and Big Data analytics. And indeed, the companies now changing the rules of engagement within different industry sectors are each using some combination of these digital tools and platforms.

Unfortunately, in response to these threats, some companies are placing themselves at risk by putting the technological cart in front of the business-case horse. It’s easy to get so swept up in the features and capabilities of, say, mobile devices or Big Data analytics, that you neglect to focus first on the specific opportunities, challenges, and requirements your company faces.

Determining the best course of action involves many variables, including those that are unique to each company and market sector. Still, there are common, business-driven considerations that every company should explore. One approach to digital transformation, promoted by SAP, involves addressing five key pillars:

  1. Customer experience: What do customers expect when interacting with your company across all channels (web, social, phone, in-store, etc.), and how can you improve their experience in each?
  1. Supplier collaboration: Which suppliers do you need to work with, and how do you most effectively interact with them to deliver your products and services and also optimize your own operations?
  1. Core business processes: What are your most-critical business processes within each sphere of operations (e.g. finance, manufacturing, R&D, sales…), and how might you enhance or replace those processes?
  1. Workforce engagement: What tools, support and incentives do your employees expect and require to be both effective and enthusiastic when performing their jobs?
  1. Assets and the Internet of Things: What digital assets and information sources do you have, and which can you develop, to drive real-time insights and help create new business models?

Clearly, addressing each of these digital transformation pillars requires you to leverage a variety of technological tools. But it’s important to fit the tools to the needs and opportunities identified when exploring the five categories above, rather than allowing the capabilities of the tools themselves to set the business-strategy agenda.

That said, you must fully understand the depth and breadth of third-platform functionality in order to identify the ways in which you – or your competitors – may upend the status quo. You are also likely to face some hard choices when it comes to writing off some existing IT investments sooner rather than later. One of the biggest drags on digital transformation is the presence of unnecessary complexity throughout the IT infrastructure. To most effectively exploit advanced technological platforms and the new business models they permit, you may need to make a clean break from inflexible and fragmented legacy systems that were designed to support the old way of doing business.

For more insight on digital transformation, see How To Develop A More Effective Digital Transformation Strategy.

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Dwight Davis

About Dwight Davis

Dwight Davis has reported on and analyzed computer and communications industry trends, technologies, and strategies for more than 35 years. He worked as a senior editor at several leading computer and business publications from the late 1970s through the mid-1990s. Dwight then took the helm of Windows Watcher, an award-winning corporate newsletter focused on Microsoft and its ecosystem of partners and competitors. Next, Dwight spent 10 years working as a leading industry analyst, first at Summit Strategies and then at Ovum. At these market-research firms, he ran a variety of infrastructure software strategic services. Those services tracked and analyzed leading vendors (Microsoft, IBM, Oracle, SAP, HP, Sun, etc.) and innovative start-up firms, as well as cutting-edge technologies and business models. His areas of expertise include cloud computing, service-oriented architecture, cybersecurity, mobile computing, and Web services. Since 2009, Dwight has worked as an independent analyst and writer.

Customer Experience: OmniChannel. OmniNow. OmniWow.

Jamie Anderson, Volker Hildebrand, Lori Mitchell-Keller, and Stephanie Overby

The lines between the digital and physical customer experience today are largely artificial. Customers shop in retail stores with their devices at the ready. They expect online-like personalization and recommendations in the aisles. They’re looking for instant gratification and better sensory experiences from digital channels. It’s an omnichannel world and companies must figure out how to live in it: delivering a superior customer experience regardless of the entry point.

Luxury fashion brand Rebecca Minkoff, for example, opened its first three retail stores with the intent of taking customers’ best online experiences and bringing them to life. “In the past, you had this brick-and-mortar experience, and you had the online experience,” says company president Uri Minkoff. “There were such great advantages and efficiencies that emerged with shopping online. You could get recommendations, see how something should be styled, create wish lists, access user-generated content. In the store, it was still just you and the product, and maybe a sales associate. But [unlike online] you had all five of your senses.”

Rebecca Minkoff’s new stores still stimulate those senses while incorporating some of the intelligence that online channels typically bring to bear. Each store features a large interactive screen at the entrance, where customers can browse products or order a beverage. Shoppers can interact with salespeople or they can make purchases on a mobile app without ever talking to a soul. Inside a fitting room, RFID-tagged merchandise is displayed on an interactive mirror, where customers can request new sizes or the designer’s recommended coordinates (a real-life recommendation engine).

The company has found that 30% of women ask for additional items based on the recommendations. It has also sold three times more of its new ready-to-wear line than it anticipated. “We were an accessories-dominant brand,” says Minkoff. “But we’ve been able to build this direct relationship with our customers, helping them with outfit completers and also getting a better sense of what they want based on what’s actually happening in our fitting rooms.”

Each piece of technology adds to the experience while capturing the details. Rebecca Minkoff’s integrated systems can remember a customer’s previous visits and preferred colors and sizes, and can enable associates to set up a fitting room with appropriate garments. On the back end, the company gets the kind of visibility into in-store conversions once possible only in digital transactions. “The technology gives us the ability to create the kind of experience each customer wants. She can shop anonymously or be treated like a VIP,” says Minkoff.

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Build Around a Big Idea

Rebecca Minkoff’s approach is a bellwether. It’s not enough simply to provide continuity or consistency from one channel to another. Customers don’t think in terms of channels, and neither should companies. Rather, it’s about defining the overarching experience you want to deliver to customers and then building the appropriate offline and online elements to achieve that intended outcome.

As more goods and even services are commoditized, companies must compete on the experiences they create (see The ROI of Customer Experience). That means coming up with a big idea that drives the design of the customer experience. “Every great experience needs to have a theme,” says Joe Pine, consultant and coauthor of The Experience Economy and Infinite Possibility: Creating Customer Value on the Digital Frontier. “That’s the organizing principle of the experience. It’s how you decide what’s in and what’s out.”

For example, Rebecca Minkoff serves as an image consultant to its Millennial customers, who expect personalization, recognition, and tech innovation, using a mix of online and offline techniques. To stand apart, companies must come up with their own unifying idea and then integrate data and systems, rework organizational models, and rethink key strategic metrics and employee incentives in order to integrate the physical and digital worlds around that idea.

Here are some examples of companies that have created a theme-driven experience using online and offline elements.

Nespresso: Imparting a Sense of Luxury

At the most basic level, Nespresso is a manufacturer of coffee and coffee machines. But the company has successfully turned what it sells and how it sells it into a very specific type of experience. Nespresso strives to impart a feeling of quality, exclusivity, even luxury in a host of ways.

sap_Q316_digital_double_feature3_images2The company has created the Nespresso Club, which maintains direct relationships with thousands of customers. Its customer service centers are staffed by 1,000 highly trained coffee experts who don’t just push products but offer advice and guidance as a sommelier might do with wine. Its 450 retail stores (up from just one Parisian in 2000) are called boutiques; the largely inventory-free showrooms are built around tasting and learning.

Online, the focus is on efficiency and service. Customers who prefer digital interactions can order through the web site or mobile app, which offers the option of courier delivery within a two-hour window. The company also recently introduced a Bluetooth-enabled coffee machine, which when paired with a smartphone app, can track a customer’s usage, simplify machine maintenance, and as Wired pointed out, enable remote brewing.

Success didn’t happen overnight, but today Nespresso is one of Nestlé’s fastest growing and most profitable brands, according to Bloomberg.

QVC: Using Online to Complement the Experience

The theme that has driven television-shopping giant QVC’s customer experience for decades has been “inspiration and entertainment.” Traditionally that was delivered through the joy of spontaneous discovery while watching the channel.

Matching that experience online has been difficult, however. At a digital retail conference in 2015, QVC’s CEO explained that in the past the company had failed to deliver the same rich interactions online that it had developed with its TV audiences, according to Total Retail. So the company decided to rethink its use of digital tools to focus on complementing the experience it delivers through TV screens, according to RetailWire.

For example, after enticing TV viewers with products, QVC introduces the next step in the buying journey—“impulse to buy”—in which viewers are spurred on with televised countdown clocks or limited merchandise availability. Online, the company has been experimenting with second-screen content (for instance, recipes that compliment a cooking product being sold on TV) to further propel purchases. The QVC app features the same item that is on-air along with a prompt that reveals all the items featured on TV in recent hours. On Apple devices equipped with Touch ID, customers can check out in less than 10 seconds with the fingerprint-enabled “speed buy” button. The third phase—“purchase and receive”—is complemented by a simple and reliable online browsing and purchasing platform. The last stage—“own and enjoy”—is accompanied by follow-on e-mail communication with tips on how to use products.

Last year, the company reported that 44% of total QVC sales came from online channels (up from 40% in 2014), and nearly half of those were completed on a mobile device. In fact, QVC is currently the tenth largest mobile commerce retailer in the United States, according to Internet Retailer.

Domino’s: Focusing on Speed and Convenience

sap_Q316_digital_double_feature3_images3Domino’s Pizza built a fast-food empire not necessarily on the quality of its pies but instead on the experience of getting hot food delivered quickly. What started out as a promise to deliver a pizza within 30 minutes to customers who phoned in their order is now a themed experience of efficient food delivery that can be fulfilled a number of ways. Domino’s AnyWare project enables customers to order pizzas from their TV, their Twitter account, their smartwatch, or their connected car, for starters. The Domino’s app features zero-click ordering functionality: Domino’s will start fulfilling the usual order for customers who opt in 10 seconds after opening the app.

Domino’s Australian stores are piloting GPS tracking whereby employees begin working on an order only when the customer enters the “cook zone”—a dynamically updated area around a given store that results in the customer arriving to a just-prepared order. The tool builds upon previously developed GPS-based technology for tracking delivery drivers, according to ZDNet. And the company that came up with the corrugated pizza box and the Heatwave Bag to keep pies warm is now building the DXP—a delivery car with a built-in warming oven. All in the name of the fast- and hot-food delivery experience.

Mohawk Industries: Using Social to Streamline Customer Interactions

Mohawk Industries grew to become a US$8 billion flooring manufacturer by relying on customers to visit its dealers’ retail locations to see, touch, and feel the carpet, hardwood, laminate, or tile they planned to purchase.

sap_Q316_digital_double_feature3_images4Today, instead of waiting for customers to find Mohawk, it has redesigned its experience to find them. It has adopted new technology and reworked its sales processes to reflect that new focus. The company’s 1,200 sales representatives have access to a 360-degree view of each customer, complete with analytics and sales tools on their tablets, enabling them to capture and follow through on leads generated through social media engagement.

By analyzing online discussions in real time, representatives can jump into the conversation and help customers find the product they may be searching for and direct the consumer to a retailer to finish the sale. In one episode, a woman was posting about her interest in a particular leopard rug on Twitter. Mohawk’s team surfaced the tweet, passed it on to a channel partner who contacted the woman and closed the sale within two minutes. Today, the company boasts an 80% close rate on sales started and guided in social media and has made $8 million on 14,000 such social leads. Mohawk Industries expects an increase of $25 million in sales year-over-year, thanks to its new customer-centric approach.

Customer Experience Design: Where to Begin

Developing a unique, valuable, and relevant customer experience that combines the best of offline and online capabilities is a huge undertaking. All corporate functions, including marketing, customer service, sales, operations, finance, and HR as well as product or business lines—all of which typically have competing metrics and agendas—must buy into the experience and collaborate to make it happen. And the ideal mix of digital and physical components will vary by company. But there are some best practices to get companies started on their own journeys.

Start at the Top

Without leadership buy-in, changes will not happen. “Customer experience is not a feature, it’s not a shiny button. It’s a concept that sometimes is tough to grasp. But we believe that if done right, it will keep customers loyal. And so we put a lot of effort into it,” says Kevin Scanlon, director of total customer experience at tech company EMC. “That’s why having that top-down support is paramount. If you don’t have it, you’re spinning your wheels. It’s going to give you the resources, the focus, and the attention that you need to design that consistent experience.”

To demonstrate its commitment, every VP and above at EMC has a customer experience metric as part of their quarterly goal.

Begin with the End in Mind

Companies can take a page from the design-thinking approach to product development, starting with the experience they want customers to have with their company and then putting in place the people, processes, and systems to make that happen across various touchpoints. Uber didn’t start by buying 1,000 cars. It started with a completely new customer experience it wanted to deliver—straddling the digital and physical—and then built the organization around that. Uber ultimately leveraged people, process, and technology to bring that to life, but it started with a unique customer journey.

Design for the Customer, Not the Company

sap_Q316_digital_double_feature3_images5To date, most corporate processes have been designed for internal efficiency or cost savings with little consideration for the impact on the customer. Companies that want to design for consistent experiences have to reexamine those business processes from the customer perspective. In order to deliver a standout and consistent experience, enterprises must bring together an assortment of data from a variety of systems—including POS transactions, mobile purchases, call center activity, notes from sales calls, and social media.

The average retailer has customer data in more than a dozen different systems. But it’s not just the front-end customer-facing systems that need orchestrating; back office systems and processes, from your supply chain to fulfillment to customer service, must be designed to deliver the intended experience. For example, Nespresso has to orchestrate a number of back-end and front-end systems to offer customers premium courier delivery within two-hour windows.

Put Someone in Charge

Companies that are truly invested in creating integrated, standout customer experiences often create a centralized function that can bring together the people, processes, and technology to bring them to life. Sometimes there is a chief customer officer or head of customer experience. But unless these people are really empowered, they’re toothless.

EMC’s Scanlon is empowered. He heads up a function that has been transformed from focusing on product quality into a centralized customer experience center of excellence staffed with 60 full-time professionals. The center has translated into “more focus, more energy, more insight to our customers,” says Scanlon. “And we can deliver that insight to our internal stakeholders, which trickles down to our account teams and lets them have more meaningful conversations that benefit our customers—and benefit the company over time.”

Centralize Customer Data

Even if there is no central customer experience function, there needs to be a central data repository and analytics system: a digital foundation that everyone can use to improve their piece of that experience. EMC’s customer experience group has a data governance function that maintains a single source of customer truth. “They’re able to pull all relevant data sources into one location and get past the typical customer data challenges,” says Scanlon.

Invest in People

Companies that care about the customer experience invest in the people who deliver it. Human beings are the clearest signposts on the customer journey. Companies must hire the best, train for desired outcomes, and reward based on experience metrics: for being brand ambassadors and for going above and beyond on behalf of the customer.

sap_Q316_digital_double_feature3_images6Rethink Metrics and Incentives

One major bank was having trouble driving adoption of its online banking tools. The customers that used the tools loved them, but the tools weren’t getting traction. The problem? The branch managers had no interest in promoting digital banking. They wanted to drive as much traffic as possible to their physical branches because this was one of their key performance metrics.

The solution was to change the compensation approach in order to reward employees for the entire customer experience, including online banking adoption. Branch managers were measured on online and offline customer behavior in their regions. That became a single and critical KPI, and it boosted the desired behaviors and improved overall customer satisfaction.

Create a Single View of the Company

For years, companies have talked about the importance of understanding the customer. And that remains true, particularly when it comes to delivering a valuable customer experience online and off. But successful customer experience design is just as much about giving customers a clear understanding of the company through coordinated experiences that deliver on the brand’s theme and bring it to life in various ways in bricks and mortar, through devices, in online interactions, and everywhere in between. D!

Read more thought provoking articles in the latest issue of the Digitalist Magazine, Executive Quarterly.

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Is The Internet Of Things And Wearable Technology The New Black?

Fred Isbell

The Internet of Things (IoT) is a classic hype cycle phenomenon. Besides forecasts of high growth, it is capturing a large share of interest and overall mindshare.

One thing is clear: The elements of the IoT are here to stay. Once we get past the definition of IoT, which is commonly referred as sensor-based devices and machine-to-machine communications, businesses can open themselves to enormous potential.

When trying to understand new things, I prefer to embrace them as a part of my daily life. When tablets first emerged, I didn’t go anywhere without my trusted iPad. In fact, I sometimes leave my laptop home knowing that I can do most of what I need on this device. And based on that experience, I took my own advice when it came to wearable technology recently – and the results were eye-opening.  I’m now onto my second-generation wearable device, showcasing just how quickly this is all changing.wearable-1

But first let’s jump into the time-travel machine back to February 2015. I was attending the MIT/Sloan School Sports and Analytics conference in Boston, and it seemed that everyone was mentioning wearable technology. The buzz was verified weeks later when I attended the IDC Directions Annual conference, where wearables made the short list of technology ubiquity. A year later, I returned to the MIT/Sloan School Sports and Analytics conference in Boston a little bit wiser. At that point, I invested in a Fitbit and started tracking my own personal statistics for exercise, sleep, and more. Needless to say, the geek in me was in full force as I wore both a Fitbit and a sports watch at the same time. I didn’t want to miss anything, and my middle-aged eyes appreciated the help.

One of the benefits of working for a tech company is the opportunity to adopt new technology in every aspect of my life. My employer, SAP, kicked off a new wellness program, incorporating wearables in how its employees track their health and wellness. I took advantage of this opportunity, replacing my sports watch with a second-generation Fitbit and consolidating two devices into one.

My wearable journey is certainly not complete yet, but it’s become integrated into my life in a very nonintrusive way. Just as my tablet has become an extension of me, so has the wearable device. I even exchange screen shots of my results – such as when I rode my first charity JDRF bike ride over the summer – to friends so we celebrate our achievements.

Very soon, our interactions with the IoT and wearable will become the norm, and we won’t think twice about it. But at the same time, it’s becoming a big business. Market watcher CCS Insight sees this as a US$14 billion market growing to over US$40 billion by 2020. All of these devices will generate even more data, making Big Data bigger than anyone could have predicted.

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All of that data will generate increased demand for applications – especially analytics – to understand, interpret, and use this information. And if you think about it, my Fitbit app on my phone is really a personal business intelligence tool and the ultimate example of the consumerization of IT.

Not surprisingly, tech leaders such as SAP talk about the fusion of business-to-business (B2B) and business- to-consumer (B2B) into what some call “business-to-business-to-consumer” (B2B2C). The proliferation of wearable technology is a great example of this. The market for applications and solutions will increase exponentially – supported by cloud-based delivery and unprecedented demand for the infrastructure to deliver real-time intelligence and much more.

Wearables are indeed the new black as it becomes mainstream and part of society. I’ll come back shortly with a further discussion of how we can apply this technology in sports and analytics. In the interim, I need to head to the gym to get my 10,000 steps and the fitness equivalent to make my Fitbit – and me – happy!

For more on the impact of connected devices, see How Tech Changes Up Health In The Workplace.

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Fred Isbell

About Fred Isbell

Fred Isbell is the Senior Director of SAP Digital Business Services Marketing at SAP. He is an experienced, results- and goal-oriented senior marketing executive with broad and extensive experience & expertise in high technology and marketing. He has a BA from Yale and an MBA from the Duke Fuqua School of Business.