1. Cov 19 accelerates digital transformation
The coronavirus outbreak has changed many things, and caused huge impact in many industries.
When traditional channels and operations are impacted by the outbreak, the value of digital channels, products and operations become immediately obvious.
Organizations that have rebalanced business priorities and technology investment are in a much better position to capture future growth.
Last month, during the leadership meeting, I shared the topic of Traditional business digital transformation, from both angels of external industry key concepts, and internal our China company's readiness.
Covering the below three topics:
1. Four online’s
2. Three shelves
3. Three stages
2. Key Concept 1 - Four "online"
Though Digital can change many things, but ** nature of business remains unchanged.**
A success business includes three factors:
1. Good products and good service.
2. Good content design and marketing.
3. Omni channels to amplify the exposure of good content and reach consumers effectively.
Digital technologies are enabler and accelerator of these three factors.
For traditional businesses to embrace digital era, the first step is to improve organization efficiency via technology.
That is, to start with four "online's".
They are:
1. employee online
2. product online
3. customer online
4. management online.
These four steps are in order and cannot be mixed up.
Many traditional businesses started with product online. It put all the products and services on the Internet and APP, and claimed we have done with the digital transformation.
When it turned out, no online purchase. The company blamed: digital transformation doesn't work for traditional business.
This is because: the sequence is wrong.
First step is to bring your employee online.
Today, everyone has a mobile phone, which enables employee to be online.
When the employee is online, he or she brings his/her customer online, in the wechat moments and private wechat groups.
When both employee and customers are online, the organization can empower the employee with the company's product library and knowledge data base, so that he will have the ability to better serve the customers.
At the same time, you bring the management online to ensure service quality.
3. Key Concept 2 - three shelves
The 2nd key concepts is new retail model.
In the future, all retailers should have three shelves.
First shelf is the traditional physical retail store. This is the critical display shelf. In the future, these offline stores should also assume the function as warehouse covering the nearby community.
The second shelf is the online shelf, on the public e-commerce platform like Tmall and JD. It also include our official website, official wechat account and wechat mini program.
The coverage of second online shelf is wider than the first offline physical shelf. They are supplementing each other.
The third shelf is the social shelf. That is the wechat moments, the private wechat groups of your staff.
When the staff is off work, he still has connection with the customers and still has influence with the customers. He still can sell, via wechat moments and wechat groups.
These three shelves are key to develop and expand the retail business.
4. Digital transformation - three stages
Now let's move to the final topic: three stages of traditional business digital transformations.
Today, organizations rely on data and technology for competitive advantage. But how quickly you can adapt to change limits your ability to exploit digital capabilities.
There are different stages of digital transformation.
The first stage is IT foundation, that is, system, tool, and process.
First step is to build the foundation and automate offline process and workload. This will release the valuable human resource from low value manual work, improve data accuracy and quality, and improve the overall management efficiency.
The second stage is Data foundation. That is, to collect relevant internal and external data, and prepare for the next stage analytical.
Data foundation is based on system and process. It is impossible to build a solid data foundation without solid systems and processes foundation.
The third stage is Data Organization. It's the ability to organize and analyze data, build modelling and dashboard, and get insights to support business decision.
We not only need tools, but also people who is able to use the tools and maximize the value.
Digital business transformation requires people change throughout the enterprise, not just in IT.
All employees and leaders need to change how they work and think about their work to accelerate the organizations’ digital business plans.
Digital business doesn’t just disrupt markets — it disrupts leadership as well.
5. Recap
To re-cap
- For traditional businesses to improve organization efficiency via technology, start with four "online's" in order: employee online - product online - customer online - management online.
- Three shelves in new retailer model: physical shelf, online shelf, and social shelf;
- Both four online‘s and three shelves are to support the business nature, that is: product, content, and channel.
- The three stages of traditional business digital transformation are: to build IT foundation - Data foundation - Data Organization.
- Finally, Digital transformation must be driven from top business leadership team.
6. Is your organization ready to embrace the "New Normal"?
The new coronavirus outbreak has hatched a new buzzword in the Chinese blogosphere: retaliatory consumption, or called "revenge or retaliatory spending".
Different from 2003, when the "retaliatory consumption" only started after the SARS was over; today, the "retaliatory consumption" has already happened.
Today, one billion people in China have mobile phone, have wechat, and have money in the APP. They won't wait till the end of the coronavirus to resume consumption. They are buying now.
This crisis has resulted in a paradigm shift in consumer behavior and be more digital. This change in behavior will become the 'way of life' and 'new normal' for consumers.
Final question for the orgnization: are you ready for the "new normal"？
