Is Digital Business Really Just Bits, Bytes, and Buying?

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“Becoming a digital business changes how a company interacts with its customers, but it also requires companies to break down old operating silos and bring in new expertise,” according to an March 18, 2013 article in InformationWeek, Goodbye IT, Hello Digital Business.

Pick up a sledge hammer and start swinging! The slurry of concrete and stone we just poured to support Sales2.0 and SocialCRM has hardened quickly. Now, we’re told, it’s in the way. Oh—your IT person might not be up to the task. Something about an old rotator cuff injury.

It’s déjà vu all over again! Break down silos! Bring in the experts! . . . where have I heard this before? . . . So let’s rip and replace—it’s de rigueur in IT. I mean digital business—whatever. Same thing.

After you have pounded your ossified corporate silos into mounds of rubble, you can celebrate your achievement by inviting your CIO on a sales call. Just a few years ago, that visage might seem ludicrous. Today, the idea found its way onto a survey in the form of a dead-serious question: According to InformationWeek‘s February, 2013 survey of 118 senior IT executives, “. . . 23% regularly visit customers . . .” And 20% said “engage customers in new ways” is a top IT priority, up from 13% just one year ago.

For selling, how did information become so important so fast? Through the convergence of mobile technology, sophisticated online search, new content, and analytics. More to the point, buyers have changed habits, and vendors want to exploit their own rapidly improving information advantage.

Consider an insight from industrial manufacturer Brady Corporation, which had $1.3 billion in revenue last year. Brady’s in-house survey found that while 90% of their US and UK customers preferred the Web as a starting point for a purchase, most didn’t use the company’s online resources. “Marketing said, ‘We need more out of IT. We need the engine to go faster,'” according to Brady CIO Bentley Curran. So he got busy creating digital “customer journey maps” to simulate current and future needs. Not surprisingly, Curran has just taken a second title, VP of Digital Business.

At Brady, “teams from IT, marketing and other areas are looking at the first 60 days of a new customer’s experience to map out every interaction and whether the technology supports it well.” “We’ve got to be a customer-facing IT organization,” Curran says. Where I’m from, we just call that Outside-in Customer Centricity.

Brady’s been around since 1914, when corsets and buggy whips were hot items. Good to know the old boy has some youthful digital sales mojo. The company isn’t alone. Some once-staid retailers are meticulously monitoring the 1’s and 0’s coursing through their IT networks, and they have heard the unmistakable jingling of serious coin. Walgreen’s found that customers using multiple channels—including mobile, Web, and in-store—spend up to six times more than those who shop in stores only. And True Value learned that online shoppers will triple their spending if they visit the store. “Enjoy free shipping to your participating store,” the company website cheerily proclaims. Cha-ching!

“Look, Ma, no catalog!” One of Brady’s mobile applications “again shows the blurring of new and old sales channels. A customer can order a product just by snapping a picture of it, and the app sends that picture to a Brady call center rep who can quickly find and order it,” according to InformationWeek. Blurred channels are the same reason that Macy’s no longer tracks online sales as a separate revenue stream. “It’s getting so hard to know what’s a store sale and what’s a mobile sale and what’s Internet . . . sometimes, it’s being bought on a mobile device sitting in a store. So I’m not sure how to define that,” Macy’s CFO Karen Hoguet said at a meeting of securities analysts in February.

The emergence of customer-facing technology has upended a long-held ethos for IT executives: standardization and sameness—what propelled businesses to adopt ERP in the 1990’s. Digital business is different. When IT, marketing, and sales merge, differentiating the experiences that a vendor provides, and making them valuable to customers becomes paramount, and that’s not an easy transition for some IT executives to make. And there are other risks. Robert Urwiler, CIO of Vail Resorts, said that “customer-facing apps face a much higher standard of performance and style than employee-facing apps.” Abhi Dhar, CTO of Walgreen’s agrees. There’s “an obligation [for employees] to use your software . . . there’s something very different when there’s no obligation to use your software.”

Is digital business really just bits, bytes, and buying? I think it’s more. According to InformationWeek, “When we asked in our survey what the main opportunity for CIO’s is, 32%–the largest single percentage—cited using customer or business data to influence new products and drive growth. That’s up eight points over last year, when the answer ranked second after driving company-wide process innovation.”

“Think outside the box.” Many people say that. “Look outside the box”—that’s the new message I gleaned from the InformationWeek article, and it’s a healthy one for IT executives. It’s early to say whether that’s transformational, but it could be . . .

Republished with author's permission from original post.

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