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Implementation, change management support, relationship management, customization, solution breadth, SMAC capabilities, pricing flexibility
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Digital adoption refers to the converged use of emerging technology themes to drive efficiencies across back-office and core mid-office business processes, and enhance competitive advantage by impacting market-facing front-office processes
These days it seems as if every enterprise is talking about “going digital,” and service providers are adding to the noise with hyperbolic promises about digital solutions that will re-imagine the workplace as we know it. However, each stakeholder in the ecosystem, from service providers to enterprises, industry shapers to investors, is using a different definition of digital adoption. So in the interest of industry cohesion, we will attempt to bust some prominent myths surrounding digital adoption and offer a workable definition of digital.
Myth 1: Standalone implementation of a single digital technology theme counts as “digital adoption”
The true power of digital adoption is realized when enterprises leverage and integrate a variety of digital technology themes across the enterprise. Putting some data in the cloud or creating a nifty mobile customer interface tool is not digital adoption.
Myth 2: Digital adoption is solely about digital marketing and/or enabling online/mobile channels
While most of the hype around digital services and solutions refers to its use in marketing, the reality is that digital is much more inclusive and pervasive. In fact, our research shows that almost half of North American enterprises are concentrating their digital investment on back- and core mid-office efficiency, rather than market-facing business processes.
Myth 3: Digital is just another name for SMAC
Another myth being perpetuated is what we call “digital-washing,” pulling a bait-and-switch with terms like SMAC (social, mobile, analytics, and cloud) or BYOD (bring your own device). Digital is much more comprehensive than any of these existing terms, encompassing an array of technologies to support and augment digital functionality that touches every aspect of back-,
mid-, and front-office business processes.
Enterprises are spoiled for choices in adopting next-generation solutions and services. Possibly for the first time in history, enterprises are challenged not by the lack of technology, but by its overwhelming abundance.
But that abundance creates its own difficulties. Enterprises that are looking to ride the digital wave to improve operations and grab greater market share need to look at digital solutions with a more holistic view. The greatest benefits of digital solutions come from the development and implementation of a comprehensive digital strategy, not a piecemeal adoption of a particular next-generation technology for a siloed business process.
In other words, digital adoption is the converged use of emerging technology themes to drive efficiencies across back-office and core mid-office business processes, as well as to enhance competitive advantage by impacting market-facing front-office processes.
Let’s focus on two key aspects of this definition.
Digital is about technology convergence: In more than one way, digital adoption perfectly represents the concept “the sum is greater than its parts.” The combination of multiple technology themes ‒ SMAC, Internet of Things (IoT), artificial intelligence (AI), etc.‒ is more powerful in resolving real business challenges than is employing each of them separately.
In other words, enterprises achieve the true power of digital adoption when they develop strategies that leverage and link the benefits of a broad number of digital technology solutions, e.g., engaging analytics using social and mobile data stored on a cloud infrastructure.
Digital adoption encompasses multiple layers of functionality and technology enablers across enterprise value chains and business processes: Our research indicates that enterprises are investing in – and, more importantly, gaining significant value from – digital technology themes across the enterprise value chain and throughout various business processes. Far more than fancy marketing gimmicks, true digital adoption touches nearly every aspect of a business, with use cases ranging from employee engagement to supply chain transformation.
Finally, as the plethora of digital solutions, services, and developments indicates, the opportunities for digital adoption are ever-changing; the range of digital-enabling technologies and corresponding interfaces in the interaction layers is not a static concept, but instead is dynamic in nature. As such, the collection of available technologies across the interaction and enablement layers can change over time, creating new opportunities…and new challenges.
Have you been bitten by the digital bug? Keep your eyes on this space for findings from our soon-to-be-released report, North American Digital Adoption Survey – How pervasive is your digital strategy.
The new technologies sweeping the market hold great promise of competitive advantages. But there’s a disturbing trend occurring in the services sales process for these technologies that poses a risk for buyers. Look out for providers talking about cloud, mobility, big data, the Internet of Things, and social in the same breath as SaaS/BPaas, automation, robotics, and artificial intelligence. Providers that jumble these technologies together as though they are homogeneous really don’t understand the implications of what they’re trying to sell you. They’re basically throwing mud against your wall and seeing what sticks.
The possibilities with all of these technologies are exciting, but they have distinctly different impacts on the buyer’s business.
As illustrated in the diagram below, we can bucket one class of impacts as those that create new business opportunities. They provide new types of services that enterprises can use to change the composition of their customers or provide different kinds of services. For example, the Internet of Things holds enormous promise around allowing enterprises to provide a completely different class of services to their customers. In mobility and social technologies, the digital revolution holds the promise of changing the way businesses interact with their end customers.
The second class of new technologies (Saas/BPaaS, automation, robotics, and artificial intelligence) changes how services are delivered. For example, SaaS takes a functionality that was available but delivers it through a different mechanism. Automation and robotics changes the way service is provided by shifting from FTE-based models into an automated machine-based delivery vehicle.
The two buckets of technologies have different value propositions. The first class of technologies (cloud, mobility, big data, IoT, and social) are about getting new and different functionality. The impacts in the second class are lower costs and improved flexibility and agility. Each class of technologies has different objectives and value propositions and thus needs a different kind of business case. Buyers that mix these technologies together in a business case do themselves substantial disservice.
The way you need to evaluate the two distinct types of technologies (and providers offering them) is completely different. A provider that recognizes that automation, robotics, and SaaS are about changing the nature of delivery will have a much more thoughtful conversation with you and build its value proposition around flexibility, speed, and quality of service and cost.
A provider that recognizes the impact of mobility, cloud, big data, and the IoT technologies will talk to you about a value proposition around standing up exciting new capabilities, creating new offers and changing the conversation with your end customers.
So, buyer beware. If you’re talking with a provider that mixes these technologies’ distinct value propositions together, you’re dealing with a provider that really doesn’t understand what they’re offering.
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The service provider community is very fond of clever terms, and SMAC — standing for Social, Mobile, Analytics, Cloud — is a good example of that. However, if you’re a service provider looking to sell to new or existing clients, talking about SMAC may not be the most productive way to hold the conversation.
The most productive way to uncover a significant opportunity is to talk to your customers in their language about the business issues they have. Sure, they’re looking for technology answers to their issues, but very few of them use the term SMAC of their own volition.
So if you’re talking to a retailer about their out-of-stock condition, for instance, talk about the practical ways that your solution will help them identify where they’re out of stock and how you can help them prevent that from happening.
Software tools can be very powerful. But as I’ve blogged several times in recent months, decision rights and buying influence are flowing toward the business users rather than CIOs. Providers must change terminology and communication to successfully capture their attention and serve them well.
Use simple business terms to communicate what you can do for a customer. If you use clever technology terms, you’ll probably just marginalize your impact and consign yourself to the realm of being a geek.
My advice: Keep the acronym out of your sales toolkit. Don’t SMAC your customer!
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