MacKinsey published an article early Feb about Cloud Technology’s impact on Business led by Innovation and Digital Transformation. (Reference*). The value of impact is close to $1T by 2030 and most companies are just starting to scratch the surface.
The authors point to a few dimensions of capturing economic value…
Improving efficiencies - Rejuvenate (eg. IT systems optimisation provide a kicker of upto 15%)
Innovate - (eg. analytics and one customer view with e-commerce upto 30%)
Pioneer - new disruptive offerings and business models
They provide measures of impacts across Businesses - from a high in high tech/oil and gas to lesser impacts in Infrastructure companies. E-commerce and banking derive great impacts and CPG not as much. Interestingly, Insurance has almost 70?ITA growth in 2030 led by this capture.
Cloud Technology is enabling Businesses to become nimble, innovative and scalable; often with new approaches to the customer. Businesses can tackle uncertain events like Covid better, as they can quickly remodel. Speed to execution is faster and they can outdo competition who are not yet Cloud enabled.
The authors, however may not be addressing some Businesses that depend on retail visits or physical contact - education, wellness, fitness, clubs, hotels, sit-in restaurants and tourism. These business have on-site contact at the core of their offerings. With continuing Uncertainty of Covid, the very existence of some of these Businesses’ is under threat.
These Businesses are the focus of this article.
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Given the pandemic, with physical contact limited or totally absent..
Universities, Schools and businesses like yoga centres, fitness centres were forced Online; leaving many gaps in the effectiveness. The experiences of students / customers have still much ground to cover? Hotels and Restaurants have inventories of rooms/facilities with low utilisation; affecting top lines and profitability. How can they bounce back?
These Businesses are seeing changes in their ecosystems…of customer and stakeholder behaviour. There are seeing nimbler offerings from technology led companies.
Many are implementing strategies finding niche growths. Some have launched new services - mobile apps for better customer engagements, hotels with home deliveries, safer sanitised spaces, sleeker online services…These have provided some relief but they know much more needs to be done.
Here I am proposing a construct based on consultations with businesses around Customer Experience Management to unlock Revenue Growth; over the past 5 years globally.
Faced with a disrupted market context and reduced revenues, these Businesses need to choose the right priorities amongst the 3 stage value capture of Improved Efficiencies, Innovation and Pioneering. They may need to start with the “Pioneering” stage first.
The first step is for the Leadership team to decide the future of their Business.
Imagining the Future of your Business
It is no secret that the consumer and markets are changing with increasing regularity. The past year has altered many “regular” behaviours forcing leaders to RE - imagine a future state of the Business. They need to consider Ecosystem trends, Customer and Stakeholder rapidly shifting needs, adjacencies, partnerships and impacts of events like Covid.
With Experience in the centre, many expertises need to coalesce - Brand Management, Sales and Marketing plus Business Strategists and Operations. They need to imagine a Business leveraging Data, AI, Mobile, Security and platform services. Technology as the enabler here. Technology today can be accessed with low capital expenditure, and is flexible, cost efficient and scalable.
No wonder Hotels, Restaurants, Wellness and many more, are indeed re-imagining their Business. As is Education.
In the Education space, disruption now points to a Hybrid online-offline instruction method, multi campus education, remote teachers, flexible curriculum and experiential elements. Cloud Technology can help build a flexible business model with a staged roadmap to the desired future state. In Re-thinking this future, the students and stakeholders like Teachers have to be central.
Customer centricity is the most lasting moat. In a Business model where every aspect of the Business is led by Customer Delight and Feedback. When Rethinking Businesses, the focus on Customer Experience is key.
Customer Experience Management
Even prior to Covid, Customer Experience had begun to take centre stage. Customers today are demanding Personalisation and Flexibility. A gym enthusiast wants seamless experience with his wearable, his gym equipment and his in-home Paleton bike. Just like Customer preferences are changing, needs of stakeholders like Fitness Coaches, Channel and Management/Concierge; are changing too. In the past few years, Businesses built around Personalised and Targeted value offerings have garnered the most loyal customers with sustained growths.
Covid now has added more experience paradigms with new demands like social distancing, safety guidelines and non site engagement. Many of these Customer Experiences fell short last year?
Delightful Customer Experience needs to span the Life Cycle Journey. Great Experience cannot exist in silos…in retail but not online? Experience needs to be delivered across the touch points…be it retail onsite, website, mobile or support. Everyone in the organisation needs to be involved - marketing to customer acquisition to product offering to retail experience to online to customer support.
Yes, Mobile is the most powerful way to deliver this Experience. But Mobile should not be an afterthought, as it mostly is. Mobile should span the Customer Life Cycle Jouney. If Mobile Engagement can be the cornerstone of the Business Re-design efforts, the rewards are sizeable. This leads to full understanding of the customer and therefore targeted marketing and Loyalties.
Furthering the Education example, imagine the Students and Teachers being able to manage their entire Experience Digitally - from scheduling to managing online/offline classes across Campus and Hostel Experience? And all stakeholders from Marketing, Facility management, Finance, IT, Administration, Franchises and Management need to be an integral part of this Experience. Imagine all that being delivered on Mobile in a user friendly, intuitive manner. How Delightful would that be?
So now we have a technology enabled Reimagined Business with Customer Experience at the heart of it. In spirit and as a vision for the Business.
But delivering these in a cash strapped, declining revenue scenario is tough.
Executing in the Current Context
With challenged revenues and cash flows, it is tough to lead Transformation. Employees and Stakeholders aren’t exactly in great circumstances.
But now may also be the best time. Operational loads are low, the organisation can find bandwidth to focus on these long term competencies. This could prove to be the much needed morale booster for the teams.
The key is to build a roadmap of “wins” to reach the final desired state.
The Implementation has to be led by an orchestration of the right test pilots and validations to hit invigorating revenue drivers; which will help carry the momentum through the organisation. In building these roadmap of “discovered” revenue drivers, the organisation is seeding innovation and a culture of a technology friendly workforce. Given todays context, this may be the most vital driver of a long term sustainable business.
Depending on the size and complexity of the Business, this Transformation may take years. Culturally this has to be stage managed for maximum velocity. Driven with passion across the organisation, this customer centricity will also guarantee success through times to come. If done right, the organisation will surely evolve into a nimble, versatile and covid/future proof business.
Where the business is always ready and prepared.
Love to hear your thoughts!
