OMNI_EXPERIENCE_DX
4 likes2,341 views
The document discusses the need for companies to shift towards providing an omni-experience for customers by delivering seamless experiences across channels and giving customers control over customizing products and services. It states that by 2018, 20% of industry leaders will allow for this level of customization. Delivering an omni-experience requires deep digital transformation across the entire organization through collaboration between business and IT leaders. The document examines how to succeed in omni-experience transformation.
OMNI_EXPERIENCE_DX
- 1. S_HIFT_TO_OMNI-EXPERIENCE_DX CUSTOMERS WANT OMNI-EXPERIENCE AND THEY WANT IT NOW. ARE YOU READY? POWERED BY
- 2. With smartphones in their hands, search, social and shopping at their fingertips, to- days customer demands more. They are not just the right now generation, in the age of the intimate algorithm that shapes their digital experience around their context, beliefs and behaviours they are the right-for-me generation. They expect brands to not just deliver seamless experience across channels, they expect brands to enable them to shape their product and experience to their needs in all channels. In fact by 2018 20% of industry leaders will allow customers to build custom product and ser- vices giving them control over the experience. Delivering this level of omni experience requires deep digital transformation (DX). DX efforts require collaboration across the organization. But IDC believes that by 2018, 70% of siloed digital transformation initiatives will ultimately fail due to insuffi- cient collaboration, insourcing or project management. This report looks at how to succeed in omni-experience transformation. Tomorrow Daniel is going to order a pizza, his own special Pizza. A pizza he created and which has been so popular on social media he gets rewarded by the pizza restaurant.“Hey Alexa”he’s going to say“I’d like my special, delivered to home”“Don’t forget the wings’Alexa prompts him. Behind the scenes the price of his pizza is being kept stable and margins high despite an in market rise in dairy costs thanks to the pizza restaurants ability to access a global supply network, driven by predictive inventory manage- ment. His and thousands of other orders are carefully monitored along with Net Promotor score, order to dispatch and order to delivery service levels, inventory levels and social mentions. There’s Daniel’s order out on dispatch “Order 239223: One Daniel Special + wings – ETA 2 minutes. Alexa’s going to let him know.“Daniel Pizza arriving in 2 minutes”. Daniel can see on his phone the Robotic Delivery Unit making its way down his street. His voice unlocks the unit so he can collect his pizza. His pizza has been tracked all the way by the last mile delivery company using virtual reality to track all the robotic delivery units with AI pre- dicting traffic issues and best routes. Through the video feed on the delivery unit they can see Daniel taking out his pizza and wings. Daniel gives a quick 5 stars rating. Alexa notifies him.“Daniel, you have a voucher for free wings to say thanks for being a great customer” For leading Omni Experience companies this is not tomorrow’s experience this is happening today. THE_FUTURE_OF_OMNI_EXPERIENCE: DANIEL’S PIZZA_TOMORROW
- 3. ARE_ORGANISATIONS_IN_ASIA_PACIFIC_SET_UP TO_SUCCEED_IN_DIGITAL_TRANSFORMATION? ENABLERS_OF_DIGITAL_TRANSFORMATION IDC forecast worldwide spending on DX technologies to be more than $1.2 trillion in 2017, an increase of 17.8% over 2016. Asia/Pacific (excluding Japan) will see the largest investments in DX technologies in 2017 of all regions, with 37% of the worldwide total. The pace of DX is accelerating in Asia/Pacific, but 45% of organizations are still in the first stage of DX maturity (out of 5 stages), compared with 14% in the United States. Organiza- tions in Asia/Pacific need to focus on accelerating their digital capabilities, otherwise they will face irrelevance. If successfully done, this will help drive competitive advantage, grow reve- nue, and ultimately increase market share. Thirty-three percent (33%) of organizations (the second largest group) fall within the opportunistic stage of Digital Transfor- mation (DX) maturity. These organizations have already es- DX is a board-level initiative and is at the heart of business strategies for companies of all sizes. Enabled by innovation accelera- tors, such as Internet of Things (IoT), cognitive/AI systems, and 3D printing, together with the 3rd Platform technologies of social, mobile, analytics, and cloud, DX represents a huge opportunity for companies to redefine their processes, operating models and customer engagement initiatives. Organizations need to master the disciplines of Leadership DX, Omni-Experience DX, Information DX, Operating Model DX, and WorkSource DX in order to compete in the Digital market- place. The power of the five disciplines is in their synergy — in digital enterprises, the whole is much greater than the sum of the parts. Leaders that understand and can exploit those synergies will be the digital thrivers of the future. • Leadership DX: This set of disciplines enables businesses to develop the vision for digital transformation of products, services, and experiences that are optimized to deliver value to partners, customers, and employees. • Omni-Experience DX: This dimension describes an om- nipresent and multidimensional ecosystem approach to continually amplify experience excellence for products and/ or services. • Information DX: This dimension encompasses the focused approach to extracting and developing the value and utility of information relative to customers, markets, transactions, services, products, physical assets, and business experiences. • Operating Model DX: This dimension describes the ability to make business operations more responsive and effective by leveraging digitally connected products/services, assets, people, and trading partners. Operating Model DX defines “how”work gets accomplished in terms of digital transformation. • WorkSource DX: This dimension covers the evolution of the way that businesses will achieve business objectives by effective sourcing, deployment, and integration of internal (full- and part-time employees) and external (contract, free- lance, and partner) resources. DIGITAL TRANSORMATION tablished basic digital capabilities, but to progress to the next stage of maturity (repeatable) they need to focus on increas- ing the integration and consistency of its digital initiatives. DX is not just another technology trend, but a critical business priority for many CEOs and their leadership teams across Asia/ Pacific. Processes and business models that were optimal a few years ago are now outdated — or simply don’t provide the speed and agility required to compete. The fact that the majority of Asia/Pacific organizations are in the first 2 stages of maturity shows that digital transformation is not as simple as buying a technology solution. DX involves a radical rethink of how to do business. To be successful, orga- nizations need to focus on developing the vision and strategy for digital transformation of products, services, and experienc- es to deliver value to partners, customers, and employees. MOBILITY BIG DATA / ANALYTICS CLOUD SOCIAL 3D PRINTING ROBOTICS COGNITIVE/AI INTERNET OF THINGS AUGMENTED & VIRTUAL REALITY NEXT GEN SECURITY 3RD PLATFORM INNOVATION ACCELERATORS DEVELOPERS INDUSTRY CLOUDS
- 4. WHICH_AREAS_ARE_BEING_TRANSFORMED Not many organizations have the ability to repeatedly disrupt market and personal behaviors by delivering world- class experiences across products and services to the entire ecosystem. There are some companies starting to deliver this type of“breakout”innovation by blending digital and physical experiences to garner customer allegiance. So, the challenge is for all companies to develop a multidimensional ecosystem approach to continually amplify experience excellence for their products and/or services, which is how IDC defines om- ni-experience DX. It requires the enterprise to deliver breakout innovation in the use of digital and physical connections, influ- ences, impressions, and triggers to transform the value of the ecosystem experience. LEADERSHIP TRANSFORMATION An“outside in” business environment OMNI-EXPERIENCE TRANSFORMATION Blend physical and digital experiences INFORMATION TRANSFORMATIION Information as a competitive advantage OPERATING MODEL TRANSFORMATION New digital revenue streams WORKSPACE TRANSFORMATION Ecosystem-based workforce
- 5. SHIFTING_TO OMNI-EXPERIENCE Customer Experience (CX) is the number one customer- related priority for organizations in Asia Pacific. The days of product-oriented sales and marketing are long gone. Today, simply having a good product and spending advertising dollars to promote it will not guarantee success. If it was difficult before, it’s only going to get harder as com- petition can come from virtually anywhere and everywhere in today’s hyper connected marketplace. With the rise of the sharing economy, business models are being disrupted, while customers’expectations of brands have also risen. Custom- ers in the digital age demand greater level of consistency, personalization, and meaningful experiences – something that is forcing brands to transform and become experiences to their customers. Furthermore, brands need to evolve to give their customers direct control over the experience and the products and services that are delivered. This requires organizations to rethink customer engagement and dream new possibilities with the advent of technologies such as augmented reality and robotics. Not every company is innately digital like Netflix or Amazon. But that is no excuse to sit on the side lines. Ready or not, every company now operates in a digital environment that demands and rewards business agility and digital transfor- mation (DX) innovation. To that end, omni-experience DX is
- 6. the key to continually attract and grow loyalty with customers. With the help of enabling technologies such as listening and sensing, learning, automation, and predictive responsiveness, omni-experience DX enables businesses to continually rede- fine and innovate products, services and customer engagement. DX thrivers understand that to succeed they need to take an ecosystem-based approach, attracting and growing loy- alty among all constituents - not only customers, but also For industry incumbents, this drive toward Omni-experience has their business and IT leaders, if they haven’t already, com- ing together to ensure this becomes core to the organization’s strategy. CIOs, for example, are seeking to enable the business to digitally transform with the help of disruptive technologies like AR/VR, AI, Big Data and IoT. The IT organization also needs to be staffed with the necessary skills in data privacy, security, and enterprise architectures. partners, suppliers and employees. This means embracing enterprise-wide transformation through investment in people, processes, and technology. Taking a siloed approach that focuses on one of these aspects may help you in the short term, but it’s only by incorporating all constituents and shifting to omni-experiences as part of your overall digital transformation (DX) strategy that you will be able to compete in the digital economy. FIGURE 1: OMNI-EXPERIENCE DX AND THE BUSINESS/ECOSYSTEM RELATIONSHIPS SOURCE: IDC, IDC MATURITYSCAPE: OMNI-EXPERIENCE DIGITAL TRANSFORMATION 1.0, #255754 Continuous communications and intelligence gathering Disruptive DX strategies Collaborative services Agile product delivery New business models YOUR ECOSYSTEM Channels Markets Customer Competitors Partners YOUR FUTURE ECOSYSTEM Future channels Future markets Future customers Future competitors Political trends Social trends Economic trends Regulatory trends Omni-experience characteristics Omni-experience creation and receptivity Autonomic adaption Amplified multi- dimensional messaging Multilateral bidirectional rewards and incentives Innovation culture Employees Experience Products Services Future employees Future experience Future products Future services
- 7. What is best-in-class? Organizations are starting to in- vest heavily to deliver Omni-Experience DX, but are they ready to tackle the complexity? Not many organizations are able to disrupt markets, let alone repeatedly. While there are companies starting to deliver “breakout”innovation by blending digital and physical expe- riences to garner customer allegiance, omni-experience DX remains a goal for most. The challenge is the complexity of transformation across the ecosystem of customers, partners and channels. SOURCE: IDC, IDC MATURITYSCAPE: OMNI-EXPERIENCE DIGITAL TRANSFORMATION, #255754 FIGURE 2: OMNI-EXPERIENCE DX MATURITY STAGES Asia/Pacific’s organizations are lagging behind in Omni-Experience DX maturity when compared to their peers in the US. Today only 5% of companies in the Asia/Pacific region com- pared with 22% of those in the U.S. are in the two most ad- vanced stages of Omni-Experience DX maturity, according to IDC’s Omni-Experience DX MaturityScape 2016 survey. Leaders that demonstrate self-adaptive market responsiveness contin- ually and sustainably grow the business ahead of the market. This is no surprise as they continually disrupt themselves and outpace the market by understanding and responding to the needs of their extended ecosystem needs to deliver optimized omni-experience. At the other end of the spectrum, 48% of Asia/Pacific enter- prises compared to 2% of their U.S. counterparts are in the first stage (Ad Hoc) of Omni-Experiences DX maturity. The inability of these organizations to engage and keep pace with the needs of their ecosystems means lost business opportunities. Key challenges companies are facing in their Omni-DX journey Culture, strategy, and processes: The organization’s culture is central to making omni-experience strategies work. Many organizations struggle because leadership does not provide adequate support for these initiatives. Doing so is critical since the ripple effect through the organization is profound. The alignment of corporate goals to create experiences that meet expectations and provide satisfaction is key. Technology platforms and fragmentation: The lack of well-defined strategies and processes in an organization has a major impact on technology selection and implementation, resulting in deployment of a variety of tools (i.e., point solu- tions) that cater to departmental-specific needs and that can fail to address the transformational nature of these initiatives. Organizations need to focus on integration, openness, scale – for data capture, processing, and analysis – adaptiveness and security. Data silos obstruct single views of the ecosystem: Data management is a top challenge for many organizations across Asia/Pacific. The growth of data and the variety of locations in which data resides within and outside the organization con- tinue to contribute to existing data silos, preventing effective collaboration across business functions and the organizations from having a holistic view of their customers and ecosystem. People and skills: The lack of skills to execute on these strat- egies is a key challenge impacting omni-experience transfor- mation. Organizations have dispersed individuals/groups that operate independently by functional role, as well as isolated and varying levels of skills. Best-in-class organizations with high-functioning levels of omni-experience DX demonstrate the following qualities: • A culture of innovation permeates all areas of the organization • Seamless, engaging omni-channel customer experiences are the norm • Creating unique differentiating experiences is a cornerstone of an organizational strategy • Listening and learning through all internal and external mar- ket cues are core to predictive market responsiveness • Processes are automated where humans don’t add value • Rewards and incentives offered for all members of the eco- system • Processes, products, and assets are highly instrumented, contextually aware, and autonomic • Continuous change and disruption experienced inside and outside of the organization. AD-HOC OPPORTUNISTIC REPEATABLE MANAGED OPTIMIZED SHALLOW Little ability to adapt business models, products, and services to deliver resonating ecosystem experiences BUSINESS OUTCOME Lost opportunity and slowed growth because of the inability to engage and keep pace with ecosystems needs ENRICHED Efforts to test multi-layered ecosystem approaches to create enduring relationships and to improve products and services BUSINESS OUTCOME inconsistent and unsustainable growth spurts tied to individual program efforts MULTIDIMENSIONAL Consistent, but not yet fully exploited, ability to create engaging and interactive multidimensional ecosystem experiences BUSINESS OUTCOME Improved ecosystem loyalty and buisness perfomance – at par with competition AMPLIFIED The ability to automatically drive the ecosystem to amplify high-quality contextualized product and service experiences BUSINESS OUTCOME Continuous ability to attract and retain relationships and grow market share by sensing and responding to market needs early DISRUPTIVE Self-improving ability to repeatedly disrupt market and personal behavioiurs by delivering incredible experiences across products and services BUSINESS OUTCOME Continually and sustainably grow business ahead of market as a result of amplified market responsiveness
- 8. It started with one man and a vision. Don Meij, CEO of Dom- ino’s Pizza (Australia), envisioned a simple, yet radical goal – to have 100% of Domino’s sales generated through digital channels. As a first mover to integrate digital into brick-and- mortar quick-service-restaurant (QSR) retailing, Domino’s is on its way to achieving its dream, with digital representing 70% of sales today. Meij foresaw omni-experience as a strategic competitive advantage and is seeking to broaden Domino’s digital ambition. Digital-First and the Resulting Software Clutter Domino’s digital journey began in 2006, after Meij took over the helm as CEO in 2005. Aspiring to be“where the customer is”and“delivering on what customers want”, Domino’s strived to be digital-first amongst its peers with multiple initiatives. CASE_STUDY: DOMINOS’ PIZZA_MOGUL 2006 2009 2011 2012 2013 First quick service restaurant (QSR) with online ordering and real-time pizza tracker. First Aussie QSR with iPhone app. First Aussie pizza chain with Android app. First Aussie pizza chain with iPad app “Pizza Chef”, and Facebook crowd- sourced pizza. First to add store and product ratings to online ordering site. Achieved 50% sales through online channels, with 50% of online sales through mobile By mid-2013, Domino’s developed multiple e-commerce channels including desktop (flash), mobile Web, mobile apps and Facebook commerce. These siloed applications proved expensive to maintain and made it hard for Domino’s to keep up with business demands. With an aggressive goal of digital generating 80% of sales as the next milestone, and additional plans to scale out the Australian infrastructure to Domino’s Eu- rope and Asia, Domino’s required a new technology platform. New Platform as Core of Ecosystem Domino’s approached a few software development compa- nies and finally found one which not only understood their goal but has a track record of delivering to it. Domino’s goal was not only to digitize their existing business model. The chosen partner adopts agile software development meth- odology and understands the nuances of retail. Through short release cycles which facilitated an ongoing feedback loop of what was working and what was not, Domino’s enabled con- stant business-to-IT collaborations and experimentations. Understanding Domino’s vision and goal, the partner worked toward rebuilding a core set of platform capabilities as first step. This approach broke down the customer journey into three main stages: ordering, pizza baking and delivery. At every stage, Domino’s and its partner mapped strategy to technology, beginning with: • Identifying core capabilities needed as part of the strategy. For example, for store-fronts’catalogue manage- ment capability, creating custom-built pizzas is one vital aspect to Domino’s vision of creating personalized experi- ences. This desired capability remains constant regardless of digital touchpoints or technology used to implement it.
- 10. • Designing and implementing identified capabilities into a core platform as channel-agnostic and reusable API services. This ensures core business processes are main- tained at one single point in the technology architecture, and are resilient to changes from emerging technologies or new man-machine interfaces. Edge implementations are designed to consume core services via APIs. • Experimenting with new products or services. With a core platform, business units can experiment with greater agility through integration to new touchpoints, or extend its ecosystem by integrating with partners such as new delivery modes. This approach ensures unproven changes are isolat- ed from core platform and can be easily de-coupled when needed. When proven, successes can be re-engineered into the platform as core capabilities. Embracing new ways of working, Domino’s built up a new extensible platform. From six siloed ordering sites, Domino’s and the partnership led to a new cross-channel API-driven HTML5 ordering platform in six months since its inception in July 2013. Delivering the immediate gains needed then while preparing Domino’s for the continuous disruption in the mobile and social ecosystem. The partner’s depth of experi- ence supported improved prioritization, idea validation, and executional speed across core initiatives. 3 Years of Partnership, Accelerated Innovation and Growth For Domino’s customers, the new platform simplified pizza ordering process; while new experiential features led to deep- er customer engagement, increased basket size and loyalty. One such example is“Pizza Mogul”, which allows customers to co-create their own pizza and share their pizza creations through social and personal networks – for every pizza sold, the creator is rewarded with up to $US4. • Co-creation of pizza recipes from hundreds of ingredients, across multiple digital devices and allowing customers the flexibility to pick up their personalized pizza from any of Domino’s branches, or have it delivered to their door. • Capitalizing on customers’interests in iPad app,“Pizza Chef”, which allows users to drag and drop toppings to create their pizza designs. Domino’s integrated this experience into its core platform, and expanded it to include social sharing, gamification and revenue sharing features. • Through social sharing, the platform enabled“an army of customers marketing their pizzas”through user-generat- ed content. Beyond extended reach, social sharing also enhanced message relevance and reciprocity as friends experience their favorite pizza creations in group settings, such as soccer games and family gatherings. • Domino’s measured sales records and monitored social sentiments to identify top-selling Mogul pizzas, which in turn drove product development. The change in approach achieved results beyond what traditional processes could hope to achieve. In 11 months since its inception, Pizza Mo- gul initiative has resulted in 55,000 users and 160,000 pizza creations. • GPS Driver Tracker not only provides delivery route updates to consumers via mobile, smartwatches and“Chromecast-ed TV”, the same underlying service directs delivery drivers through the most efficient route using real-time traffic infor- mation, avoiding congestions and enhancing drivers’safety. For Domino’s, its strategy to continuously disrupt itself through continuous digital innovations contributed to significant results. In first half FY17, Domino’s Pizza Aus- tralia reported 17.2% revenue growth to AUD$150 million, achieving 70% of sales through digital channels and marching on towards its vision of 100% digital sales. Continuing its digital transformation jour- ney to extend its value propositions further out along its ecosystem, Domino’s began CAA-approved trials for store-to-door drone deliveries from a selected Domi- no’s New Zealand store in August 2016. The use of drone delivery is designed to work alongside Domino’s current delivery fleet and will be integrated into its core platform comprising online ordering and GPS systems. This trial is expected to extend delivery coverage into hard-to-access areas and improve utilization of delivery assets.
- 11. CASE STUDY_REDMART: A_SWAT_TEAM_APPROACH_TO CUSTOMER_PROBLEM_SOLVING Redmart – Singapore’s answer to“grocer- ies-on-demand, delivered to your door,”thrives on complexity. At the core of the organization’s rising success lies data, and with this data, Redmart searches continually for more sophisticated ways of sourcing, managing, picking, pricing and delivering its 45,000 products to thousands of customers across the country. But unlike most established food retailers that build their brands through the establishment of extensive grocery and convenience store locations, Redmart came to market with a simple idea. Says company CEO, Roger Egan:“We started by getting the service perfect, then built it up from there.” It’s the story of three guys (Roger, and his co-founders, Vikram Rupani and Rajesh Lingappa) and a van.“Neither Vikram nor I had experience in e-Commerce, retail or technology, which, trust me,”he says,“made it awful hard to raise fund- ing…What we did have was a clear idea on how to build a better business.” Egan says that for the better part of the first year, he and his small team would spend their days with suppliers, their afternoons making deliveries, and their evenings, dividing up responsibility for all the other functions; HR, finance, logistics, etc. “Suffice it to say, this set the tone for our culture,” says Egan. Today, everyone who joins Redmart - regardless of title or position – spends time making deliveries, working in the warehouse, and understanding every aspect of the business. The result is a highly complex, fully integrated food retailing and delivery business built from the bottom-up. From one van and a skeleton team, Redmart now boasts a fleet of 150 delivery trucks, 80,000 sq ft of warehousing space, and 45,000 unique food items for sale. With such a heavy capital investment, it might have been easier to build a more traditional food retailing business. “But we wanted something different,”says Egan. “We realized early on that we needed to be a tech company, not a logistics provider or a traditional retailer.”And that epiphany, says Egan, has made all the difference. Unlike traditional businesses with clear functional verticals with separation of tasks and responsibil- ities, Redmart combine functional expertise into what they call‘Red Teams.’Each team includes commercial leaders, industrial engineers, data scientists and process experts. According to Egan, each team is then tasked to address a segment, a problem or an opportunity.“We then take the management of the operations to a whole new level,”he says,“by having each team define their own objectives, inter-dependencies, and KPIs. We then make these goals visible to the entire organization.” If it sounds like a recipe for anarchy, consider this: A true omni-channel business is born of inter- dependencies, real-time data, and absolute transparencies. This is terrifying terminology for more traditional organizations that have built businesses based on hierarchies, secrecy and top-down leadership structures. There’s a degree of humility that needs to be exhibited as well in a business like Redmart.“I don’t think it’s overstating it to say that it’s due to the Founders’high level of self-awareness and willingness to hire people with more knowledge and experience that they’ve been able to create a high-performance culture,”says the company’s Chief People Officer, Stephanie Nash.“I’d agree,” says Egan.“But it’s equally true that when you’re inventing a new business model it can sometimes be a danger in hiring executives with too much experience. Sometimes it’s harder to get people to un-learn what they’ve learned,”he says. While there’s no mistaking the premium placed on culture and people, nothing, says Egan, is more important than data.“It feeds into absolutely everything we do,”he says.“From delivery rate optimization to customer profiling and segmen- tation.”Application of artificial intelligence (AI) is central to Redmart’s long-term strategy.“The inter-relationship between all the complexities of our business require lots of analysis. Delivery, for instance, is a critical component. We time stamp every part of the delivery process from where the driver parks, to which building access we use, to time of day, routing, and coverage. There’s nothing we don’t consider in order to optimize the process.” Unless or until Redmart owns and operates phys- ical stores, it’s fair to say that the company isn’t actually entirely“omni”channel. “That may be so,”says Egan.“But I’d argue that it’s easier to learn the physical store operation side of the business than the effective application of AI… Bricks and mortar operations track operating profit based on profit per square foot. We measure profit per customer. Our operating models couldn’t be more different.” Egan does envision a time when Redmart will build retail outlets, but only to the degree that it adds that additional layer of convenience to the customer experience.“No matter what you do, there’ll always be people who want to touch and feel their vegetables,”he says. Suffice it to say, this set the tone for our culture”“ “ “But we wanted something different“ We then take the management of the operations to a whole new level “ “ No matter what you do, there’ll always be people who want to touch and feel their vegetables, “ “ From delivery rate optimization to customer profiling and segmentation “ “ We realized early on that we need- ed to be a tech company “ “
- 12. CASE STUDY_NESTLÉ: A_PEOPLE_FIRST_APPROACH_TO TECHNOLOGY_TRANSFORMATION “We want our communication to be data-powered not da- ta-driven, I hate the notion of data driven marketing. People drive, data doesn’t drive,”says Tom Buday, global head of mar- keting and consumer communications at Nestlé. Enabling transformation from the inside How can a 150 year old company embrace the spirit of innovation and transformation? A key pillar of Nestlé’s digital transformation is the DAT (Digital Acceleration Team) pro- gramme. Every 8 months, 12 employees from different markets and sales and marketing functions base at the DAT center in Vevey. Armed with always on social monitoring they are tasked with testing out the latest technology, creating meaningful pilot projects for the business. During their eight months, they reverse mentor senior executives, sharing their technology knowledge. At the end of the eight months they go back to their markets to drive transformation in their countries. Despite significant investments in technology Nestle firmly believes that it is people not technology that drive the transformation. In 2013 Nestlé set up an innovation outpost in Silicon Valley to enhance existing partnerships with the world’s largest technol- ogy corporations while looking for pioneers among the thou- sands of small technology startups that Nestlé can work with. Nestle is running multiple pilots involving AI, voice technology and Internet of Things. The push for digital acceleration comes as Nestlé faces the same challenges as many of its CPG cohorts: how to ramp up sales in fast-growing developing economies and eke out growth in developed countries where stagnant wages have reduced consumer spending power – all against a rapidly changing media environment. There are 3 key drivers of transformation at Nestlé. First, the rec- ognition that technology is affecting consumers’lives, chang- ing the way they live and interact with brands. Nestlé wants to keep up with that evolution, if not get ahead of it. Second, the fact that technology is fundamentally changing how marketing is done. Improving productivity, increasing effi- ciency in the marketing job driven by marketing automation. Third, whilst Nestlé is largely in the food and beverage busi- ness, physical products, they are increasingly using technology to add layers of service, incremental service surrounding prod- ucts or to reduce friction in the existing brand proposition. An example of adding omni-experience service layers is Milo, a chocolate malt beverage product. Milo recently launched a fitness tracker that links to an app that parents can use to monitor their eating and nutritional intake and to provide recommendations to parents on how to achieve balanced diets while having the child involved in friendly competition with their friends, through sports tips and augmented reality. The experience is uniquely tailored to each child using the data garnered from the app and fitness tracker, and the experience is managed and curated by the parents. This new approach to creating layers of service has opened up new channel oppor- tunities with Milo now sold in electronics stores. The platform is rolling out in key markets in Asia and Africa.
- 13. Delivering Omni-Experience, requires significant internal alignment not just around the vision, but also the measures of success and investment. Companies need to look at a holistic view of the gains from Omni-Experience. Many organizations moving towards mastery look at Net Promoter Score as an overarching goal and metric. Successful companies should build businesses cases that model the impact from customer growth, partner value creation, operational efficiency and em- ployee satisfaction. Aligning on the business case for change enables setting of hard goals and investment parameters. BUILDING_THE_BUSINESS_CASE: SCALING OMNI-EXPERIENCES_THROUGH TALENT, TECHNOLOGY NET PROMOTER SCORE New customer acquisition CUSTOMER GROWTH Customer lifetime value growth Advocacy growth Value of new joint business models PARTNER VALUE CREATION Shared data value Marketing Efficiency OPERATIONAL EFFICIENCIES Supply Chain Efficiency Channel Efficiency Increased staff satisfaction EMPLOYEE SATISFACTION Increased staff retention Efficiency of staff recruitment
- 14. FOUR_DIMENSIONS_ESSENTIAL: FOR_OMNI-EXPERIENCE_DX_MASTERY: Ecosystem Experience Ecosystem experience is the ability to continually amplify the engagement to increasingly attract and retain (grow loyalty) across all members, including customers, partners, employees, and things: • Strategy: Develop a strategy that is increasingly tied to au- tomating and adapting responsively to customer experience needs. • Communications: Extend communications multilaterally across the ecosystem including customers, partners and employees. Continuous Innovation Orientation Continuous innovation orientation is the organizational con- tinuous self-assessment and innovation that leverages input that transcends the ecosystem (customer, employee, partner, and things) boundaries: • Organizational structure: Develop an organizational struc- ture that enables agile innovation pilots and a fail fast mentality • Measurement/management: Improve the capability to auto- matically measure the value of ecosystem experiences. • Rewards/incentives: Develop rewards and incentives for all members of the ecosystem based on the value of their contribution. Omni-Dimensional Marketing Omni-dimensional marketing is the expansion brand and customer management to leverage digital connections, influences, and triggers that deepen engagement. Business performance hinges on delivering unique experiences long after initial engagement: • Message relevance: Improve message responsiveness by aligning with personalized and contextualized needs to create uniquely relevant experiences. • Message reach: Extend and amplify the impact of messages by evaluating and reinforcing high-performing paths. • Message reciprocity: Pay close attention to feedback, rewarding reciprocity with something the customer, partner or employee values. Platform Service Delivery Platform service delivery is the ability to leverage digital technologies to conceive, create, and execute on innovative contextualized ecosystem experiences that combine human and machine intelligence: • Architecture: Develop an adaptive architecture that fluidly scales and adapts to omni-experience foundational requirements. • Service management: Create adaptive services to support the creation of digital experiences that persist and resonate inside and outside the enterprise. • Data management: Effectively manage data privacy, securi- ty, and accuracy. Collaboration among key stakeholders is key to success in Omni-Experience DX For many executives, it will be an ongoing challenge to restructure their omni-experience processes to incorporate how changes in their ecosystem (e.g., customers and partners) impact current tactics and strategies and how quickly they can respond. Specifically, larger organizations will find it hard to quickly respond holistically to this need and may find it easier to create smaller omni-experience DX spin-offs and innovation initiatives to meet the challenge in an agile way. IT budgets are now shifting to line of business (LoB) and many innovation efforts are being driven by LoB adopting disruptive and third platform technologies. These efforts, despite presenting op- portunities for the organization, can lead into premature and siloed projects that are unable to accommodate the enter- prise needs, or that fail to achieve scalable business outcomes. This is because organizations’success is not dependent on a single business unit efforts. Success – particularly in the context of DX – requires businesses to take an outside-in perspective and align DX initiatives across departments and stakeholders, and the entire business ecosystem. Organiza- tions need to ensure that all the relevant constituents are aligned toward the same goal. Alignment cannot be achieved unless all the relevant stakeholders (e.g., CEO, CMO and CIO) have the right visibility into each other’s priorities, and shared goals and metrics. DX efforts, like Omni-Experience, require collaboration across the organization. Organizational siloes and resistance to change are common hurdles. In fact, as organizations progress they will often find that moving from being siloed, change-re- sistant and inwardly-focused, to becoming cross-functionally integrated and customer-focused is extremely challenging. In fact, IDC believes that by 2018, 70% of siloed digital transfor- mation initiatives will ultimately fail due to insufficient collabo- ration, integration, sourcing, or project management.
- 15. CRITICAL_SUCCESS FACTORS: THRIVING IN OMNI-EXPERIENCE_DX IDC predicts that by 2019, the top 20% of industry leaders will develop the ability to allow customers to build cus- tom product and service bundles that give the customer direct control over the experience. As we march towards the future of omni experience, firms need to think of their organization as the core of a self-learn- ing ecosystem, augmented and fueled by interactions amongst key constituents, who are aligned by a common Each key stakeholder on the leadership team needs to own and drive specific agenda’s and actions, but the key in the omni experience drive is to work these together as a joint agenda. Bring C-Level Agenda’s Together is Key for Omni-Experience Success vision. Supported by a core technology platform, which enables real-time information sharing, aligned KPIs and incentives, each constituent should gain visibility into the rest of the ecosystem so that they can detect, sense, decide and act independently in accordance to their context and goals. These independent actions will be redirected back into the ecosystem, resulting in a virtuous feedback loop, allowing the ecosystem to scale up and out, taking on a life of its own. ACTIONS CEO CMO CIO DO • Make your customer’s behavior and preferences your organization’s top omni DX challenge and link it to your overall DX strategy • Starting in the C-Suite develop a hunger for driving disruptive ecosystem experiences by setting up the capabilities and processes that will enable it • Create a culture of innovation that allows all employees to detect what type of change is essential and to respond quickly with concrete initiatives to engage and deliver value to customers through omni experiences • Establish organizational KPIs that track and measure that value and align rewards and incentives for all members of the ecosystem • Take the lead in driving the vision for excellence in customer experience • Create a clear roadmap for change with recognizable success along the way • Collaborate with customers and partners outside of your normal ecosystem to co-create experiences. • Do put in place a programme that will empower your organization to embrace data and technology capabilities • Create a clear data strategy that aligns across the organization • Develop an adaptive architecture that fluidly scales and adapts to omni-experience foundational requirements. • Create adaptive services to support the creation of digital experiences that persist and resonate inside and outside the enterprise. • Effectively manage data privacy, security, and accuracy. • Ensure key enterprise applications are well integrated and customer views allow for fast-tracking and customization of consistent and personalized experiences. • Invest in collaboration/communities, these investments will help breaking down organizational/cultural silos. DON’T • Don’t disregard the impact of digital technology on your customer’s behavior and preferences • Don’t pass new solutions from functional area to functional area through endless validation loops. You no longer have the luxury to manage the decline of your core business and develop long-term strategic plans to fend off disruptors. • Don’t try mimic the ecosystem experiences of your customers but make omni DX applicable to your business • Don’t exclude other parts of the organization, sales, product design, supply chain, IT, from collaborating in creating the vision. • Don’t make the roadmap for change never ending. Create time limited pilots. • Don’t exclude long term valued partners, they know your business. • Don’t rely on new hires only to drive transformation, recognise and develop internal skill sets. • Don’t ignore data governance, privacy and security are vital to manage for omni experience, partner with your CIO to drive this through the organization. • Don’t exclude other parts of the organization. Omni-Experience DX it is an enterprise-wide strategy that requires LOB leaders and IT buyers to work together on common business goals. • Don’t forget cultural change. Introduce change management techniques and incorporate them into the fabric of the enterprise. • Don’t think in terms of“2 speed IT”approaches. IT needs to bring together new digital capabilities and legacy systems/processes to scale DX. • Don’t rely on your existing skills, seek help from trusted partners to develop the right IT architecture • Don’t think in terms of the old linear- based KPI metrics. New metrics are required to track the success of your DX projects.
- 16. WHAT_ARE_THE_NEXT_STEPS? Assess the level of capability and maturity in each of the four dimensions of omni-experience DX: • Ecosystem experience • Continuous innovation orientation • Platform service delivery • Omni-dimensional marketing Develop an omni-experience plan that accounts for every element of the ecosystem and ensures that every internal S_HIFT is the partnership between Ogilvy Mather Asia Pacific and DHR International with independent digital transformation insights being supplied by IDC Asia Pacific. Bringing expertise in customer insight and brand (Ogilvy) and talent transformation (DHR), the objective of S_HIFT with the assistance of IDC’s tech- nology industry expertise is to help businesses tackle a holistic approach to digital transformation. S_HIFT research papers and executive briefings are designed to help the C-suite clarify and simplify in a world of digital disruption. And its bespoke consulting offering helps to unify the boardroom through structured assess- ments and tools, which ultimately help organizations plan, implement, and deliver short, medium, and long term strategic growth. For more information and to learn , visit https://www.shiftdx.com, or follow S_HIFT on Twitter at @S_HIFTdx. stakeholder understands the importance of amplifying the experience internally and externally. Develop a business case which paints a clear picture of success aligns the organization to the need for and outcomes from investment. Design and test a variety of digital ecosystem experiences and measure business performance improvements, keeping in mind that many digital tests won’t achieve expected results without a full commitment.