Customer Relationship Strategies Quiz

M&O in the Digital Economy (1)

• Digitalisation reduces the amount of objects carried, enabling more tasks to be done with smartphones using intelligence systems.
• Digital disruption displaces existing market, industry or technology; it is both destructive and creative.
• Mobile phones, apps, and Wi-Fi are fundamental enablers of digital life.
• Analog technology translates information into varying amplitude pulses while digital uses binary format (0 or 1).
• Digital technologies have advantages such as low cost, preserved privacy, and easy data merging, but disadvantages such as potential errors and higher bandwidth needs.
• Start-ups are human institutions for new products/services in uncertain markets.
• Unicorns are startups valued over $1 billion (e.g., Airbnb, Uber).
• Digital Economy is a wave disrupting markets, companies, and business models.
• Digital transformation isn't only about technology but also a mindset shift focused on adaptability.

Technology Innovation - a key driver of digital transformation

• Technology drives digital transformation, but it is not sufficient to transform an economy, business or society.
• Computers evolved from abaci to modern microprocessors due to scientific breakthroughs, particularly during critical periods like World Wars.
• Grace Hopper was a pioneering figure in software development and programming.
• The Internet, as a vast network of computers, was initially driven by the need for secure communications (ex. WWII, Cold War).
• The internet faced earlier phases, including the initial ARPANET, basic services, and later the rise of e-mail, FTP, Telnet, Usenet, and the WorldWideWeb.
• The Internet evolution is characterized by several stages, from the early e-mail and bulletin board systems to the rise of the commercial web (eBay), the dot-com bust and the rise of social networks, interactive websites and mobile web.
• The Four V's of big data are volume, velocity, variety, and veracity.
• Internet of Things (IoT) links physical and digital worlds via radio signals.

From Product to Customer

• Digital transformation is a shift from product-centric to customer-centric strategies.
• Product-centric competition prioritizes market share without specific customer focus.
• Customer-centric competition focuses on satisfying individual customer needs and increasing customer engagement.
• Customer-centricity and product-centricity can coexist, one does not have to exclude or oppose another.
• Customer centricity is now an increasingly important strategy in light of the digital age.

Mass Production vs Mass Customization

• Mass Production focuses on efficiency, stability, and low-cost production for homogeneous markets. Mass Customization focuses on variety and adaptability, with higher costs for heterogeneous markets.
• Customization can be collaborative, adaptive, cosmetic, or transparent.
• A high degree of market turbulence makes adaptability important to compete with mass customization.

Transition from Mass Production to Mass Customization

• Mass customization transitions through 5 phases: customization of services, embedding customizability, creating point-of-delivery customization, providing quick response, and modularization.
• In the digital age, a shift in strategic assumptions is from mass markets to dynamic networks.

Customer Networks Strategy

• Digital customers are active, engaging with brands and completing transactions through various channels.
• Customers are actively involved in co-creation of content, brands are influenced by feedback and social interactions.
• Access, engage, customize, connect, and collaborate are key strategies (these are 5 customer network strategies) for today's digital businesses building their strategy.

Build Platforms, Not Just Products

• Digitization, digitalization, and digital transformation are different, each representing a degree of change in processes or capabilities
• Technology innovation creates disruptions, by changing how business models work, and what organizations and business can achieve and in particular how we can reach customers
• Platforms gather different stakeholders; it's a peer-to-peer relationship.
• Platforms are facilitators for exchanges between buyers and sellers.
• Examples of platforms that are very successful are those that have less assets: Uber, Facebook, Alibaba, Xiaomi, Airbnb.
• Collaboration btw companies is key in this disruption.

From Data to Assets

• Turning data into assets involves understanding customer behaviour, predicting trends, tailoring experiences, and leveraging data for proactive adjustments.
• Big Data can be turned into value through multiple ways s.a. analysis of current data, identifying gaps, collecting new data and sources and creating an execution plan to execute the data strategy.

Adapting Value Proposition Online

• Three routes for value proposition improvement: growing market share, preserving market share, or growing the market share and profit
• Companies can evolve their value proposition by identifying customer needs and pains, providing solutions that address these.

Business Models in the Digital Economy

• Business models define how a company creates value, delivers it, and captures value, answering to the question as to how the Data Economy affects the business model innovation.
• The business model canvas is a helpful tool for companies to define their models - it identifies nine blocks (customer segments, value proposition, channels, customer relationships, key activities, revenue streams, key resources, cost structure, and key partners)

Disruptive Business Models

• Disruption happens when a new entrant provides significant value to customers in ways incumbents cannot compete with directly.
• Disruptive innovations often start in low-end markets serving a segment not currently served well and then progress towards mainstream markets.
• Factors contributing to disruption include a difference in value proposition that displaces the value offered by incumbents, and a difference in the value network that acts as a barrier to imitation by incumbents.

The Internet of Things

• IoT connects physical objects to the internet via sensors, processors, software, and antennae, improving efficiency, accuracy and economic benefit.
• The capabilities of IoT products (monitoring, control, optimization, autonomy) can transform a variety of industries. -> The combination of these capabilities can change dramatically the way businesses operate
• The 5 forces of Porter (competition among competitors, threat of new entrants, bargaining power of suppliers and buyers, threat of substitute) are shifting and are all impacted by IOT.

COVID-19: How Digital Contributes to Social Cohesion

• Blockchain facilitates trustworthy, efficient transactions—an example of a decentralized network with no third-party intermediaries.

The Fourth Industrial Revolution

• Industry 4.0 is characterized by the fusion and acceleration of several technologies blurring boundaries of physical, digital, and biological spheres.
• This revolution aims to empower people through a combination of technologies, particularly AI, IoT, and automation, to foster collaboration across various industries.
• This aims to increase efficiency and create new models of value for customers