Chapter 1: The Five Domains of Digital Transformation PDF

Stuvia - Koop en Verkoop de Beste Samenvattingen Chapter 1: The five domains of digital transformation Digital transformation = A change in how a firm employs digital technologies, to develop a new digital business model that helps to create and appropriate more value for the firm (Verhoef et al.,...

Stuvia - Koop en Verkoop de Beste Samenvattingen Chapter 1: The five domains of digital transformation Digital transformation = A change in how a firm employs digital technologies, to develop a new digital business model that helps to create and appropriate more value for the firm (Verhoef et al., 2019, p. 1) The phases of digital transformation: The five domains of strategy are: 1. Customers 2. Competition 3. Data 4. Innovation 5. Value The five domains of strategy are changing: The impact of the digital transformation is enormous, as barriers disappear under which virtually every business domain operates. 1. Customers From Customers as mass market Communications are broadcast to customers Firm is key influencer Marketing to persuade One-way value Economies of scale To (digital) Customers as dynamic network Communications are two-way Customers are the key influencer Marketing to inspire purchase, loyalty, advocacy Reciprocal value flows Economies of customer value - This is forcing businesses to rethink their traditional marketing funnel and reexamine their customers’ path to purchase. - Rather than seeing customers only as targets for selling, businesses Gedownload door: matsmolenberg | [email protected] Dit document is auteursrechtelijk beschermd, het verspreiden van dit document is strafbaar. ¤ 912 per jaar extra verdienen? Stuvia - Koop en Verkoop de Beste Samenvattingen need to recognize that a dynamic, networked customer may just be the best innovation partner they will ever find. 2. Competition From Clear distinctions between partners and rivals Competition is a zero-sum game Key assets are held inside the firm A few dominant competitors per category - To (digital) Blurred distinctions between partners and rivals Competitors cooperate in key areas Key assets reside in outside networks Winner-takes-all due to network effects Zero-sum game = a situation in which an advantage for one party must necessarily result in an equally large disadvantage for one or more other parties Today, we are moving to a world of fluid industry boundaries, one where our biggest challengers may be asymmetric competitors— companies from outside our industry that look nothing like us but that offer competing value to our customers 3. Data From Data is expensive to generate in firm Challenge of data is storing and managing it Data is a tool for optimizing processes - To (digital) Data is continuously generated everywhere Challenge of data is turning it into valuable information Data is a key intangible asset for value creation The current “big data” tools allow firms to make new kinds of predictions, uncover unexpected patterns in business activity, and unlock new sources of value. Data is a vital part of how every business operates, differentiates itself in the market, and generates new value. 4. Innovation From Decisions made based on intuition and seniority Testing ideas is expensive, slow, and difficult Failure is avoided at all cost Focus is on the ‘’finished’’ product - To (digital) Decisions made based on testing and validating Testing ideas is cheap, fast, and easy Failures are learned from, early and cheaply Focus is on minimum viable prototypes and iteration after launch Digital technologies make it easier and faster to test ideas, to can gain market feedback from the very beginning of our innovation process, all the way through to launch, and even afterwards. 5. Value To (digital) Gedownload door: matsmolenberg | [email protected] Dit document is auteursrechtelijk beschermd, het verspreiden van dit document is strafbaar. ¤ 912 per jaar extra verdienen? Stuvia - Koop en Verkoop de Beste Samenvattingen From Value proposition defined by industry Optimize your business model as long as possible Judge change by how it impacts your current business Market success allows for complacency - Value proposition defined by changing customer needs Evolve before you must, to stay ahead of the curve Failures are learned from, early and cheaply ‘’only the paranoid survive’’ The only secure response to a changing business environment is a path of continuous evolution, where each technology is viewed to expand and improve our value proposition to our customers. Rather than waiting to adapt when change becomes a matter of life or death, businesses need to focus on seizing emerging opportunities A playbook for digital transformation To master competition in the digital age, businesses must learn to cope with asymmetric challengers who are reshuffling the roles of competition and cooperation in every industry. They must also understand the increasing importance of strategies to build platforms, not just products. Digital Transformation playbook = the five strategic themes for businesses related to the five domains by uncovering how the limitations of your traditional strategy are changing and how opportunities are emerging to build your business in new ways. Domains Customers Strategic themes Harness customer networks Competition Build platforms, not just products Data Turn data into assets Innovation Innovate by rapid experimentation Value Adapt your value proposition Key concepts - Reinvented marketing funnel Path to purchase Core behaviors of customers networks Platform business models (In)direct network effects (Dis)intermediation Competitive value trains Templates of data value Drivers of big data Data-driven decision-making Divergent experimentation Convergent experimentation Minimum variable prototype Paths to scaling up Concepts of market value Paths out of a declining market Steps to value proposition evolution Gedownload door: matsmolenberg | [email protected] Dit document is auteursrechtelijk beschermd, het verspreiden van dit document is strafbaar. ¤ 912 per jaar extra verdienen? Stuvia - Koop en Verkoop de Beste Samenvattingen Digital innovation and strategy often focus heavily on start-ups. But the challenges of starting a digital business are very different from those of adapting an established business that already has infrastructure, sales channels, employees and an organizational culture to contend with. Rogers (2016) mostly we will look at existing enterprises founded before the Internet and learn how they are adapting. For this, Gedownload door: matsmolenberg | [email protected] Dit document is auteursrechtelijk beschermd, het verspreiden van dit document is strafbaar. ¤ 912 per jaar extra verdienen? Stuvia - Koop en Verkoop de Beste Samenvattingen The book includes a set of nine strategic planning tools: Nine tools for digital transformation 1. Customer network strategy generator (Ch. 2) 2. Platform business model map (Ch. 3) 3. Competitive value train (Ch. 3) 4. Data value generator (Ch. 4) 5. Convergent experimental method (Ch. 5) 6. Divergent experimental method (Ch. 5) 7. Value proposition roadmap (Ch. 6) 8. Disruptive business model map (Ch. 7) 9. Disruptive response planner (Ch. 7) These tools can be categorized as follows: 1. Strategic ideation tools: Tools for generating a new solution to a defined challenge by exploring different facets of a strategic phenomenon ➢ (Customer Network Strategy Generator, Data Value Generator) 2. Strategy maps: Visual tools that can be used to analyze an existing business model or strategy or to assess and explore a new one ➢ (Platform Business Model Map, Competitive Value Train, Disruptive Business Model Map) 3. Strategic decision tools: Tools with criteria for evaluating and deciding among a set of generic options available for a key strategic decision ➢ (Disruptive Response Planner) 4. Strategic planning tools: Step-by-step planning processes or methods that can be used to develop a strategic plan tailored to a specific business context or challenge ➢ (Convergent Experimental Method, Divergent Experimental Method, Value Proposition Roadmap) Gedownload door: matsmolenberg | [email protected] Dit document is auteursrechtelijk beschermd, het verspreiden van dit document is strafbaar. ¤ 912 per jaar extra verdienen?