Digital is a fast evolving space, where historical patterns aren’t always that helpful when trying to predict the future and shape business plans. This information vacuum is being filled by lots of people (like me) with strong opinions. Contrasting opinions usually lead to a healthy debate and better insight into the truth. But sometimes, ‘myths’ emerge – assertions that become accepted wisdom despite being unproven. Here are my myths of the moment:
1. Digital doesn’t apply to my business. Untrue. Digital is creating opportunities (and/or threats) in every sector. Whilst the impact is most pronounced in consumer facing sectors such as retailing, even asset-intensive B2B sectors are impacted. For example, mining companies are using 3D simulation to optimise utilisation of workers and machinery in vast underground coal mines (think Nintendo men).
2. Digital creates value by driving the top line. Not always true. As per our research into digital value, there are a cluster of sectors (e.g., insurance, banking, telco) where more value can be delivered by automating manually intensive processes to cut costs than by investing in marketing or sales technology.
3. Digital is an operational, not a strategic issue. Not always true. In some sectors, digital will drive a fundamental re-valuation of assets. For example, in logistics, parcel businesses are becoming more attractive (as more people shop online), whilst letter businesses are becoming less attractive (as people send emails instead of letters). Companies need to assess which businesses should be added to portfolio and which should be divested to reflect these shifts.
4. The digital agenda is the responsibility of the Chief Digital Officer. Not always true. When the digital agenda is narrowly defined (e.g., marketing focus) then it can make sense to ask one executive (CDO, COO, CIO or other) to lead the charge. But for companies pursuing digital more broadly, many senior execs will have a role to play in execution. For example, to create a seamless digital customer experience in a bank requires marketing, distribution, products, risk and operations to be fully aligned. In these cases, the CEO has to get involved.
5. Digital can’t be planned because it moves too quickly. Untrue. There are a few ‘known unknowns’ in the digital landscape (e.g., which mobile devices we’ll be using in future) that can challenge digital planning. But there are also many variables that are quite predictable. For example the rate that consumers switch from physical to digital channels follows a predictable path. More importantly, there are some enablers (e.g., high quality enterprise data model) that will be critical in any possible future.
6. IT is the bottleneck in digital delivery. Not always true. Delivering the potential of digital requires new technology solutions to be delivered. Some IT shops have yet to adapt to the pace of digital and therefore create bottlenecks in delivery. But in many companies, IT have adopted new technologies and agile development processes that enable solutions to be delivered in days or weeks. In these cases, business decision-making is typically the bottleneck – IT developers may sit idle for days whilst business committees debate the finer points of the value proposition.
7. Digital won’t impact my job. Rarely true. If you work in a record store or travel agent, you’ve probably been significantly impacted already. And over the next years almost every job will be impacted in some way. Complex roles requiring years of training (e.g. radiography) are being replaced or augmented by software. Whatever your role, it’s time to go to digital school.