Developing a Digital Strategy for Success
Conclusion: The true benefit of digital strategies is in the thinking, reviewing, assessing and critical evaluation of where the current state is and where the target needs to be. Organisations that have commenced digital transformation have recognised that capability development and ownership of the strategy can make or break success. It is critical to be brutally honest about capability and skills to get to the target.
Observations: There are many frameworks, methodologies and trends that organisations consider as they work to align their strategy, delivery approach, value proposition, skills and capabilities and organisational structure to business outcomes. Rather than repeat the strategy that has been used previously with a quick update and get back to operational activities, it is imperative to value the thinking and the journey to reach the right strategy answer.
Developing a strategy for business delivery success in the digital era requires an assessment of the existing foundations of why and what is the purpose of the organisation through whether a product-based or function-based approach is appropriate and on to how the organisation is structured to deliver on its strategic intent.
Often, developing a digital strategy is an administrative requirement focused on getting to a completed strategy document that is approved. Common methods of developing a digital strategy are:
- Update a previous strategy with incremental changes and include the implementation plan of known projects and work programs from wish lists. This will provide a document that is familiar but not necessarily the strategy that is required.
- Engage an external consultancy with experience in developing digital strategies to develop a strategy that can provide all the elements but often lacks ownership by the organisation, which is essential to embracing the strategy and not just the artefact delivered.
Developing a successful digital strategy needs a frank and fearless assessment of customers’ needs, strengths and weaknesses, value propositions and direction. It also requires a clear picture of what is required and where people fit in, and support of the strategy so that true ownership can occur. It means doing the ‘hard yards’ and not sprinting to a finished document so that other more operational or ‘front of mind’ activities can occur.
Some critical elements to really work through, with customers, stakeholders and teams, to inform a useful, relevant, courageous and embraced strategy, are as follows.
Discovery – Customer feedback on value, frustrations, expectations of new services or functions should be sought. This should include customers that have left, and perhaps even those that did not become customers but had a need for the service. Discovery also includes reviewing the ecosystem in which the organisation operates, industry competitors, and technology advancements and emerging products and services. For public sector organisations, this will include political mandates, government directions, whole-of-government strategies and policies. Discovery activities also include customer experience mapping (journey mapping) which incorporates the feedback from customers and applying it to the journey to identify key pain points.
Digital maturity assessment – Reviewing the current digital maturity across the organisation will provide a baseline and realistically inform direction and targets. A high degree of maturity across all domains may not be relevant or required. Domains considered in a digital maturity assessment include:
- Customer experience
- Data insights
- Strategy and leadership
- Security (including cyber security)
Business model – Review the business model and clearly define who the customers are, what is the value proposition (and this is particularly important where the service or organisation has been operating over a long period of time), what costs are involved and where the revenue comes from. Define who are the partners and what are the supply channels. Using a basic tool such as the Business Model Canvas1 and rigorously assessing each element will provide critical insights that will underpin the strategy.
SWOT analysis – Include critical stakeholders and resources and apply this traditional model bravely. Is the technical capability a strength but is the customer focus a weakness?
Update business model – Update the business model after additional assessment and review as the assumptions and ideas may have changed. For example, the SWOT identified that there is a weakness in internal capabilities and the need for partners to assist may have changed.
Digital strategy – Incorporate the insights and outcomes from the assessment and ideation activities and develop a strategy which includes:
- Summary of insights and analysis – what is the environment, where is the competition and what is emerging on the horizon that impacts on the strategic objectives and business outcomes?
- Strategic goals and objectives – high-level goals and objectives which include targets and measures.
- Scope of strategy – includes the services or scope of operations that the strategy covers and the time period for which the strategy will be applied.
- Execution and governance – how will decisions be made, how will progress be monitored and reported? This element will also address organisation structure, resources, partners, sourcing approach, execution approach such as product or function, agile and UCD.
- Approach a planning and strategy activity with a focus on the analysis and not just the document completion.
- Organisations need to consider what their current insights are about the business drivers, environmental factors including competitors and emerging technology to develop a digital strategy for success and not make assumptions.
- Organisations need to consider where their blind spot may be and ensure that all analysis has been undertaken to develop a digital strategy and the pragmatic implementation plan to achieve goals.
- “Business model canvas”, Business Models Inc
About The Advisor
Sue Johnston is an IBRS advisor who focuses on strategy and governance of private and public enterprise ICT. She is an accomplished and innovative strategist with more than 25 years’ IT and business experience across the public and private sectors. Sue has held a number of senior executive positions with IT vendors and major management consulting companies and provides coaching to IT teams looking to change the conversation with their customers, their executive and each other. As a CIO, she has led the ICT function through signiﬁcant transformation for organisations such as Department of the Premier and Cabinet, Auscript Australasia and TriCare Limited. Sue has also run a successful software development company and transitioned the company through an acquisition process. Sue chaired Innovation Committee in State Government which was responsible for generating, developing and funding innovative ideas and improving the skills and capabilities of public sector staﬀ in pitching ideas and successfully executing innovation projects.