There is a high chance that when somebody says “digital transformation,” they mean something else. But what is it & how can you disrupt others or self-disrupt?
A companion to the blog post on digital transformation here https://goo.gl/UpRC9X
Putting Transformation back to Digital Transformation
1. P U T T I N G T R A N S F O R M A T I O N B A C K T O
D I G I T A L
T R A N S F O R M A T I O N
A c o m p a n i o n t o
DIGITAL TRANSFORMATION BLOG POST
3. Those who refuse to adapt, will fall behind.
Those that embrace digital transformation
(such as the one bringing you House of Cards)
will leap forward.
He believes the newspaper’s only way to survive is
to stick to the tradition, to hard news.
Tom got fired afterwards.
5. There is a high chance that
when somebody says “digital
transformation,” they mean
something else.
6. Do they mean
This is like putting on fashionable
clothes to look more impressive.
In this case, the “clothes” are cool
digital technologies.
1. DIGITAL DRESS‐UP?
7. Examples
Building a website for your business
where none exists
Making an online store that lets people
browse products and create orders
without payment or other integrations
DIGITAL DRESS‐UP
8. Or do they mean
This maintains what the business is
doing but seeks to do it better by
leveraging digital.
Similar to when a person gets a
makeover, it doesn’t necessarily
change who they are underneath.
2. DIGITAL MAKEOVER?
9. Examples
A marketing department rolling out a new data
analytics platform that allows the company to
customise content & target readers more precisely
An IT division upgrading their systems to the cloud
to reduce maintenance costs and improve efficiency
DIGITAL MAKEOVER
13. Xerox’s margins and market
share were suffering due to
competition from Asia.
By 2000, Xerox’s more
complicated, expensive line of
copiers and printers resulted in
net losses of $273 million.
SITUATION
SYNOPSIS
14. DUAL TRANSFORMATION PATH
Reposition the core
business to adapt to the
changing environment
Branch out to a digital
offering that will be the
main source of growth
Machines that could
match competitors’ price
and simplicity, and beat
them in technology.
Xerox Global Services
formed to handle document
management and other
back-office processes.
15. Businesses tend not to consider
digital transformation before it
is too late, i.e. when digital
disruption is inevitable.
16. Disruption occurs “when a
business creates or employs a
technology in a new way, forming
a business model that provides
an edge over competitors.”
Digital Disruption
HERE
Read more on
18. HOW THE INCUMBENT WAS DISRUPTED
BLOCKBUSTER NETFLIX
Was comfortable with a
45% market share in 2003,
before going out of
business seven years later.
Shifted its focus to online
streaming, then invested in
content production. Latest
revenue at $6.78 Billion.
Focused on opening new retail
stores and entering new markets.
Gained traction with its mail-
based DVD rental service.
19. HOW THE INCUMBENT WAS DISRUPTED
BORDERS AMAZON
Being late in the digital
game, the incumbent ceased
its operations in 2011.
Moved to e-books, e-book
readers, and an all-you-can-
get e-store nowadays.
Over-invested in retail stores
and CD sales.
Made its debut as an online
book store in 1995.
20. Undergo a full blown digital transformation
Cannibalise their core business to make
way for something new
Self-disruption: Sometimes companies need
to go against their corporate instincts and...
21. European media company wasn’t
satisfied with just a digital
makeover like other newspapers.
From 2005, the business started
acquiring new digital properties
and moved to online classifieds.
Moreover, it also divested some
of its biggest print media
products, accounting for 15% of
its sales in 2013.
AXEL SPRINGER
Today, the media
company derives 70% of
its EBITDA from digital.
22. Once you have opened up to
the possibility of disruption,
the next step is to formulate
a strategy.
It would help detect digital
disruption early on and make
pre-emptive moves.
IDENTIFYING
THREATS &
OPPORTUNITIES
27. Domino’s pizza delivery tracking gives real-
time insights
BeerDroid offers connectivity for home
beer brewing hobbyists via a mobile app
NEW VALUE PROPOSITION
29. Amazon’s Kindle Direct Publishing
connects authors directly with readers
HYPERSCALING PLATFORM
30. Another way to spot threats and
opportunities is by looking at
how competitors may unbundle
or decouple the components of
your products.
UNBUNDLING &
DECOUPLING LENS
31. Allows consumers to only buy
what they want.
The picture on the next slide
shows how various disruptors
have unbundled the services of a
traditional bank.
Essentially, they zoom in on a
specific consumer need (e.g.
wealth management) and try to
do it better.
UNBUNDLING
33. The “separation of consumption
activities that traditionally go
together, hand-in-hand.”
In the diagram below, disruptors
separate the non-value creating
portion from consumption
activities and only focus on the
value creating portion.
DECOUPLING