Digital transformation requires sentiment, operational excellence and experimentation

Organisations looking to survive the digital age must harness the triumvirate of customer sentiment, operational excellence through technology, and experimentation via new business models, Capgemini’s global head of sectors claims.

Speaking at the IT consulting and integration firm’s annual media lunch in Sydney this week, global head of sectors, Perry Stoneman, said one of the challenges many organisations still haven’t overcome around digital transformation is how to gauge and then act on customer sentiment.

He pointed out Capgemini recently launched an analytics engine to listen to and provide insights on customers for its clients and said having such data was vital to triggering organisational change.

“If you do that, the CXO has data to show to the rest of the business,” he said.

As an example, Stoneman said he’d worked with one client in the utility space to provide end- customer insights around solar panel usage in order to better understand the market and demand.

“If you can see that data, that can shock people into action,” he said.

The second core aspect of digital for Stoneman is driving operational excellence throughout the business using digital and related technologies and practices.

“You have to give your engineers the tools to adapt their behaviour and help them become customer centric,” he said. “It’s one thing taking customer sentiments to the CXO, it’s another to take that to the engineering team and show them how to make themselves more competitive.

“You have to balance digital across these two groups, so the floor manager won’t resent having to change their processes quickly.”

Developing new business models is the third vital pillar to Stoneman’s digital transformation agenda, and he argued every organisation should be looking at how to develop new products and services they can take to market.

As a way of achieving this, he noted the rising number of industries creating separate businesses outside of their BAU activities and functions, such as banking and retail organisations. These separate businesses are equipped with standalone branding, cloud-based IT infrastructure and a startup/agile mentality in order to support and target customers that want a full digital experience.

Capgemini is working with one retailer globally to launch a new retail business, as well as with one financial organisation around such initiatives, and Stoneman suggested early numbers indicated these models could be more than 50 per cent cheaper to operate.

As global head of industry sectors with a particular expertise in utilities, Stoneman said he continued to see organisations disrupted by digital embrace customer-centricity as an ideal or executive-level priority, but falter when it comes to putting this concept into practice.

At the same time, he said many of the world’s largest industries and sector players are facing disruption right now, in many cases from competitors or startups they’re not even aware of. Much like an iceberg, Stoneman claimed 90 per cent of threat is hidden under the water.

“Massive industries are being attacked – for example, oil and gas exploration and diversification, banking being targeted by fin techs,” he said.

Stoneman’s colleague and director of Capgemini Australia’s financial services business, Philip Gomm, added the urgency to act as an organisation to digital disruption will ultimately come from the customer.

“Innovation comes from the owners of the P&L, but it’s really driven by the customer,” he said. “That message of customer-centricity there, but many still don’t understand what that change means.”

More on digital strategy from the CMO archives:

• Why digital strategy equals customer experience
• Why business leaders need to own digital strategies
• Quick wins, culture and technology behind Telstra's digital strategy
• NAB shares the key ingredients to digital strategy success
• Doing digital strategy the Amway

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