The diagram below is a progression model that describes the move from selling a thing towards selling services.
As we shift our attention from the left “blue side” of this diagram to the green side we begin to use data to better understand the customer. Jumping over the “blue line” represents a major cultural shift in perspective for a company. Any company competing in todays data driven economy must become focused on obtaining data that can enrich the customer as much as it optimizes the companies internal operations. It represents a move from merely being more proactive in dispensing customer facing services to becoming more predictive of what’s happening real time inside a device. Understanding how a device impacts the customer environment is critical at this stage. Becoming data and customer focused together enables a true loyal relationship with your customer. These changes represent a major change in self awareness for most companies and can become a big impediment to transformation success if the company culture is not on board!
As companies shift their focus product development and service have to work side by side on predicting major service issues by modeling systems and becoming more predictive. The goal should be to reach perceived zero defects in a device so that customers NEVER HAVE TO CALL for service and can experience close to 100% up time. This is a critical foundational step as devices become more commoditized over time. Innovative customer focused service solutions must become the focus of business transformation efforts and augment traditional features development. Investments need to be balanced differently between new features and enhanced services. Services will lead to better customer engagement and experiences with the devices. Developing a more intimate relationship with the customers is a critical step to being successful in these later stages of transformation. I am of the opinion that data collection should be focused on saving the customers time and should be used to make them more effective at their operations enabling faster paths to their business value. This is very different way of thinking and may pose a problem to historically rigid or strategy challenged organizations. Problem statements for digital efforts in this stage should reflect a customer perspective and priority should be given to features that would help customers perform at a higher level of quality and efficiency.
The largest opportunity space illustrated by the last transformational circle represents the final stage and a collaborative mindset. This stage reaches past the customer and includes gathering and working with other sources of data to become an integral part of an customer facing eco system. Matrix offerings are offerings that fully support and enable the data driven customer environment which is a larger view of the customer and includes adjacent opportunities to a companies current market. In this stage the true market leaders will learn to integrate disparate data sources and work within the marketplace to bring together information that helps the customers succeed at their most complicated enterprise business or personal objectives. This space will take time to evolve and for me its the most difficult and less obvious of the three opportunity spaces. I see consolidators of data emerging today but those players will have difficulty getting cooperation from the current players who desire to own their data. As an example there are data aggregators for social media feeds that have emerged and can provide company specific information that can be used with internal data to get a better view of the customer. In financial markets data aggregators pull together data on clients and provided insights into customer profiles for larger financial institutions these examples are a start but not necessarily customer focused. To me the Amazon Echo “Alexa” functionality is better placed as helping customers with home automation. It has been exciting to watch Alexa and other voice assistants transform our personal life by becoming more and more matrixed as time goes on transforming into a “hub” for controlling many household devices. The voice assistant device started as a gadget that helped me order stuff from Amazon and get easier access to news, music and information when I wanted to. Kind a of a radio Netflix of sorts. Alexa over the last few years has become the house “hub” saving me time for just about everything from catching my shopping and todo lists, playing games and controlling all my smart stuff from almost any manufacturer you can imagine. Amazon did not forget the basics, I can easily order and re-order from Amazon and check when things will arrive. Recently another expansion is taking place and Amazon is joining with automobile companies to expand their reach. This illustrates the matrix principle. The latest car commercial feature an Alexa assistant to help with manual tasks while driving, this is a marriage of voice data, technology and “skills” to make the driving experience even richer and safer by keeping peoples hands on the wheel. I had to admit I thought about trading in my car because Alexa seems to be the hub of the future! These are all examples of “matrixed” offerings in my opinion and an indication of things to come for all devices.
Technology is advancing at a break neck pace and Block chain is another step towards matrix offerings. Block chain will change the dynamics of marketplaces as companies coordinate exchanges based on data to benefit end customer value. As company perspectives change and become focused on the customers these kinds of eco-systems will become more prevalent because customers will become less and less tolerant of lock in schemes and expect marketplace players to agree to standards to make their operations more effective. Amazon Web Services, Google and Microsoft are working hard and positioning themselves to become the data aggregators making sure all enterprises have a place to park their data to facilitate these kinds of eco-system exchanges. They have made it easy to collect, exchange, aggregate, report on and analyze data and they will be become very powerful matrix enablers for informing adaptive applications. When 5G arrives on the scene even more devices will become connected driving more and more opportunities to leverage data for matrixed offerings.
I hope these initial blog articles help to explain and position my perspectives on the stages of Digital Transformation. These are some perspectives explaining what is unfolding before us and hopefully helps you explore the possibilities that exist in your market. I would love to hear your thoughts and ideas on these stages of transformation and what they mean to you and your company. Learning and sharing is what makes connectivity so powerful and drives innovation! This is a really exciting time to be in industry and it will become an historically significant moment as the world transforms! There are a lot of moving parts so having conversation about how this will all materialize is really fun and exciting! Thank you for taking the time to read this blog and please help me learn through comments and observations. Perspectives are ones greatest teacher and I would like to hear from you.