It is no surprise that being first is a competitive advantage. For hundreds of years farmers wanted to be the first to market in order to get the best prices. Ships, trains, and planes have all promoted how fast they can deliver cargo and passengers. In the news industry, every news outlet wants to be the first to bring us “breaking news.” Even in retail, the first store to offer the “next big thing” will sell out at premium prices. Speed is a competitive advantage.
One major benefit cited by organizations undergoing a digital transformation is speed. Processes have shortened cycle times, decisions are made quicker, and customers are served faster. The digital transformation initiatives and projects are the means to achieve speed. During the past two years I have been involved with six organizations that have adopted elements of digital transformation. A major benefit has been speed. Each organization was at different stages in their digital journey, but each found a speed advantage. In some cases, speed was not a driving force for the initiative or project, but it was an unintended consequence. While each of these organizations is quite different, the result has been a competitive advantage due to their digital transformation actions.
The Financial Services Company
This organization is a mid-sized regional credit union with branches across several states within the USA. It prided itself on connecting with the local community through friendly personal service. However, customers were increasing their use of the online banking tools, which were not up to industry standards. In addition, many banking procedures required a visit to the branch office and interacting with a teller or other associate. The organization embarked on a digital transformation initiative and chartered eight projects for converting various manual processes into digitally enhanced processes.
While completing these projects, we first mapped the processes to identify wasted time and effort. A new process flow was created based upon meeting the customer’s needs for speed, easy to understand interface, and personal data security. Once the new processes were determined, we incorporated available digital tools and applications to convert to the new processes. A key element of the project was training the associates and ensuring the organization was prepared to support the new processes. The result was order of magnitude reduction in time to complete routine banking actions and much faster response for customers facing problems such as lost credit cards.
The Medical Device Manufacturer
This organization is a global company that holds a dominant position in the market for certain medical test and analysis equipment. The company’s success has been based upon its innovative designs and reliable system performance. However, for years the executive staff has complaint that product development takes too long. The R&D department provided excuses that the systems were very complex combining leading edge hardware, software, and chemical analytics into one system. Also, they pointed out that regulatory approval required extensive testing and documentation. However, even with those considerations, the design and development process took a very long time.
This organization had been a leader in adopting digital technologies in its product designs. However, they were slow to leverage digital technologies in the process of product development. The world-wide pandemic changed that. Scientists and engineers could not fly all around the globe for design meetings. In fact, many of them could not even come into their office or the laboratory. The organization was forced to rapidly adopt virtual meeting tools and digital techniques to automate what were formerly manual processes. Getting the organization to buy into the changes was not hard since they needed to make these changes just to survive. The surprise by the executive management team has been the acceleration of product development projects. The virtual workforce was not wasting time on airplanes and delaying meetings because one person was out of town. With virtual workspace and process automation, these were no longer challenges and there has been a significant reduction in time to complete the product development milestones.
The Government Agency
This organization is a major department in a federal government agency. The organization provides information, policy recommendations and services to state governments, academia, and industry associations. The agency has a good reputation for the quality of their work, but their pace of change and adoption of new technology is slow. It often takes years for the agency to collect and analyze data. Which means that their policy recommendations are seldom helpful with respect to real-time issues. There were some leaders in the organization who believed that digitally transforming aspects of their work would both improve the output and lower the cost. However, convincing the funding entities of that was difficult.
The organization’s leaders decided to start a digital transformation initiative. Since one of the sharpest complaints about their services was that it took years for them to complete as study, they prioritized rapid response and turnaround time for requests in their digital transformation strategy. It was possible to reduce response times for analysis from years to months by incorporating off-the-shelf digital tools and analytics. Some of the employees had initially been concerned that the organization would become an “IT department.” Once the ability to rapidly respond and address critical issues currently affecting society was understood, the employees were onboard with the transformation activities.
The High-Tech Giant
This organization is a leading high-tech giant. Many people consider them to be a global digital leader. And with respect to serving their customers, they are a digital leader. However, there is one division within the organization that is involved in the design and manufacture of electro-mechanical devices used by this organization in many of their facilities. Sometimes these devices would break down and create errors and problems. The department responsible for the design, manufacture, and service of these systems employed traditional processes for problem solving and problem resolution.
The organization responsible for these systems recognized the need to reduce the time to respond to internal problems. They embarked on an initiative to empower the employees with digital tools and systems to quickly isolate the root causes of the problems and fix them. In this digital transformation initiative, the solution was not new hardware or technology, rather it was to leverage existing data and analytics to support rapid response and issue resolution. These changed empowered the employees to make the correct technical and business decisions that eliminated the root causes of problems.
This organization is a non-profit that provides services for individuals with unique needs and interests. The organization is focused on providing services within a geographical area. Like many non-profit organizations, their emphasis was on serving those in need, not on incorporating leading edge technology. Most of their processes and systems were manual and relied on one-on-one personal meetings. The organization had a good reputation for friendly, helpful service and many of the counselors were resistant to technology changes, fearing that they would lose the personal touch with those they served.
The organization’s leadership team determine on a strategy of digital transformation. The internal processes were put online, the records were digitized, and many of the manual “back office” activities were automated. The final technical change was to implement a new communication system allowing the counselors to connect with those they serve from anywhere and at anytime. These systems allowed the counselors to provide services in real-time over the phone or virtual meeting, rather than scheduling a visit and waiting sometimes weeks to meet in person. The final systems came online in early 2020, just as the pandemic arrived. The demand for services skyrocketed and the organization was immediately able to respond when similar organization in other regions were brought to their knees. Not only did this organization meet the needs of those they served, their response time was also much faster than in past allowing them to serve many more people without an increase is staff or facilities.
The Major Retail Chain
This organization has hundreds of stores throughout the USA and is growing rapidly. It has a continuing need for new store owner/operators. The training program for new owner/operators was a many-months long program involving both classroom and on-the-job training at existing stores. Not only was the training program long and expensive, the results were also inconsistent. Some graduates were very well-prepared while others were not. The organization’s executive management team considered this training to be one of the strategic business processes and initiated a major overhaul of the process. A key focus for the process was to improve the quality of the training while significantly reducing the training time.
In order to accomplish this improvement, the team charged with overhauling the training program digitally transformed the training. The team used off-the-shelf digital tools that could be quickly and simply customized to their unique retail operations. These tools allow the organization to rapidly scale up or scale down their training to meet business demands. The core training time was reduced by 50% which reduces the time from a prospective owner/operator starts the program until they are operating their own store by 30%. The digital tools have improved analytics to track progress and quickly identify those who are struggling with the training. In addition, the tools create an action-learning environment and are adapted to adult learning styles leading to a more effective learning environment.
Digital Transformation and Speed
There are many facets to a successful digital transformation initiative. There is of course the technology. But in addition, there are impacts to the customer experience, redesign of operational systems and processes, commitment by senior leadership and buy-in required by the employees and staff. As we can see from these examples, digital transformation projects can be very different from organization to organization. But a consistent impact is speed. Faster processes, more responsive customer service, and better decision-making. These benefits will directly correlate with organizational survival and ultimately competitive advantage.
Raymond Sheen, PMP® LSS BB, is president and founder of Product & Process Innovation, Inc. He is a veteran business leader with over 30 years of executive, engineering management, and project management experience deploying new technology and improving business performance. He has consulted and trained companies in various industries and business functions including marketing, engineering, manufacturing, service, IT, and Finance. Ray is author of the book, Guide to Building Your Business Case, published by Harvard Business Review Press. Ray received his B.S. in Mechanical Engineering from the United States Air Force Academy and his M.S. in Astronautical Engineering from the Massachusetts Institute of Technology and has a graduate certificate in Digital Leadership and Strategy from Boston University.