Everything and everyone is impacted by our increasingly-connected world. Each year we have new platforms, new devices, and new ways to connect and interact with each other. Not only is digital transformation changing the way we lead our day-to-day lives, it is also profoundly impacting how businesses around the world function and compete with one another.
Every business is in some stage of transformation. Digital change does not just mean ripping out existing physical systems and replacing them with digital ones. Instead, it means a convergence of the past and the future, the physical and the digital. At its core, digital transformation is about creating experiences that are personalized, intuitive and exemplary. It is radically transforming how companies engage with both their workforces and their customers.
With the rise of on-demand services and online giants, consumers increasingly expect experiences tailored to their needs and preferences. It is no longer acceptable to merely provide a product or service at a fair price point. Instead, consumers are turning to digital channels to source and engage with brands. According to research from McKinsey, “Three-quarters of online customers said they expected help within five minutes, have used comparison services for consumer goods and trusted online reviews as much as personal recommendations.”
The reason digital transformation should be top of mind for business leaders is because the components that make up digital transformation are exactly what drives customer engagement. Businesses are now expected to truly know their customers – not just what they buy, but the context surrounding that purchase, like its location or intent – and to use this intelligence to personalize the experience and make it relevant. A more personalized customer experience means more engaged customers, and that maximizes financial returns for the company. The more customers are engaged, the more they’re likely to spend, boosting revenue and bolstering a company’s standing among its competitors.
Talent management and culture
The same people who are connected consumers are also connected employees. The workplace environment must accommodate that reality in order to build and retain talent. According to Deloitte, to compete for the best people, companies must provide “progressive and innovative environments that top candidates now expect.”
As technology and connected devices have provided customers the freedom to select goods and services at their hyper-tailored discretion, it has offered employees the flexibility to work away from their computers. Deloitte reported that 64 percent of employees would choose a lower-paying job if they had the flexibility to work away from the office. And, just as consumers are more likely to return to a brand with strong digital engagement, companies that increase employee engagement see a corresponding increase in employee retention, by up to 87 percent.
By deepening the engagement with employees through digital and physical channels, businesses offer the flexibility and personalization that employees have come to expect as consumers.
Innovation & emerging business models
As technology continues to advance, that opens up more and more channels for innovation. Today, even the biggest corporations must think like a start-up and re-evaluate its existing business models to meet and anticipate changing needs.
When faced with disruption, many companies have typically not chosen the path of innovation for fear of cannibalizing their profits. The World Economic Forum cites Apple’s launch of the iPod and iTunes, and eventually the iPhone, as a positive example of how a company can successfully innovate and take risks when faced with disruption.
This is exactly what we’ve been doing at Pitney Bowes. We transformed mail in our first century, and in our second we are transforming our own business to help clients succeed in the physical and digital worlds of commerce. And this process began by examining the company’s true north—the vision, values and services that defined the organization and then building on that foundation. Today, Pitney Bowes combines the strength of physical mail and shipping with digital experiences to simplify the process and make lives easier for senders, receivers, and those in between.
Technology and connected devices will only continue to grow in widespread adoption and sophistication. Business leaders would be remiss to take their current products and services for granted. Instead, they must look forward as much as Steve Jobs did for the iPod, anticipate where their industry is going, and make the tough changes demanded by this new environment.
Michael Monahan is Executive Vice President and Chief Operating Officer of Pitney Bowes.