TAKING DIGITAL STRATEGY TO THE NEXT LEVEL STEVE MUYLLE, PHD PROFESSOR & PARTNER
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1 TAKING DIGITAL STRATEGY TO THE NEXT LEVEL STEVE MUYLLE, PHD PROFESSOR & PARTNER
2 NASDAQ - TECH VALUATIONS 2
3 DESIGN THINKING 1. Apply design process to design artifacts beyond physical products: User interface software, user experience, process, service, strategy, ecosystem 2. Design the intervention, which refers to the introduction of the design artifact into the status quo, by applying the principles of rapid prototyping: Introduce solution with purposely lower complexity Incorporate user interaction in every step Iterate in short cycles and improve the artifact Source: Brown, Tim and Roger Martin, Design for Action, Harvard Business Review, pp , Sep
4 DISRUPT JOB MATCHING? 4
5 5 DIGITAL STRATEGY
6 DIGITAL TECHNOLOGIES Digital Technologies (DT) are combinations of: Information Technologies Computing Technologies Communication Technologies Connectivity Technologies (Source: Bharadwaj et al. 2013) 6
7 DIGITAL TECHNOLOGIES (Source: Brynjolfsson E. and McAfee A The Second Machine Age. W. W. Norton & Company. p. 48.) 7
8 DIGITAL TECHNOLOGIES (Source: Brynjolfsson E. and McAfee A The Second Machine Age. W. W. Norton & Company. p. 48.) 8
9 STRATEGY Strategy is the creation of a unique and valuable position, involving a different set of activities. Crafting market strategy is the process of studying how to exploit a business s resources to achieve short-term and long-term marketplace success, deciding on a course of action to pursue, and flexibly updating it as learning occurs during implementation. (Source: Porter 1996; Anderson et al. 2009) 9
10 DIGITAL STRATEGY Digital Strategy is organizational strategy formulated and executed by leveraging digital technologies to drive organizational performance. (Source: adapted from Bharadwaj et al. 2013) 10
11 DIGITAL STRATEGY KEY TECH TRENDS Analytics - Big Data Cloud Computing Cognitive Computing Internet of Things Mobile - Social KEY MARKET SHIFTS Customer Behavior Digitization of Products New Business Models Redefined Ecosystems DIGITAL STRATEGY Contexts Modes Processes Organizational Performance (Source: adapted from Bharadwaj et al. 2013) 11
12 12 TECH TRENDS
13 ANALYTICS BIG DATA Decide.com (acquired by ebay; shut down Sep 30, 2013) Web site (and mobile app) Price Alerts: We'll notify you the moment the price of a product you want drops Online and Nearby Pricing: Get the best price whether it's in-store or online Price Predictions: Find out whether the price is going down or up Price Guarantee: If our predictions are wrong, we'll pay you the difference 13
14 CLOUD COMPUTING We seek to be Earth s most customer-centric company for four primary customer sets: consumers, sellers, enterprises, and content creators. - Jeffrey P. Bezos Founder and Chief Executive Officer Amazon.com, Inc. 14
15 COGNITIVE COMPUTING 15
16 INTERNET OF THINGS Smappee 16
17 MOBILE 17
18 SOCIAL MEDIA AS 2-SIDED PLATFORMS (Source: Cusumano 2010) 18
19 SOCIAL MEDIA 19 Prof Dr Amit Basu - Prof Dr Steve Muylle Willem Standaert
20 20 MARKET SHIFTS
21 CUSTOMER BEHAVIOR 21
22 DIGITIZATION OF PRODUCTS New products Adding information features Selling information as a product Selling knowledge as a product 22
23 DIGITIZATION OF PRODUCTS Source: Stefaan De Moor, Service Director, Siemens NV, 23
24 NET PROMOTER SCORE Source: 24
25 TOP NPS US USAA - Insurance = 80% USAA - Banking = 78% Costco = 78% Apple - Laptop = 76% Dillards = 75% Nordstrom = 75% Apple - iphone = 70% Amazon = 69% Southwest Airlines = 66% Apple - ipad = 65% Source: Promoter-Scores-NPS-for-2013 Update for 2014 : 25
26 NEW BUSINESS MODELS 26
27 REDEFINED ECOSYSTEMS 27
28 28 PLAN
29 DIGITAL STRATEGY KEY TECH TRENDS Analytics - Big Data Cloud Computing Cognitive Computing Internet of Things Mobile - Social KEY MARKET SHIFTS Customer Behavior Digitization of Products New Business Models Redefined Ecosystems DIGITAL STRATEGY Contexts Modes Processes Organizational Performance (Source: adapted from Bharadwaj et al. 2013) 29
30 ORGANIZATIONAL DNA FOR STRATEGIC INNOVATION Source: Vijay Govindarajan and Chris Trimble, Organizational DNA for Strategic Innovation, California Management Review, Vol. 47, No. 3, pp , Spring
31 SPIN-OFFS 31
32 INNOVATION WITHIN EXISTING BUSINESS MODEL 32
33 STRATEGIC EXPERIMENTS 33
34 DIGITAL TRANSFORMATION Transformation A: Reposition the core business, adapting to the altered marketplace Transformation B: Create a separate, disruptive business to become the next source of growth Capabilities exchange : Establish a new organizational process that allows the two transformation efforts to share resources without intervening with each other s operations Source: Gilbert, Clark, Matthew Eyring, Richard N. Foster, Two Routes to Resilience, Harvard Business Review, pp. 3-9, Dec
35 DISRUPT JOB MATCHING? 35
36 DISRUPT JOB MATCHING? 36
37 PRIORITIZATION STRATEGIC BUDGETING? Worth Building Worth Exploring Value Unattractive Cost 37
38 38 TAKE AWAY
39 TAKE AWAY Tech firms that try to disrupt established industries attract lots of buzz, capital and talent. The incumbent firm response should not be just about MVP, agile sprints, and user participation. Incumbent firms can take their digital strategies to the next level by Closely monitoring and purposefully embedding key shifts in technologies and markets. Crafting new business models that forget and/or borrow. Piloting new ecosystems as platform leaders. The end game is to drive organizational performance. 39 Amit Basu & Steve Muylle
40 THANK YOU! Steve Muylle, PhD Professor & Partner Contact Connect
TAKING DIGITAL STRATEGY TO THE NEXT LEVEL STEVE MUYLLE, PHD FULL PROFESSOR & PARTNER
TAKING DIGITAL STRATEGY TO THE NEXT LEVEL STEVE MUYLLE, PHD FULL PROFESSOR & PARTNER NASDAQ 2 Listen to the lab coats, not the suits. And get the lab coats to produce prototypes, not slideware. 3 JOB MATCHING
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