Winning Customer Experiences Everywhere

Digital Transformation Series

1. Building tomorrow's winning enterprise

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Building tomorrow's winning enterprise
“Digital is redefining how The digital world has given rise to
the non-stop, experience-seeking
a business operates,
customer, who knows what
communicates and they’re looking for and when they
competes — disrupting want it. This need to become
business models on a customer-centric is crucial, with
global scale. “ the competitive landscape
already being altered to provide
greater ways to connect brands
with people through the advent
of connected, social and mobile
technology. Those at the
forefront of this significant trend
pave the way to be customer-
experience leaders, embracing
digital is the key to maintaining
relevancy and attaining success
in an experience world with the
customer firmly in the driving
seat of this new world order.
The question is, how can brands
and service providers transform
into a full-integrated, digitally-
empowered business?
Defining Customer-centric
Digital Transformation
Business success today requires
becoming truly digital: from
platform through to a complete
organisational change, with the
customer at the core. Prioritising
CX (customer-experience) will
enable your business to
constantly adapt to the ever
changing needs of your
consumers today and tomorrow.
In addition, products and services
are rapidly being enhanced with
innovative features and
functionality that are data-driven.
Whilst only 33% of companies in
a survey conducted by PwC of
over 2,000 global businesses rate
themselves as being
technologically advanced, this
number jumps to 70% as
companies look ahead to the not
so distant future. By re-imagining
your customer journey with a
strong emphasis on the role that
digital plays in bridging the gap
between all touch-points along
this journey, brands can offer
customers a more personalised
experience across each of these.
Essentially, digital on-boarding
will fundamentally change the
way brands approach this subject
which will in turn influence
market dynamics across multiple
industries.
Here’s what’s driving change:
Growth in Digital Revenue :
Annual increases in digital
revenue are reported as 2.9% on
average, with some businesses
forecasting total increases of
more than 50% over the next five
years(PWC, 2017). PwC estimates
that these totals will exceed
$US493 billion in total revenues
over the next five years across a
multitude of industries surveyed.
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Figure 1: Customer experience leaders outperform the market

6-Year Stock Performance of Customer Experience (CxP)

Leaders vs. Laggards vs. S&P 500 (2007-2012), © 2013 Watermark Consulting

50%

40%

30% Customer
SxP 500
Experience
Cumulative Total Return

20% Index 14.5%

Leaders
10% 43.0%

-10%
CxP Laggards
-20% -33.9%

-30%

-40%
Increase in Customer Loyalty :
Customers value targeted and
personalised experiences,
proving that this trend has a
positive impact on their buying
decisions. Leaders in digital
understand that this change is
not solely about being
technology-led, but rather it is
about thinking, and re-inventing
methods to ensure that they
continue to maintain relevance
when considering the consumers’
ever changing needs. From
creating new experiences aimed
at serving your customers to
meet their wants and needs,
customer-loyalty can be honed
and increased. Research
conducted by Forrester shows a
direct correlation between
customer satisfaction and
revenue gains — illustrated
through higher conversion rates,
repeat purchases and an increase
in word-of-mouth led referrals.
Increase in customer
loyalty
Growth in digital
revenue
Figure 2: Driving factors for customer-centric digital transformation
Cost Reductions : Empowering Employees :
Implementing digital Through this change, new talent
technologies more often than not in the digital field can be
results in cost reductions, attracted to help support and/or
enabling shorter operational lead lead the transformation needed
times, maximised product quality to ensure success. Current
and more efficient omni-channel employees should also be
processes. Businesses are able to empowered to play an active role
reduce costs by 3.6% on average in this change given the
per annum (PWC, 2017). appropriate incentives, training
and tools, in order to pave the
Product and Service Innovation : way towards making the business
successful.
Building a successful digital
strategy through transformation
will require the implementation
of new features based on insights
derived through data-analytics.
Providing fully integrated
solutions through data-collection
and analysis will help brands
more meet the needs of
customers more effectively and
drive a breakthrough in revenue
growth.
Cost reduction
Product and service
innovation
Empowering
Digitally
employees
Transformed
Business
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CCX ON DIGITAL TRANSFORMATION

Modern technology companies that are considered digital only or digital first businesses have come to the
conclusion very early on that data is their product. Whether your company sells a service, a physical product,
or content, your business aims to create value for your customer base — and every interaction with your
product is a measurable amount of value. But the best data-driven companies don’t just passively store and
analyse data, they actively generate actionable insights by running experiments that empower them to take
definitive action from this data to alter the course of their business. The secret to getting value from data is in
experimenting, and if you’re looking to grow your online business, implementing a well-executed, consistent A/
B testing program is not only a competitive edge over your rivals but an absolute necessity in this digital day
and age.

Our way to transform businesses is a unique co-creative approach to help clients disrupt themselves and
adjust to their constantly reshaping markets through innovation and reinvention through experimentation. We
help our clients visualise and develop capabilities in real-time through creating hypothesis, prototyping these
and execute these to garner results that steer their strategic direction.

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 Winning Customer Experiences Everywhere

Digital Transformation Series

Building tomorrow's winning enterprise
 There are significant opportunities for companies to transform into a
3 PILLARS, digitally customer-centric business, yet getting started can be quite
daunting. To understand just how powerful this change is, we have put

7 RULES in place 7 core rules towards successful implementation.

TO SUCCEED

will keep your business ahead. 72% of companies surveyed

1. Focus on customer Journey :
i. Connecting to Customers: a
more personalised approach
Deepening the digital
relationship with your customer
greatly improves customer-
loyalty and in a heavily
competitive environment this is
disrupting the norm. Customers
are looking to be involved in a
more collaborative approach,
such as through co-creation or
customisation, with the sense of
being involved in a personalised
digital experience. The questions
we focus on to help build this
heightened connection with the
customer, is namely - how do
they feel about your online
experience? Do they view the
quality of interactions high and
relevant enough to keep them
coming back?
The ability to target very specific
customer segments, and to
respond rapidly to their changing
demands, establishes that
‘personalised’ approach which
The customer journey should be
as relevant, simple and targeted
as possible. A powerful example
of this is Amazon, priding itself
on being customer-driven and
offering them what they want,
when they want it, and hassle-
free.
ii. Being data-driven to
enhance customer experience
Understanding your customers in
a digital-world is important in
order to enhance customer
service and responsiveness. In
order to build this deep
understanding, data analytics is
one of the most effective and
powerful operations a business
can utilise. In fact, most
customers are willing to share
personal information in exchange
for personalised experiences and
high-quality services(PWC, 2017).
This high access to data in turn
will enable your business to
analyse customer behaviour and
patterns, to better target their
needs and improve products
alongside.
globally are aware and expect
that the correct use of data will
substantially improve the
customer experience. However
when comparing this to the
number of companies that
actually leverage this data to
drive experiences the figures are
surprising, with research showing
that more than half of these
businesses lacking the skills and
competencies to make full use of
this data (KPMG, 2017).
iii. Big investments foresee
bigger outcomes: the time to
act is now
Studies show that within five
years time, advanced
implementation of digital
transformations will become the
key qualifier amongst the
competition, and will most likely
also be the key qualifier for
investment funding(PWC, 2017).
The time to act is now, with early
establishers expecting to see
significant results in cost
reductions and revenue growth.

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 CX
Figure 3: An ecosystem that considers structure, culture and partners
20% of those businesses are
planning on investing further to
over 10% of their annual
revenues within the next five
years, with a total plan across
multiple industries to invest $US
907 billion per annum globally in
digital transformation.
Businesses that lag behind in
digitisation will lose their
competitive advantage and
struggle to regain market share.
It will be extremely difficult for
these organisations to catch up
with those ahead as their internal
business cultures will have
stagnated and will be behind the
curve. Therefore there is no time
to waste to on-board digital
transformation; the companies at
the forefront of these trends will
have a significant advantage over
their competitors within the
digital ecosystem, as well as
higher propensity to acquire
future investment.
2. Prepare your business :
iv. Leadership at the forefront
The biggest challenge for
businesses wanting to establish
digital change isn’t the
technology itself, but rather it is
the people and the associated
PEOPLE
governance that binds these two
elements within a business. Many
companies are faced with a lack
of digital culture and training, this
is equally true for businesses
more advanced in digital
transformation. Commonly there
is an absence of a clear vision
from leadership, combined with
employees missing the core
competencies and skills needed
to run the required technology
and software to power their
digital offering. Building success
from digital change starts with
the company’s Digital IQ, and its
C-level leadership, to define,
communicate and effectively lead
this transformation(PWC, 2017).
v. Invest in the People needed
to drive transformation
Educating employees and
encouraging their learning of
digital transformation will play a
significant role in enabling a
smooth transition of the changes
that are required. ‘The power of
digital’ should be the knowledge
that goes beyond a select few
holding this expertise in the field;
it should be embedded within
the entire organisation from top
to bottom.
Data collected by PwC shows that
two thirds of businesses cite that
PLATFORM
there is a strong need to increase
their data analytics technology
and employee skillset to
effectively boost data analytics
capabilities. A surprising 50% of
these businesses lack a digital
culture, with 38% unclear about
its economic benefit, a further
25% of which have insufficient
talent to move forward, and the
remaining 18% have a slow
expansion of basic infrastructure
technologies. With such
challenges, it is vital for
businesses to educate their
employees and provide
consistent training. External
partnerships have an important
role to play, providing this
technology, training and
expertise to bridge any gaps and
resource deficiencies that a
company may have.
3. Establish a Robust Platform :
vi. The pillars to digital change:
Data Analytics
Data lies at the heart of digital
tData lies at the heart of digital
transformation, but with this
massive flow of information, the
right analytics techniques are
what will make a big difference to
your business’ success.
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Data analytics is becoming an
increasingly important factor in
decision-making, with 83% of
businesses expecting data to
impact their decision-making
processes within five years, yet
only half are currently using it
today. 73% of advanced
digitalised businesses are already
putting it to work, expanding
their use of big data to focus on
market developments and
building strong relationships with
their customers, in order to
improve on and develop new
products and/or services. Yet
nearly half of all companies still
need to develop a robust
platform with mature data
analytics capabilities, with a
staggeringly low 18% being
advanced.
Early birds are more likely to have
already embedded data analytics
within specific departmental
functions (43% of advanced
businesses surveyed), or provide
a dedicated department (24%)
(PWC, 2017). To make full use of
data, companies are requiring a
wide variety of people with high
technical skills, such as data
scientists and algorithm
architects. For some businesses,
outsourcing to external partners
can supplement internal
capabilities with specialists in the
field.
vii. The pillars to digital
change: Digital Trust
This continuous flow of data can
only be fully functional if there is
digital trust in the security of the
business’s data and
communication, as well as
intellectual property. Operational
disruption, regulation and
compliance as well as
cybersecurity issues are amongst
business’ top concerns slowing
down their digital
transformation. A broad use of
data (being collected and
exchanged), does mean more
potential points of entry for an
attacker if security is lagging
behind. As a business,
maintaining this digital trust is a
priority, and your business will
need to take a rigorous approach
to data security, ensuring robust
protection of the company and
clear establishment of data-
integrity.

PUTTING IT ALL INTO PERSPECTIVE

Can you answer those four questions below and provide enough data to support your arguments?

Is the business delighting

Who are the future customers— anywhere and
customers? every time?

Who are the future competitors What will the business

and partners? become?

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