3 Strategies for Digital Transformation

More than two-thirds of disruptive innovation comes from established companies. These companies looked at their own businesses and managed to transform them in order to gain competitive advantage. You don't have to be an Uber or Amazon to innovate and that companies that are not digital natives are able to remain competitive in the face of technological changes. Traditional innovative companies are those capable of working in networks, offering a unique experience to customers and investing in assets that no startup would be able to deliver. For an audience of medium-sized business executives, the first step in achieving a digital transformation is to establish a center of excellence. This center should analyze the foundation of the operation, seeing which physical assets make sense for the business, what new skills are needed and it should also start working on an internal structure where it is plausible to err quickly and cheaply. The leader of this center, an executive committed to change, would be responsible for creating a sense of urgency for adaptation in the company. If setting up this center for developing digital transformation strategy is too expensive, it is possible to seek to do this work with partners or consultants. Let the same team takes care of the operation and the day to day of the company be the same charged for implementing innovation strategies. You need to have operational excellence in your left hand and breakthrough in your right hand with different people running each project. That's because incremental innovation is just as important as radical innovation. Once this structure is set up, it is the company's turn to hire and implement digital transformation services. Didactically, we have listed three possible actions for a company to begin its digital transformation.

1) Attack: Make the disruption in your own business

Review and eliminate the part of your business that is not your differential. Past success does not guarantee future success. It is necessary to leverage your assets and brand to create a model that the disruptive ones will not be able to copy. For example, Netflix emerged as a platform for playing content and now spends much less on licensing. Netflix grew up buying content from others, and when it made a lot of money, it started producing its own. Today, it no longer has to just pay for licenses.

2) Keep cannibals among families

If you can't beat competitors, buy them. If done in an integrated and planned way, the acquisition can help the traditional company to obtain the skills of a startup that is not able to develop internally. In the most ideal scenario, companies buy startups and, in parallel, develop their own incubator for new ideas.

3) Business adaptation

This strategy runs through the idea of transforming the company's product or service experience. Something that makes customers connects with the company in addition to the sale itself. Software companies that have been working more on creating platforms that offer services than selling the software itself. For example, think about P&G initiatives to create new services - not just new brands of hygiene or cleaning products.