4 Myths and Realities of Digital Transformation
What does digital transformation mean?
Digital transformation is closely linked with digital disruption. Disruption means that the business that we have today basically becomes redundant tomorrow, and we have to change what we are doing.
Why is it that existing players seem to fall flat on their face when they are faced with disruption?. Well, I’d like to unpack a couple of myths that are frequently heard when talking about disruption.
Myth 1: Disruption hits you like a Tsunami.
Most people feel its a sudden event, big, its done and you’re over it!.
Airbnb is one of these disruptive players that we always hear about. Have they hit the hotel industry like a tsunami?, infact I checked the financial numbers of one of the biggest hotel players in Europe, they have increased their market cap in the last 5 years by 50%. Airbnb started in 2008 and has there has been a gradual evolution of its business model into what it is today. Maybe one of the biggest myth about disruption is that you feel the effects immediately, and if you don’t then it must be a sign that you’re not being disrupted and you’re fine. well, maybe you are not, maybe you just don’t see it yet, because that disruptive change might not be happening in the core of the market, change happens at the edges just like snow melts at the edges, this is where you should be watchful.
Myth 2: Everyone Loves Disruption.
People feel that tomorrow when we have a major digital disruption, we will all welcome it and be happy, we think that all of us are flocking to the Ubers and airbnb of this world. Well, sometimes the market may love disruption sometimes not, sometimes the customers may like it, sometimes they may not. Most times the first reaction to disruption might be a fight back.
The Taxi industry went into a full protection mode when Uber came into the scene and disrupt the market with its technology, with taxi drivers carrying out different protests and strikes.
Aero tv streaming service set out to improve customer experience with the use of cloud-based antenna technology also had to halt their operations as a result of the supreme courts ruling against them. Change has a way of making people feel they have lost control as it interferes with autonomy making some resist such change.
Myth 3: Digital Transformation means new technology.
This is not entirely true. Digital transformation is about changing the way we work through the new organisation culture or customer experience. Its about changing our mindset and behaviour to leverage on new opportunities and not only about changing technology. Most times digital transformation starts with unhappy customers, it is customer driven before being tech driven
We are to be inspired by technology and not pressured by it. It is key to focus on developing and growing your business. Disruption and digital transformation will happen as you grow but take time to be observant and not allow the opportunity pass you by.
Myth 4: Your future disruptive business model is a brainstorm away
The reality is that you try what was on the flip chart and it doesn’t work and you try something else and it doesn’t work and then it works just a little bit until you’ve found what it seems to be the recipe that actually works.
When you look at most of these cases, Netflix for example, when you look at their history at how they did not start with a smash hit but you see their business model that was shaky. Netflix infact started by sending DVD’s by post one by one where you have to order and have it sent. That didn’t work at all, it was only when they changed it that it started to work.
The future disruptive business model might not just be a brainstorm away but series of brainstorms away, just like the case of netflix and airbnb for example.
What other Digital Transformation myths have you heard?.
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