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01.05.2020 Business Briefing

Harriet Nicholson
Harriet Nicholson
Head of Strategy 24 Apr 202012 minutes read

A round-up of the most important insights and what they mean for your business.

cut through the noise

With the news cycle on hyperdrive, we know it’s difficult to stay on top of the Covid-19 latest. It’s even more difficult to unpick the significant insights for your business. The Business Briefing is your one-stop shop for the most important insights, with valuable analysis and opinion from our Etch experts. We’ll take you through this week’s latest on the economic outlook, emerging consumer behaviours and the implications for organisational and cultural change. 

WEEKLY DIGEST

Welcome to the latest Etch business briefing. In this snapshot of the week, we wade through the melee of Covid-19 updates, articles and thought pieces so you don’t have to.

So what has happened since our last business briefing? This week has seen Germany continue to slowly ease out of lockdown, New Zealand pare back its toughest social restrictions and some UK restaurant chains tentatively reopen for deliveries and takeaways. While an exit strategy is now on the cards, rising UK traffic data suggests isolation fatigue is settling in. Responding to the rising anxiety and frustration, design agency &Walsh have gone so far as to create a new set of emoji to better capture our collective new reality.

THE QUICK READ

Short on time? Here are this week’s headlines… 

  • Digital transformation moves from buzzword to imperative: Digital transformation is now considered essential for business survival. While almost a quarter of large enterprises are increasing spend in technology, many organisations have been forced to create digital strategies on the fly.
  • Tracking the pace of technological change: Social media, esports, virtual experiences, ecommerce, shopstreaming, digital currency adoption, artificial intelligence and ROBOTs. Yes robots. The pace of technological change over the past few months has been dizzying…and risks distracting businesses from focussing on the most significant areas to drive meaningful digital business change. 
  • Focussing organisational efforts on driving customer value: Combine major technology shifts with companies’ fight for survival, heightened c-suite digital interest and kneejerk digital decision-making and you can end up with incoherent tactics at best or costly technological mishaps at worst. Despite the circumstances, organisations shouldn’t lose sight of the basics – understanding customer needs, planning in increments and reorganising to break down internal silos.

[Accurate as of midday Thursday 30th April]

THE LONG READ

‘Digital transformation’ moves from buzzword to imperative

‘Digital transformation’ – a term ubiquitously disliked here at Etch, has nevertheless been the theme of the week. Despite inevitable budget tightening across the corporate world, Econsultancy and Marketing Week reported 23% of large enterprises have increased their spending, or invested new funds, into technology or infrastructure spending.

That’s hardly surprising, says Rita McGrath in the Harvard Business Review. Necessity is the mother of invention. Faced with a, ‘titanic shift in worker and consumer behaviour’, companies who have put off digital transformation projects in the past are now having to cobble together digital strategies on the fly.

Right, says investment firm Bond. Covid-19 is accelerating pre-existing online to offline trends on a remarkable scale and companies best keep up. According to Bond, the top performing businesses throughout the crisis tend to use cloud-based technology, have an easily discoverable online presence, adopt efficient ways of distributing products to consumers in limit-contact ways, have products that make businesses more digitally efficient and a broad social media presence. It’s bigger than that, argues Martech Today. Digital transformation is no longer a buzzword – it’s an imperative for business survival.

Tracking the pace of technological change

The pace of technological change over the past few months has been dizzying. Zoom now boasts some 300 million users, up from just 12 million late last year. Once a Gen Z darling, social video app TikTok has exploded into the mainstream as the ultimate lockdown boredom buster. According to Sensor Tower, 24 million Brits have the app installed on their phone, with adoption surging by 34% in the first week of lockdown.

Esports have reached near equal status with their traditional forebears, with virtual races replacing traditional Formula 1, NASCAR and NBA sports coverage. New sponsors are betting big, with BMW’s esports spending purportedly nearing the sums it spends on motorsports and golf. If advertisers ever dismissed gaming environments as too niche for media investment, they won’t now. With Coachella cancelled, some 12.3 million viewers turned into see Travis Scott and Kid Cudi’s virtual Fortnite concert last week. As gaming audiences swell under social distancing, lockdown smash hit Animal Crossing has piqued brand interest, from Highsnobiety to Getty Images.

Entire industries have pivoted overnight to provide on-demand and virtual services, raising consumer expectations about virtual services as standard and catalysing shopstreaming behaviours. Ecommerce has become a default for a multitude of categories, not least general merchandise. 

As societies toil with the complexities of monitoring virus spread and enforcing social distancing measures, the role for technology is exacerbated. Anxious to avoid physical contact, expect a decline in cash usage and the accelerated adoption of digital payment platforms. China is starting to trial the first ever state-run digital currency. Artificial intelligence is taking on a new role, not least in supporting governments track virus spread and in enforcing social distancing and mask wearing

And then there are the robots. News broke this week that drones will soon deliver NHS supplies to the Isle of Wight. In Fairfax, Virginia you can already find a fleet of twenty robots making restaurant and grocery deliveries. In China, robots have been disinfecting hospital rooms and carrying infectious samples to laboratories. In Belgium and the Netherlands, robots are helping care home residents keep in touch with family members. Fast Company have gone so far as to call robots ‘the unsung heroes of the Covid-19 crisis.’ 

The future is here and it’s exhausting.

Focussing organisational efforts on driving customer value

But the pace of technological change, while remarkable, can also be distracting. Combine major technology shifts with companies’ fight for survival, heightened c-suite digital interest and on the fly digital decision-making and you can end up with incoherent tactics at best or costly technological mishaps at worst. While we welcome rapid decision making and the desire to experiment, jumping straight into a technological solution without really considering the problem you’re trying to solve, the value it adds for your customer and your organisational capabilities is problematic. 

Quite so, argues Forbes this week. Digital transformation is a ultimately customer-centric initiative. It’s about creating digital experiences that delight customers and make their lives easier, focussing all work and organisational efforts on driving customer value and satisfaction. Now is not the time to shake your customer focus, says PWC. Etch’s Product Design Lead, Nathan Hornby agrees - understanding customer’s behaviours, goals, unmet needs and pain points is imperative, now more than ever. All technology decisions should always be made through the lens of customer value creation.

It’s actually bigger than that, argues Devops.com. Adopting a truly customer-centric approach requires internal cultural change. Silos need to be broken down, development and production teams need to be better aligned with business, operations and support. Companies need to create more collaborative working cultures, improving feedback loops and driving change through positive reinforcement, creating value for both the business and customers.

Exactly, argues Michael Shattuck in his presentation, ‘From 0 to 60: Digital Transformation in the Age of Coronavirus’. Digital transformation isn’t about technology. It’s about unlocking human potential.

It comes down to empathy, says Grit Daily. Empathy for customers, sure, but also empathy for your employees. Right, says Rita McGrath. Adopting a culture of experimentation, underpinned by empowered teams and non-hierarchical, candid communication is key. There’s little point adopting agile ways of working if your company culture doesn’t allow for honest and open discussion about organisational roadblocks.

Making change feasible

Sounds hard? This doesn’t need to be a difficult, multi-month initiative, reassures Jascha Kaykas-Wolff in his presentation ‘Digital Survival. Right Now’. You can start by working with the customer data at your fingertips and setting simple quarterly content, customer experience, data and UX goals.

‘The temptation is to make big ‘bet-the-farm’ moves – and that’s usually wrong…Just because a threat is huge doesn’t mean the response has to be,’ warns the Harvard Business Review. While the existential threat to businesses looms large, incremental approaches to transformation can still represent a smart way forward. Efforts should be focussed on tackling very specific problems, rethinking assumptions, removing immediate internal obstacles, identifying outcomes and progress metrics to roll out into subsequent digitisation projects.

Our view? In the desperate fight for survival, it is easy to panic and forget the basics, like speaking to your customers and understanding their needs. It is also easy, relatively speaking, to mask real problems with technological plasters without considering the role they play in enhancing a customer’s experience and your team’s level of technical skill. It is also easy to get so overwhelmed by the scale of a digitisation challenge that inertia sets in and no meaningful change takes place. To make it palatable, slice up your challenge into bite sized chunks. Think about change in increments. Stay curious about your customers’ needs, frame your problems, and empower a small hybrid team to tackle those problems in stages, experimenting, making mistakes, speaking candidly and learning all the while.

A FEW QUESTIONS TO ASK YOURSELF

 

  • How considered are your digitisation efforts under Covid-19?
  • Do you know exactly how your customers are feeling? What are their unmet needs under Covid-19? Do you know how you can surprise and delight or make their lives simpler?
  • Have you framed your organisation’s challenges effectively? Do you have problem statements to guide current digital priorities and focuses?
  • Are your teams sufficiently skilled to cope with new technological changes taking place under Covid-19? Do they have the support and help they need to succeed?
  • How are you breaking down internal cultural silos to better connect development, design, marketing and business operation talent?
  • How empowered are your teams to make quick decisions? How much ownership do they have over progress metrics and digital experiments?
  • What efforts are you making to create an open company culture that welcomes frank discussion about organisational roadblocks? How does your company react to failed experiments? 

WHAT WE’RE READING 

AND FROM THE ETCH TEAM

  

GET MORE

Every day we will be sharing key business insights on our social channels. Each week we will round up our daily posts into a pivotal weekly digest. And if that’s not enough, we’ll be hosting regular webinars to talk through what it means for your customers, your sector and your business. So, keep an eye out on our social channels for upcoming webinars.

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