How to develop a digital transformation strategy that sticks
Knowing what you want in business is one thing; getting it is another. James Scott-Flangan of Tangent says the key to delivery is executable strategy.
![Four red lines mark a target on a grey wall Four red lines mark a target on a grey wall](jpg/execute1a6bc.jpg)
Laddering down from a business vision to a series of KPIs helps to make executable strategy / George Pagan III via Unsplash
The most common cause of failure across digital transformations, from experience, results from the initial transformation strategy not being grounded in business reality or technological possibilities – an idea I explored in this earlier article.
It concludes that agencies, not traditional consultancies, are best placed to take up the mantle in owning end-to-end digital transformation, from strategic definition to technology rollout. Why? In short, because agencies are the ones better placed to understand the realities of delivery.
It’s also our agency’s view that strategies need to be both deliverable and likely to stick despite technological and organizational constraints – not to mention budgetary. We call this ‘executable strategy.’
Cracking the ‘why,’ ‘what’ and ‘how’
It’s important to first consider how you link day-to-day consumer-facing activities to macro business objectives. We’ve seen success in taking a KPI-driven approach, ‘laddering down’ metrics from a central business vision.
These metrics should be as follows. Strategic KPIs: indicators of strategic performance against the mission or value proposition, such as revenue growth in a particular area or cost efficiencies. Marketing KPIs: underlying marketing indicators that drive the strategic metrics, for example, growth in brand awareness or preference. Operational KPIs: measures of how well business ways of working are set up, for example, delivery speed or quality. And, diagnostic KPIs: indicating how key marketing channels perform and run.
It may sound obvious, but the first step in delivering an executable strategy is to start at the top with your business vision and work from there. When working with our clients, we start by asking three questions: Why are you trying to achieve something? What is your overall business vision? And what is your macro-organizational mission and how does this translate into key strategic objectives? These could be increasing revenue in a particular business geography or expanding product portfolio. Strategic KPIs should be set at this stage.
Once the overarching business direction is clear, it’s important to understand how it translates into marketing objectives. These could be to improve brand reputation or to generate brand awareness with a specific audience. Marketing KPIs should be developed at this stage.
When thinking about the ‘what,’ we refer to the specific marketing business capabilities required to deliver upon marketing objectives. Marketing business capabilities are simply the ‘things that you can do as an organization’ – for example, brand and reputation building or lead generation. These capabilities are the building blocks to achieve a given strategy. Marketing KPIs should be delivered upon at this stage.
We break down the delivery, the ‘how,’ into two core layers: the operating model and underlying digital tools and architecture. The digital operating model should be set up to deliver specific use cases in service of each of the business capabilities across product activation and its day-to-day usage and expansion of new features/functionalities. Operational KPIs should be defined against these use cases.
The underlying digital tooling and architecture refer to the specific tools and how they are set up and integrated to deliver the same use cases. Diagnostic KPIs should be defined against the same use cases.
Implementing executable strategy
Now you know your target destination and how it breaks down into a corresponding what and how, the next goal is to ensure it’s delivered incrementally to avoid the fateful big bang/waterfall approach. This is critical as strategy can be made or broken in its execution phase.
A strong partner should be able to advise on all key areas as well as be able to identify what is missing in order to guide your decision-making should there be internal inertia. An actionable roadmap is important, but making a new business strategy a reality can be daunting, not to mention the need for business stakeholder buy-in and investment.
Start by developing a business case that includes route to value, level of investment required and anticipated return on that investment. In a world where capital expenditure decisions are ever scrutinized, this will help cut through with senior leaders. Then review your partnerships, questioning if you have the right support in place for your journey.
A partner who can help you develop the strategy as well as deliver above all else will be much more bought in and more likely to facilitate success. All that’s left is to ask yourself, can you risk going it alone?
Content by The Drum Network member:
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Tangent
From shaping the underlying strategy to refining the final design and build, we create experiences that enhance people’s lives, prioritise sustainable digital...
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