CDO role declared ‘Transformer in chief’

This insightful report from McKinsey&Co, says “the CDO is now a transformer in chief, charged with coordinating and managing comprehensive changes that address everything from updating how a company works to building out entirely new businesses. And he or she must make progress quickly.

Well, not only must we wholeheartedly agree, but that’s what Transform has been helping CDOs (and CIOs, CMOs, Commercial Directors, Digital Directors and the like) with since we started out back in the nineties. What we actually see increasingly is that the demand on the CDO (or equivalent) basically continues to extend through the spectrum from strategy, through design and into delivery. Those that are most effective and making the most positive impact on their organisations are taking a customer-centred approach and not only do they design and deliver services for those customers, but behind that they are also leading in design and delivery of new capabilities across their organisation. So I can’t and won’t argue with McKinsey’s five focus areas for CDOs:

  1. Make digital integral to the strategy
  2. Obsess over the customer
  3. Build agility, speed and data
  4. Extend networks
  5. Get stuff done

In fact we’re wondering if McKinsey has been peaking over our shoulders whilst we’ve been working with clients. That’s not a bad list, but on the other hand it’s a massive brief.

Digital transformation

The pressure is on; as customers rapidly adapt to the digital world at their fingertips and as organisations adopt new technologies in the scramble to keep up with new competitors emerging all over the place. Hence the growing debate about the value of a new addition to the boardroom / executive management team: the CDO. Some pundits (and plenty of headhunters) insist a CDO is vital to push through rapid change in organisations that have been slow to embrace the new opportunities and threats presented by digital disruption. They argue that CDOs often need to be parachuted into situations where others in the executive team lack the necessary skillset or firepower to implement digital transformation. Others believe CDOs are needed to bring a new understanding and perspective to the digital challenge, to evangelise digital thinking and to apply it across the whole business.

Is it a bird? Is it a plane? No it’s the CDO

If we step back from this for a moment, we could say that what they are really describing as a CDO could also be called CETNtCaaRoDO (Chief Everything That Needs to Change as a Result of Digital Officer) – or CBtCit21CO (Chief Bring the Company into the 21st Century Officer). Neither of which is particularly snappy though.

The role is effectively re-orienting the whole business around the customer, while aligning the organisation behind this change, and making it everyone’s job. Which is hard when it involves changing the way the organisation does things, and when the CDO is often seen as CEO in waiting.

Realistically, you’ve got to admit that in all five areas listed above, the individual responsible needs a rare combination of analysis, communication and change skills. Very rare in individuals. Even more elusive in organisations faced with a transformation challenge.

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Digital Transformation: Making it work for your business and your customers

I was invited recently to speak at an event in BBC Centre hosted by IIBA UK with BBC Academy. My brief was to talk about some of the challenges organisations typically face in keeping up with rapidly evolving customer expectations while still delivering on commercial priorities: Making it work for the business and its customers. It went something like this…

Transform started out at the very end of the 20th century. We found our way in the places where business and technology collide, working with large organisations looking to respond to change. Helping IT Directors and Commercial or Marketing Directors, doing the things that a CDO might do today.

We built a flexible business, with an associate model at its core, designed so that we would always have access to the best talent for every client project.

When we started out the internet was disrupting big business and the services our clients want from us have evolved; we’ve seen changes in business demand because of changes in customer demand.

Customers don’t exist within a digital only world. They move between digital and physical channels placing digital in the broader omnichannel context. Our annual research into digital maturity highlights the importance of the digital ecosystem. Organisations that operate the 5 areas of strategy, culture, technology, channels and customers as an ecosystem, rather than a hierarchy, are more likely to think beyond just the front-end customer experience or the channel strategy. This is the key to a successful transformation.

At Transform we talk a lot about being customer-centred but what does that mean in reality?

  1. Customer-centred design If we design services with an approach that is truly customer-centred we will understand the impact our actions have on the customer and therefore the outcome.
  2. Customer-centred organisation It needs a customer strategy embedded from the top to the bottom of the organisation, activated at every stage of the process, not just the customer facing experience.

We need an understanding of customer wants, needs, attitudes and behaviours in relation to our organisation to design services, propositions and experiences that work for the organisation and the customer.

What questions might we ask:

  • How can we put customers at the heart of the design process?
  • How do we get the most out of our business infrastructure and capability?
  • Who are the current and target customers (including functional needs, motivations and behaviours)?
  • Which customers will drive the best commercial performance?
  • Where are customers least well served and what are the areas where we can delight them?
  • What are the key missions and journeys that we can own and excel at?
  • What are the propositions that are required to support the experiences & respond to customer needs?

And what does all of this mean in terms of delivery?

At Transform we talk about Strategy | Design | Delivery – in other words Think | Plan | Do.

An effective approach requires a clear link from strategy to action:

  • Strategic priorities that set out your approach to customer, channel, platform and product
  • Experiences & propositions you offer to your customers, colleagues and other stakeholders
  • The capabilities (people, processes, content and systems) you need to deliver them supported by detailed business cases
  • A Roadmap that sets out the plan for change

Leading transformation is a broader challenge. It means getting the right plan and delivering what’s on the roadmap. But it also means taking the organisation on a change journey. This is where progress checking the digital ecosystem can keep you on track for success.

And in a world where the rate of change is accelerating all the time, how do you adapt? Having continuous insight is essential although it can be a tough thing to do. Our DMI report is now in its 6th year and with 5 years of data behind it we’ve been building the topic and defining the key themes. It keeps us, and our clients, on track and up to date with what’s changing.

DMI 2015 will be available in the autumn. I’m already intrigued to see how the trends have developed but I’m confident that the digital ecosystem will still be at its core.

To see a copy of Bill’s presentation please click here

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Have you heard of the Internet Of Things?

I invited Andy Hobsbawm, old friend and founder of IOT trailblazer EVERYTHNG to come and talk to Engine group.


Have you heard of the ‘Internet of Things’?

If you haven’t – it’s the next big thing in digital.

At Transform we’re always hungry to understand the long-term potential of disruptive developments and excited about uncovering the best ways to embrace them. So, despite it being All Hallows’ Eve, we joined our colleagues from the other Engine agencies in the Innovation Labs to learn all about it. Hosted by Engine’s Chief Digital Officer, Alex Balfour (the man who plugged the Olympics into the internet), we took our seats to listen to serial entrepreneur Andy Hobsbawm who is a pioneer in the Internet of Things (IoT).

Andy is a digital legend; here are three cool facts about him:

  1. He founded Online Magic – responsible for developing the first website to cover a British general election. Online Magic was later acquired by Omnicom.
  2. He is a member of the British Interactive Media Association’s Digital Hall of Fame.
  3. Instead of going to university, after leaving school he joined a rock band.

And as if that isn’t enough, he is the founder of EVRYTHNG, a groundbreaking company and one of the biggest IoT software companies around.

So what is this Internet of Things?

  • In short, it’s about making any product smart, personal and social by connecting it to the web.
  • In theory, it means that everyday objects become part of a network combining the worlds of digital and physical.
  • In practice, your mobile phone could talk to your car, your t-shirt could talk to your washing machine and your kettle could even end up ordering more teabags when you’re running low.

The idea behind it is to connect some of the 3.3 billion everyday products sold each year to the real-time web, enabling communication with them. Tiny, cheap and self-powered microchips connected to your home Wi-Fi would make it possible for your home appliances to send you reminders when maintenance is required. But with over half of the world’s population now in possession of a smartphone you could use smart software to connect any simple, everyday product with your smartphone, turning it into a real-time, personalised digital service.

Consumers vs. businesses

As a customer, you’ll be able to unlock the digital features and experiences of the things you use: helpful functionality (e.g. interactive manuals), additional services (e.g. insurance) and the ability to share and communicate (e.g. product suggestions). Your broken washing machine could automatically e-mail the best-rated technician in the local area, listing the broken parts and suggesting a visit when your calendar says you’re free. And if someone buys it from you, they’d be able to see that it has a brand new part in it.

As a business, every single one of your products becomes a dynamic Owned Media Platform and a source of real-time data about people’s lives. It raises a whole host of new possibilities for brands and marketers through exciting new channels for customer engagement and the data gathered should be analysed and utilised to delight unique customers through customised communication.

How futuristic is this?

All that may sound pie in the sky but just to give you an idea of what we are talking about, by 2020:

  • Think tank IDATE predicts 80 billion objects to be connected
  • And research firm Gartner estimates it to be a $300 billion industry

And this is just six years away. But there are opportunities for uses that we may be less excited about. Imagine how happy the NSA will be when they can simply Google our socks to see our precise movement profile. And Microsoft’s plan to establish a digital neighbourhood watch with door sensors that know when we are in, or out, might not make us feel any safer.

But the upsides could be huge. The Internet of Things is expected to bring massive benefits in terms of mass personalisation and customisation, reduced time to market and extra customers. It has the potential to radically improve the current, wasteful processes in which companies produce and market goods. It can make global trade more efficient via better resource allocation through direct and traceable links from design, through distribution to the end-customer. Which also makes it green, not to mention all those smart thermostats that prevent your boiler from heating water for your morning shower when you’re on a business trip. Storing information on the origin of components, place of manufacture and proof of authenticity adds an increasingly vital ethical dimension.

This trend will probably leave many people feeling somewhere between shocked and inspired. And this is the reason why businesses must take the lead and shape this development in a way that doesn’t ignore customers or scare them off by the intrusion of tech and brands in their lives. They must implement it in a way that tangibly improves people’s day-to-day experience with products and services, whilst fully protecting their privacy.

Getting it wrong could mean irreparable reputational damage.

Getting there too slowly could mean losing people’s custom to nimble new players as increasing digitisation accelerates a technology-driven start-up environment.

Getting it right could mean a nice slice of the $300 billion cake.

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It’s all about the digital ecosystem; DMI2014

By Joe Tarragano, Transform UK

Five years on, it’s no surprise that the digital landscape has moved on significantly since we first published our Digital Maturity Index (DMI) back in 2010.

Today we’re delighted to be publishing our findings in DMI 2014 : The digital ecosystem of technology, channels, customers, strategy and culture and the insights in this year’s report show just how far organisations have come in the intervening years.

Based on interviews with over 200 consumers and 150 business leaders from a range of industry sectors, this year’s report also includes opinion pieces from five digital thought leaders:

  • Kathy Settle, Director for Digital Policy and Departmental Engagement, Government Digital Service
  • Alex Balfour, Chief Digital Officer, Sports Start-Up
  • Dr Nicola Millard, Customer Experience Futurologist, BT
  • Professor Moira Clark, Professor of Strategic Marketing, Henley Business School
  • Dave Coplin, Chief Envisioning Officer, Microsoft

Our MD, Emma Robertson, unveiled DMI 2014 with clients at our annual launch event in London. She talked though some of the headline findings building on the principle that as digital becomes more integral to the underlying strategy, the component parts of digital maturity must be treated as an ecosystem, not a hierarchy. The focus this year is about smartly combining technology, channels, customers, strategy and culture for both customer and commercial benefit. Here are just a few of the headlines:

Technology: In 2012, 87% of organisations had no formal processes for innovation. By 2014, 67% of organisations are using hackathons, labs or open APIs.

Channels: The drive to establish a digital presence in every new channel that emerges is being replaced by more strategic behaviour with 66% focusing on consolidation of existing channels and only 34% looking to grow the number of channels on offer.

Customers: 53% of respondents now measure customer happiness as a way of assessing how well digital channels are performing; 66% use a customer satisfaction index.

Strategy: 65% of respondents reported that there is a digital vision and strategy within their organisation but just 8% stated that the strategy is very well known within their organisation.

Culture: A factor in creating an environment for change and innovation is in an organisation’s tolerance for failure. Only 15% of organisations were recognised as having a ‘fail fast’ culture.

You can read the full report here or you can drop us an email if you’d like us to email you a copy.

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The rise of the Chief Digital Officer (CDO), or is it?

It’s a simple reality that too many boardrooms lack digitally savvy leadership. Our own research – DMI 2013: Creating True Customer Centred Services – certainly shows this and indeed we asked the question ‘How long until Chief Digital Officer, with a mandate to drive digital transformation, is a common title in organisational structures?

This is also highlighted in a recent article by Odgers Berndtson, with research showing that less than 7% of boards use data from social and mobile networks; only 33% of CEOs use social channels and only 12% of a survey of Fortune 500 executives identified social media as critical despite the University of California finding that Twitter is a source of early indicators of stock price movement for investors. This report makes the point that “Many companies will start hiring Chief Digital Officers (CDOs), but if the company is not fully committed and the CDO is not fully supported, the hire will become nothing more than a figurehead who will serve as an internal ambassador for digital. Companies must understand the purpose of hiring the right digital talent. And talent means an entire team and more than one digital director.”

Gartner predicts that by 2015 we will see a CDO in 25% of large global organisations, and that these are the leaders who will guide organisations through the age of digital and the data challenges associated with it. When I read this report I felt instinctively that this trend is real, in fact we can see the evidence amongst Transform’s client base with a clear and rising recognition for digital leadership in the boardroom.

However, the Gartner report isn’t really telling the story quite the way I thought, because whilst it focuses on the CDO, it’s actually referring to the Chief Data Officer, stating the trend is driven by the growing need to understand how data is to be used in the organisation. So does that means there is no link, and there is no trend in the rise of the Chief Digital Officer?

I believe there are more than enough data points to make the case, and perhaps the two trends are so interlinked and so indicative of a new set of leadership challenges that both are real and present in our organisations. Whilst researching for this I found the same Gartner report being used to promote the case for the rise of the Chief Digital Officer, this time by respected commentator Vala Afshar, via an article in which he introduces some insights from the CDO of Harvard, Perry Hewitt.

So to fill that gap in our boardrooms we can assume the rise of the Chief Digital Officer will be a realistic solution for some organisations, others will fill the gap other ways, but those who ignore it will fall out of step with their customers expectations and fall into decline.

On that note let’s close with some tips from Perry Hewitt, Chief Digital Officer at Harvard.

10 CDO best practices for dealing with digital transformation:

1. Build a high-performance digital team
2. Digital should be everyone’s job
3. Don’t do digital for the sake of digital
4. Do fewer things better
5. Create an atmosphere of collaboration
6. Bake data-informed thinking into the culture
7. Think from the outside-in
8. Sometimes it’s better to beg for forgiveness then ask permission
9. Get experimental and analytical
10. Management needs to live digital

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Who’s taking the digital lead?

Leadership: noun
the action of leading a group of people or an organisation, or the ability to do this: different styles of leadership

Last week I attended the Internet Retailing Conference (IRC 2013), now the biggest etail event in the UK, where the question of leadership was much talked about.

Many of our clients ask the same question: ‘Where in the organisation should the leadership of digital and multi-channel strategy sit?’ and indeed we highlighted it as an issue in our digital maturity research earlier this year; an annual benchmarking study of the readiness and capability of organisations to deliver digital services.

For me the question of how those operating in digital and multi-channel roles feel about the importance of leadership is key. How much influence does digital leadership have on the success of the business and how influential do they feel within their own organisations?

At IRC 2013, Tanya Lawler, Vice President of UK Trading at ebay, challenged the audience with a view that retail organisations shouldn’t have a multi-channel director. Her opinion being that because customers already think in terms of multi-channel, it’s the responsibility of everyone in the company to think multi-channel too, not the role of one person.

However DMI 2013 found that 66% of the organisations we spoke to said digital leadership was an important role for them. It is of little surprise then that this importance is translating into the presence of digital roles among the senior leadership team. More than three-quarters of those surveyed said their organisation has a Digital Director role, or equivalent. How long then until Chief Digital Officer, with a mandate to drive digital transformation, is a common title in organisational structures? Recruitment agencies have reported that requests for the role have risen by as much as a third in the EU and US over the last two years.

Despite this positive step change, almost 20% of the leaders we surveyed stated that there wasn’t a digital leader at board level, and 3% outsourced the role completely.

Also speaking was Laura Wade-Gery, Executive Director of Multi-Channel eCommerce at Marks and Spencer, who said she thought the fact that she brings the language of digital into the boardroom, and leads the development of digital skills across the company, is a key part of its success.

As part of DMI we asked business leaders how their organisation makes digital part of its DNA and the results highlighted that digital training and development remain focused on those working in digital roles, with limited priority given to ensuring digital skills are organisation-wide. But take that a step further. How do organisations ensure that every employee recognizes that customer experience is channel independent? Not only do they need to understand how digital channels fit with stores but also how to provide a seamless experience across multi-channels because let’s face it, customers should choose a specific channel because of its relevance at that time, not because the experience is superior to the other channels offered by a brand.

As in previous years, DMI 2013 highlights a substantial gap between consumer expectations and organisational capability. At the heart of the challenge is the notion of the digital silo where distinct channels are managed by different teams, with different strategies, different KPIs and different reward structures. An approach that clearly makes it difficult to deliver a multi-channel experience that is customer-centric.

So whether you subscribe to the view that multi-channel is the responsibility of everyone, or are of the opinion that a digital or multi-channel leader can drive significant value in a business, it’s critical that the customer is at the heart of the strategy.

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Ey up t’tour – Tour de France fever

By Emma Honeybone, Transform UK

This Saturday the 101st Tour de France begins in Leeds as Yorkshire, ok the UK, plays host to the Grand Départ. Nine new cities feature in this year’s tour including Leeds, Harrogate, York, Sheffield and Cambridge – excitement is building and it’s not just in the cycling community. The legacy of 2012, it would seem, is still going strong.

I asked some of the Transform team, where there are more than a few cycling enthusiasts (that’s our chairman in the photo), what it means to have the world’s biggest bike race kick off here.

Joe Tarragano, Director

“I’m excited to see Team Sky on home turf, with or without Wiggins. It’s a strange sport that can ask one of England’s greatest ever riders to be wind-fodder and water bottle fetcher. But the Froome-Wiggins story may perhaps have exposed more people to the sport’s drama. I expect many didn’t appreciate how much of a team event the Tour de France is. And for anyone interested in team dynamics, you can revel in an event that requires people to so consciously agree to NOT winning that they will even give up their bikes to a fallen colleague if it helps that team leader to win.”

Martin Warne, Senior Consultant

“On Monday 7 July the Tour de France will arrive in my home borough, Newham. The route passes through the Olympic Park and on past the school where I am a governor. Our pupils will be lining the route in Plaistow and cheering on the riders. I hope the sight – albeit fleeting, given the speed of the peloton – will excite and inspire them.”

Paul Regan, Transform Associate

“I love what the Tour de France is doing for Yorkshire. The town of Hawes is at the foot of one of the steepest climbs of the Grand Départ route and its streets are strewn with bicycle memorabilia; its buildings splashed with the polkadot colours of team jerseys. By the time the cyclists get down to meet us in London on July 7 I’m hopeful the whole country will have tasted Tour fever – we’ll be out on a small flock of vintage bicycles to watch the race go by, complete with hampers and picnic rugs. Can’t wait.”

Linda Goddard, HR and Operations

“The Tour passes our village on Sunday morning and we’re expecting it to be pretty busy. That’s an understatement. We’ve already been warned that people may arrive in the village on Saturday evening and wait overnight just to get a glimpse as the Tour passes by. Once the main A road into the village is closed we’re stuck for the duration so we’re making the most of it.

I’m busy organising the celebrations – taking over the outside space at our local nursery school in the morning where we’ll be serving bacon sandwiches and then in the afternoon we’ve arranged a barbeque at the village hall.”

Ian Pocock, Associate Director

“The Tour de France is unquestionably the most gruelling event in the elite sporting calendar. It’s one big sporting festival and also an astonishing travelling circus.

My first international experience reporting on sport was covering the Tour de France in the mid-90s and the stages in the heights of the Pyrenees were absolutely stunning.

I was stunned again as I ran to interview Chris Boardman after he crossed the line to win the Prologue time trial in Rouen when I was knocked down by one of the support cars!

For everyone who remembers the magic of the torch relay and how it brought whole towns onto the streets in 2012 – Yorkshire is about to get a repeat Le Tour Style.

Bill James, Chairman

“I grew up in Yorkshire and everyone who knows me knows how proud I am to be a Tyke. But, other than messing about on a bike like any other kid, I didn’t discover a passion for cycling until about 12 years ago. I’ve followed the TdF in its home country and now I can follow two days of the Grand Départ in my home county which I’m sure will be an amazing experience.

I’ll be heading home to Yorkshire to share a house with friends and cycle around the route to the best vantage points we can reach. Probably parking our bikes roadside to watch the tour come through at Otley, Côte de Cray, Blubberhouses and Knaresborough. I’ll be shouting for all the British riders but I’m also keen to see how the continental riders cope with our hills. Yorkshire is turning yellow for the tour, and the tykes will be out in force; if you can’t watch it from the streets tune in on TV – you’ll love it.”

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