Why is culture key in digital transformation?
We normally use a pyramid to picture the elements required for digital transformation, and the organisation is the bottom layer of that pyramid for a reason. It represents the solid base required for successful implementation of technology and robust data and analytics, and for delivering targeted content across digital and offline channels. “Organisation”, in this context, means much more than the actual structure of the company, with its hierarchy of responsibilities and departments. Organisation, in a digital transformation world, includes the work culture and the set of practices and attitudes that are key to executing digital transformations.
So why do most marketing organisations struggle to deliver on digital opportunities?
Marketing team setup
The first and most frequent obstacle is siloing of capabilities – not only within marketing teams, but across the organisation. This is what prevents many teams from delivering the 3R– the right message, to the right customer, at the right time. Something as simple as lack of communication between different channel managers might lead to inconsistent messaging across social media, in e-mails or at physical locations.
Managers tend to focus on maximising his/her own KPIs, rather than on thinking holistically about the relationship with the customer. A much more effective setup is the “3H” (or agile team) set-up used often by start up companies, which is organised around “war rooms” that include a hacker (or two…), a hipster (or two…) and a hustler.
Your first hacker is a data scientist (at best) or a strong analyst (at worst) – a person who develops insights from the available data sources with the level of complexity depending on the sophistication required – perhaps going all the way to advanced statistics and machine learning. Once the hacker provides insights, the hustler – a strategist delivering the commercial acumen and providing end-to-end process management – decides on the best strategy to handle the opportunity. Then, the hipster (a designer and/or a copywriter) creates engaging content and passes it back to the hacker – a creative technologist with knowledge of marketing technologies or an ad-ops person, if less coding is required. The hard skills of those 3H functions are complementary.
Additionally, all team members should deploy good communication skills, a can-do attitude, and creativity.
The test-and-learn approach
Another element of the digitally-savvy culture is the test-and-learn approach. A small number of conservative tests is unlikely to produce insights that put your company on the fast track to innovation. But, increasing the number of marketing tests, with an explicit expectation that 70%(!) of them will fail, will reveal those insights. Because risk aversion is so natural to businesses, it is hard to accept failure as something expected or anticipated. No one likes to fail. However, a digital transformation mindset dictates that the result of every unsuccessful experiment is an important piece of data.
To summarise: out of the 30% of tests that succeed, two-thirds will continue getting your standard ROI, but the final third will make you a superhero. Besides, failing in digital is cheap!
The backbone of this fail-fast culture is the heavy use of data and analytics. You simply do not launch any marketing campaigns without having enough data to support them. Data lets you evaluate everything in the plan by ROI and decide on your ROI benchmark – the point up to which you feel comfortable spending money on marketing campaigns.
The power of marginal gains
Embracing digital culture means embracing small changes. Dave Brailsford, the General Manager and Performance Director for Team Sky (Great Britain’s professional cycling team), wonderfully described the power of marginal gains. Brailsford believed in aggregating incremental changes that produce significant improvements for his team over time. He famously said, “The whole principle came from the idea that if you broke down everything you could think of that goes into riding a bike, and then improved it by 1%, you will get a significant increase when you put them all together”.
In other words, you only need 16 separate 1% improvements to improve by the same amount when you are on your 200th improvement, as the amount you improved during the first 69 improvements at the start. The power of incremental changes underlies the Lean Six Sigma methodology that many companies apply to drive high performance. At Toyota, for instance, everyone, from the janitor to the CEO, is in charge of fixing the things that are broken and ensuring they never break again.
Digital transformation is not rocket science, but companies need to “be programmed” to make it happen. After all, what is the purpose of gathering data that no one in the organisation seems to use? Smart prioritisation of initiatives within an organisation should be the starting point of the discussion about omni-channel opportunities.
A Chinese proverb says, “The best time to plant a tree was 20 years ago. The next best time is now.” Following on that, the best time to start the digital transformation of your organisation was a long time ago, so don’t waste any more time and start NOW.
 Read more at: http://jamesclear.com/marginal-gains.