Roger Swannell

Tag: digital (page 1 of 6)

Disruption eventually gets disrupted and consumed by the establishment

Uber is held up as an example of of how to disrupt an entire industry, in this case the taxi industry. But sooner or later disruptive ways of doing things butt horns with the establishment. Industries like taxis are regulated by the government, the government makes the laws, and the government doesn’t like it when those laws aren’t adhered to. That’s when companies like Uber find their ‘disruptive’ ways such as not considering their drivers employees challenged and disrupted by the establishment, which decides that those drivers are employees. In this way the establishment takes away any disruptive advantage, and eventually consumes the disrupted into the mainstream of the industry.

The government’s own digital team proved this when they looked at ways to disrupt and digitise the process of buying road tax. They were faced by a law that prevented what they wanted to do. Of course, the solution was to change the law, which they did, but something disruptive companies can’t do.

Crypto-currency, the application of block-chain technology to financial transactions, will go through the same cycle. It’s still too new a technology to have developed a useful application, but it will. And when a disruptive company comes along that can commercialise that application successfully they will be eventually be faced with a government that says ‘play by the rules or don’t play at all’. This is the cycle of innovation in regulated industries. It starts with the birth of the technology, then the application of the tech to disrupt an industry, then the legal challenge by the establishment, and finally the disbandment or consumption of the industry.

Highlights from “A CEO guide for avoiding the ten traps that derail digital transformations” by McKinsey

Highlights from A CEO guide for avoiding the ten traps that derail digital transformations by McKinsey

“… companies need to take more risk, not less. Many senior executives look back on their transformation programs1 and wish they’d been bolder. In today’s environment, making incremental changes is like rearranging the deck chairs on the Titanic.”

“Many companies have adopted a “let a hundred flowers bloom” philosophy that encourages broad experimentation. Such an approach generates excitement and learning, but it can also be self-defeating if not carefully managed. Running too many competing initiatives dissipates management focus and starves promising ideas of the resources they need for a successful scale-up.”

“Focusing on the right kind of initiatives is equally important. Too often, businesses pour resources into programs that yield short-term gains but can’t be scaled, aren’t sustainable, and don’t add value. To avoid this wasted energy, any digital transformation should start with understanding customer needs and build out solutions that not only address them but have the potential to generate the most impact.”

“Evaluating the customer decision journey is a good place to start… the joining and onboarding processes for new customers often offer plenty of opportunities for significant improvement.”

“Agility and speed are second nature to a digital organization, but energy can turn to chaos if it isn’t channeled purposefully. Leaders need to be systematic about identifying and capturing business value, which begins with creating transparency into, and useful metrics to track, the progress of digital initiatives.”

“Organizations that embrace learning typically develop inexpensive prototypes, test them with customers, and repeatedly refine them until they reach a minimum viable product (MVP). They seek feedback on new features from small groups of customers through simple surveys or by gauging their responses to specific elements such as the wording or layout of a web page.”

“However quickly you think you are going, chances are it isn’t fast enough. Speed is of the essence when it comes to reacting to market changes and capturing revenue opportunities before competitors do.”

“The most effective businesses ingrain speed by making agile a way of life. They use short development cycles to address specific needs, try out rough-and-ready fixes repeatedly with customers, and produce “good enough” solutions. In marketing, for example, agile organizations12 can test multiple new ideas and run hundreds of campaigns simultaneously and get ideas into the field in days rather than weeks or months.”

Agile Digital and Ecommerce teams at the BHF

The BHF Digital Teams, like many digital teams, take Agile approaches in their work.

The Digital team uses Scrum with Product Managers writing user stories from other parts of the organisation and taking them to the Development team for prioritisation and planning. The Dev team consists of front end and back end developers, business analysts, and testers. They estimate the size of the tasks and work in two week sprints to complete the tasks. Using Scrum means that once the tasks are prioritised for that sprint they don’t change it. This works well for software development as it’s repeatable work that benefits from a timeboxed approach to deliver value.

The Ecommerce team uses Kanban. We aren’t specialists like the Dev team and our work often involves a broad range of work, including customer service, logistics, developing merchandise, marketing campaigns and products, as well as website development. We accept that with priorities changing rapidly and with what work we can undertake being dependent on others, attempting to plan with any degree of certainty or timebox our work isn’t going to be an effective. We maintain a high-level roadmap that shows what we expect to be working on over the next few months, and we have a very low-level tasks list that we refer to and update daily. This works well for ecommerce projects as the priorities change quickly and often.

Digital Team using Scrum
Ecommerce Team using Kanban
Cross-functional team of specialists, including Product Managers, Developers, Testers, Business Analysts, UX.
Single functional team of generalist who cover Platform Development, Customer Services, Logistics, Marketing.
Daily stand-up meetings to estimate, prioritise and assign work.
Weekly planning meetings to prioritise projects for the next few days.
Works in fortnightly sprints to complete predefined tasks.
Works in continuous flow with priorities changing daily.
Uses a ‘push’ system with work forecasted weeks ahead by the Product Managers and Developers.
Uses a ‘pull’ system with demand from the business and/or customers deciding what work is focused on this week.
Kanban isn’t better than Scrum, or Scrum better than Kanban, each works for the team that applies it in the right way for them.

Turkey Dash – Innovative digital fundraising

The Turkey Dash, by PayPal, is a digital fundraising initiative in support of eight charities.

Turkey Dash

The campaign encourages members of the public to choose a charity to donate to, with the more donations a charity gets the faster their turkey will run in the race.

It’s a really innovative and interesting way to gamify and make fun donating to charity at Christmas time, especially with traditional campaigns relying on messages of suffering to motivate donors. 

The not-so distant future of digital retail innovations

After a few recent discussions around what the future of retail might look like, here’s some future gazing of my own.

Better data sharing leads to greater personalisation

Over the last few years retailers have been working on getting their customer data out of its channel silos to attempt to create a single view of the customer. In the future they will realise that their data is far more valuable if it’s blended with other retailers shopping behaviour data, location tracking data, market research, etc., etc. Big data becomes Huge Data when all of these massive data sets can be joined together and analysed to reach an understanding of an individual to the extent where their needs, motivations and behaviours can be predicted with a practically applicable degree of accuracy.

How might huge data and hyper-personalisation affect the customer?

Personalisation will grow exponentially with every single little detail of every interaction with a business being tailored to each individual customer. The retailers will know what a customer needs, when they need it, and who they are most likely to buy if from before the customer does, and their marketing will lead customers along the happy path to purchase so smoothly they’ll hardly even notice they clicked the buy button. Shopping will become so deeply embedded into life that the idea of ‘going shopping’ will be like going out to the well to get a bucket of water. We don’t do that anymore, we just turn on the tap when we need water and it’s there.

Personalisation won’t just be for the customer, it will be for the business too. It will become a means of connecting with their customers. It won’t be ‘your order is processing’, it will be ‘Alfred is picking your order right now, would you like to watch a live video?’

Artificial intelligence will revolutionise anything that requires thinking

Customer service, merchandising, logistics, finance, in fact every aspect of business can and will be affected by Artificial Intelligence. For a time, AI will be a competitive advantage for those first-mover companies that figure out how to implement it effectively, but the speed of change means that it won’t be long until even the smallest business is powered by AI as much as it’s powered by electricity.

How might AI affect the customer?

The use of AI to take over many of the unpleasant, dangerous, and boring jobs the humans currently do is driving the argument for universal basic income, which would have a massive impact on spending habits in the future.

But even before we get to live in a society where robots do our work for us AI will have a massive, and for the most part, unseen impact on the life of the shopper. Artificial intelligent customer service systems will deal with every customer contact in real time, even being aware of issues before the customer is and only contacting them to tell them that the issue has been resolved. AI customer service will be able to make commercial sound decisions about things like how much discount to offer an individual customer based on their predicted lifetime value and demonstrate with absolute certainty the value to the business of good customer service. AI, and even more so AI utilising huge amounts of data from lots of sources, will make vastly better decisions about all aspects of business because it will understand the far reaching impact a decision will have in a complex system. It will be able to balance the sales that result from stock availability, the costs of distributing the stock, staff availability, customer behaviour patterns, weather, local events that might affect traffic to a shop, etc., etc., to maximize the cost-effectiveness of the business.

Connecting identity to payment will streamline checkout

Traditionally, retail has always regarded ‘who the customer is’ as completely separate from ‘how the customer pays’. This will change as huge data personalisation and AI progresses and customer expectations become more about having a streamlined end-to-end shopping experience that optimises the payment process.

How might streamlining checkout affect the customer?

Clothing shops position their tills to the sides to encourage browsing behaviour, whilst supermarkets line up their tills at the front of the store to make checking out as efficient as possible, and both still struggle to manage queues of people try to give them money. In stores future checkout innovations might be pin entry devices built into baskets that scan items as the customer puts them into the basket, and then the customer simply enters their payment card pin to checkout, or customers having an app on their phone that allows them to walk out the door of the shop with a bag full of items knowing the app will charge their bank account (think the next evolution of Amazon Go).

Online, taking payment could be done using behavioural logic to make educated guesses about whether you are who you say you are. So if you’re making a purchase using a device registered to you, from a location you’ve been to lots of times before, the item is in your size, and it’s being delivered to your work address then the payment system would use statistical modeling to decide if you are who you say you are and then not need you to enter your payment card details in order to complete your purchase.

The decentralization of manufacturing changes economic and distribution models

The use of low cost 3D printing will drive manufacturing into local hubs that can produce products that previously had to be mass produced in the Far East. This will have a massive effect on local economies, the environment, and on the speed at which retailers can launch new products and resupply.

How might 3D printing affect the customer?

Customers will find themselves facing a massive increase in the number of items available and those products will be increasingly made to measure for each individual. Clothing won’t be made in size small, medium and large, it will be made to the measurements the customer specifies. Any and every design of wallpaper, bedding, and wrapping paper will be available. Every possible colour of car, laptop, and inflatable drinks holder will be available. People will purchase products unique to themselves, and retailers will become even more about inspiration and trend-setting to encourage people to purchase with them.

The internet everywhere leads to a mindset of connectivity

Our device-oriented thinking will be replaced with an acceptance that the internet connects all aspects of our lives together. Rather than thinking of our phones as one type of device for doing a certain kind of thing on the internet, IoT devices for a another use, wearables for doing something different, we’ll live in a world where all of these devices will be instantly and always connected and sharing data so that your fridge knows when your going on a holiday that you booked on your phone and adjusts your grocery shopping list accordingly.

How might a mindset of connectivity affect the customer?

This connective mindset will be empowered by the technological changes that in turns drives a behavioural change with people becoming more integrated with the digital systems in their lives, including the heating of their homes responding to the weather, the sat nav in their cars telling them to reduce their speed to allow traffic jams ahead to clear, and retailers having more data about people’s lives to power their AI and personalisation. The internet everywhere will change people’s lives without them really realising it.


Copyright © 2018 Roger Swannell

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