Back in 2013, Bloomberg reported that 8 out of 10 entrepreneurs who start businesses fail within the first 18 months. That’s an 80% failure rate!
A more recent study of the S&P 500 Index, concluded that lifespans of top U.S. companies are shrinking faster than ever before. The report, conducted by Innosight, shows that the pace of change is increasingly threatening some of the most iconic corporations. According to the report, the 61-year tenure for the average firm in 1958 narrowed to 25 years in 1980—to 18 years in 2011 and at this pace of churn, 75% of the S&P 500 will be replaced by 2027.
Many organizations, start-ups through to the big brands, aren’t having much fun right about now.
Now hold that thought for a minute, and let’s fast forward to a session I sat in on yesterday, on the topic of mobility and digital marketing. Mr. Michael J. Becker, a Digital Marketing and Mobility consultant delivered a very compelling, Ted Talks-like session. Michael gave us a birds-eye view of how early stage as well as mature companies are engaging customers through mobile and social platforms, in completely new and exciting ways. I sat there mesmerized and really soaked up all the cool anecdotes!
What struck me, about half way through the talk, is that there are probably an infinite number of creative and innovative combinations and permutations in terms of reaching and engaging customers; from games to contests, to sounds, to smells (yes, smells), to visuals to any number of immersive techniques. He showed us how mobile technologies as well as connectivity technologies, including near field communications, sensors, printed electronics, VR, gesture recognition, embedded cameras and alike can work along or be combined to create lively digital experiences. LOVED IT!
But then, about three quarters of the way through, something else hits me and it hits me like a ton of “ice!” I realized the real moment of truth, the make or break moment of the customer experience, the bond with the brand – doesn’t happen while the customer is engaged during the transaction, the real experience and moment of truth happens well after that SEND button, or ORDER NOW button or whatever “call to action” mechanism is pressed.
The moment of truth is when the entire enterprise, big or small kicks in and delivers on that promise made to that customer during that tantalizing engagement! You know that promise about the fastest delivery, or that “brilliant” piece of jewelry; that perfect fitting pair of shoes, that shiny set of golf clubs, or super easy to use fitness device, or tasty food product; all better get to that customer exactly as advertised and experienced during the initial engagement, or all bets are off.
In fact, if it doesn’t get to the customer in a timely or compelling fashion, the brand promise is broken, sometimes beyond repair. And just like the “right hand” of social and mobile can help you create the perfect experiences and take your business to the moon; likewise the “left hand” of social can clobber your reputation instantly (no offense to the left-handed people in the world). And bad news travels at the speed of the internet these days, especially if the consumer is super disappointed and decides to Instagram, Tweet or Snapchat their unsatisfying experience! Angry mobs form in a heartbeat, as people pile on their bad experiences; and God forbid your situation should start trending or a #tag raised in your (dis)honor. You are a stinky, dead critter like the kind found on the the side of the 101 or Don Valley!
So why is it some companies can rise to this moment of truth and others can’t? It can’t just be the cool, affordable, agile technologies and platforms being employed by start-ups, else 80% of them wouldn’t fail. And it can’t be all the intelligent marketing going on by both types of companies, leveraging analytics and precise targeting tactics; engaging content and ensuring websites are easy to navigate and action oriented? So what is it? Why are so many new companies failing and older companies failing faster than in the past?
Because frankly, they can’t get their act together, is my thesis, after studying the problem during my 30+ years, in start-ups, to mid-size to jumbo sized companies. And when I say “can’t get their act together,” I mean they can’t align their people and processes both strategically and digitally in support of their go to market efforts.
Even with the most extravagant digital marketing campaigns, need the full and complete support of the full and complete enterprise underneath it. What pops up and hits the customer in a creative, social campaign or mobile app, is literally, the tip of the iceberg.
How organizations operate underneath is key and can dramatically affect company valuation. For example, according to studies by Sirius Decisions, companies who are strategically and digitally aligned, top to bottom, are 15% more profitable, at least. That’s huge!
To help your organization enjoy some of that additional profitability, below I’ve summarized some best practices and experiences I’ve learned on my 30 year journey, and in many cases learned the hard way – where the scar tissue runs deep. From me to you, here are my 9 Lessons Learned below… help yourself!
9 Real Lessons Learned to help you digitally and strategically align an organization:
- Executive communication of strategy and goals: Simple and basic right? Well not so much. Communication typically breaks down about half way down the hierarchy, middle managers are the “fizzle out” point as I call it, therefore make sure everyone in a leadership role, understands the strategy and goals, right through the organization and creates an elevator pitch to communicate it to their team.
- Hallucination kills: Ancient Japanese proverb states: strategy without execution is hallucination, so executives, you need to get to ground, and ensure obstacles and non-priority “stuff” is removed. Ensure systems, processes, tools are up for the job from top of iceberg all the way through. Govern and balance investments across the enterprise versus over-indexing on brand new state of the art marketing automation for example, yet leaving the product people with to make due with an outdated PLM system, and outdated development cycles.
- High Velocity/Low Friction Development: Speaking of development cycles, your highly engaged customer, won’t stay engaged for long if you aren’t innovating and delivering new products and new features at lightening speed. Products that had 18 month lifecycles need to be refreshed every 2 months in a “shiny new object” world. Get cracking and give everyone who touches a product, “time to market” improvement KPI’s to shoot for. Crowdsource, set up advisory boards, and look at every agile practice you can get your hands on. A high-velocity front end, e-Commerce site or mobile application, isn’t going to help you if development isn’t “high velocity.”
- Create a Central Nervous System of Connectivity & Data: Get people connected from the inside out – the diagram above shows the elements “under the ice-berg;” make sure people are not only well equipped to do their own jobs in that enterprise, but are well connected and collaborating across the various elements of the enterprise, leading right out into the market(s) you serve and communicating with customers directly where possible. Especially product and marketing people.
- Don’t embarrass the Sales People: Don’t over-index on marketing and sales “feet on the street” if you can’t support it with a set of fresh products or solutions for them to sell. And certainly don’t try to put new products on the street; press release, big launch hype, if your sales guys don’t even know about it or haven’t been trained. If they act surprised when a customer calls and says “hey I read TechCrunch this morning, and heard you guys just launched Product XYZ, can you come over and talk to me about it, I may want to do a refresh.” Yikes… confused sales person… dead air… disengaged customer!
- Speak up: Marketers hold product guys accountable and understand product life cycles and exactly what’s coming, ask for proof points and beta customer testimonials and quote-ables so you have real proof points when something launches. Drive a “check-list” based launch process and hold people’s feet to the fire. And vice versa, product guys hold marketers accountable for what’s being promoted, how, why, to whom and at what price. It’s your P&L, so I strongly suggest you understand what marketing and sales are doing.
- Demand and Supply go on a Honeymoon: Besides sales/marketing talking to product management, make sure your demand and supply worlds connect as well. For example Marketing people you’ve got a “crystal ball” these days; what with social media and sentiment analysis tools all over the place. Share that knowledge with the supply chain guys regularly. Demand visibility in terms of customer sentiment after a new product introduction (bad or good) is like music to a supply chain persons ears, not to mention how happy you might make the finance guy!
- Boomers/Gen’s/Millennials – all talent matters: I can’t say enough about talent… talent spans baby boomers, gen x and millennials these days. Talent management, collaboration tools, staying connected and in sync across these diverse generations and organizations, and understanding preferences and work habits is key to creating alignment. Make sure talent is a critical consideration otherwise, people will get frustrated and leave. And if most generations have their smart phones glued to their hands most of the time, maybe a “mobile first” strategy for new apps is the way to go?!
- The Center of it all – Customers: The whole article was about ensuring an excellent experience with customers, from the inside out, from the first engagement all the way through to loyalty, but just a reminder: keep it real and go less on the gimmicky ads and games and focus on the conversation through Communities, thought leadership, polls, private portals and custom content; these are the real ways to share, innovate and collaborate with customers.
Digital business isn’t just about a funky website or a cool mobile application. Digital can help align from strategy all the way out to go-to-market execution. All the way out to the customer, for that matter. Digital Business is about connecting and aligning people; focus on that and the customer experience and the other stuff will fall into place.
If you would like to learn more about Radius Innovation & Development and how we help customers get ready for the Digital Frontier, please feel free to contact me.