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I read some interesting articles last week. In particular two have caught my attention: rumour has it that  Apple is talking to McLaren Technology Group as it is interested to enter the automotive industry. Self driven and electric cars are a hot topic. In another article, a UBS analyst was discussing how Tesla Motors (famous for super fast electric cars) is going to face the fierce competition from historical car makers such as Mercedes, Porsche, BMW as they are going to launch their electric car models between 2017 and 2018. You may wonder, and so what?



When I speak to clients there is a myth that mainly start ups are successful when it comes to digital transformation. Start ups are perceived as innovative businesses, with flat structures and wiz “kids” popping up with all sorts of ideas. Actually, I disagree with this view. In fact, also traditional and established businesses can engage successfully in digital transformation. Why?

One of the main mistakes is to think that digital transformation is about technology: actually, it is about strategy and a new way to do business. Technology  is the tool used to reshape the core business. 


Also established businesses (like Apple, BMW or players in other industries) can stay competitive if they embrace digital transformation and a new way of doing business. It goes down to company culture and how things are done in a certain organisation. Resting on their laurels is not an option as the market moves very quickly and what is successful today will be passe’ tomorrow.

In order to engage successfully in digital transformation organisations have to focus on these pillars:

  1. Customers: you do not broadcast to them anymore. As a business you have to engage in a  two way conversation and drive loyalty and advocacy. As a business you don’t talk at them, you talk with them and often develop products and services with their input. Check companies like Dyson: they actively engage their customers and community in suggesting new solutions that can become products.
  2. Data: we are flooded with tons of (irrelevant) data and the challenge is to gather the information that really matters and to use it to make informed business decisions. Amazon is a master at this: let’s take their affiliate programme. They gather useful data on customers buying patterns and they can develop services to cater to their requirements (for example Amazon Basics).
  3. Innovation: cooperation with customers and data elaboration also help driving innovation. Gone are the days of expensive prototypes: A/B testing, agile practices and the possibility to make mistakes from which a company can quickly recover.
  4. Competitors: in the “old days” – actually not more than 10 years ago! –  competition came mainly from the same sector and the competitors were perceived as “enemies”: nowadays competitors can be allies (joint ventures can be very lucrative and successful in order to leverage on each other brands and platforms. Think about an app developed by a technological company and used by the costumers of a sports brand like Adidas or Nike). Competitors are coming from different industries: Google started out a search engine and now it is moving into the automotive sector. Nothing is set in stone anymore.
  5. Value proposition: to be successful in todays’ market the company’s value proposition has to evolve with the market requirements. Let’s have a look at Amazon – it started as an online bookstore and it is now operating in several markets such as like data storage, and movies. It is also opening physical book stores, exactly the opposite direction of its original disruptive aim.

As you can see from the elements above technology is just a tool. In order to get digital transformation right a  business (whether established or new) has to focus on the strategy and on the 5 elements mentioned above. This, more often than not, means changing the company culture: how things are done here.


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