Digital Strategy

Summary

Jean Ross, from MIT Sloan's Center for Information Systems Research, discussed the imperative for established companies to develop digital strategies to avoid disruption. She highlighted the convergence of technologies like social, mobile, analytics, and cloud as transformative forces. Ross emphasized the need for businesses to integrate their capabilities to gain competitive advantage and to either excel in customer engagement or provide comprehensive solutions beyond their products. She stressed the importance of execution over strategy and the necessity of balancing operational efficiency with a digital services backbone for agility and innovation.

Takeaways

• 🌐 The digital strategy is a business strategy that leverages technology capabilities.
• 🚀 Technologies like social, mobile, analytics, cloud, and IoT (SMACK) are individually overhyped but transformative when converged.
• 🏢 Large companies must adapt to digital disruption by either creating or responding to it.
• 💡 Digital strategies should aim to eliminate commoditization by focusing on customer engagement or delivering unique solutions.
• 🔄 Startups excel at responsive strategies, which involve constant iteration based on customer feedback.
• 📈 Customer engagement is key for companies like USAA, which boasts high Net Promoter scores and customer loyalty.
• 🛠️ Operational backbone is essential for core capabilities, transactions, and customer data access.
• 🌉 Digital services backbone allows for rapid experimentation and adaptation to internet capabilities.
• 🔑 Competitive advantage lies in the execution of the strategy rather than the strategy itself.
• 🔀 Integration of operational and digital services backbones is crucial for success in the digital economy.
• 🌟 Roles and structures within companies are evolving, with product ownership becoming a pivotal role.

Q & A

Who is Jean Ross and what is her role?

Jean Ross is a research director and the principal research scientist at the MIT Sloan School Center for Information Systems Research, also known as CISR.

What is the title of Jean Ross's talk?

The title of Jean Ross's talk is 'Digital Strategy: Disrupt or be Disrupted'.

What does Jean Ross suggest is the key to avoiding disruption in the digital economy?

Jean Ross suggests that the key to avoiding disruption in the digital economy is to develop a digital strategy that leverages readily accessible technologies and focuses on either customer engagement or delivering solutions that solve customers' problems.

What does Jean Ross mean by 'SMACK' technologies?

Jean Ross refers to 'SMACK' technologies as a collection of new technologies that include Social, Mobile, Analytics, Cloud, and the Internet of Things, which have fundamentally transformed how products and services are delivered to customers.

What is the difference between a digital strategy and a traditional business strategy according to Jean Ross?

A digital strategy, according to Jean Ross, is a business strategy that is inspired by the capabilities of technology, recognizing what's possible with these technologies and leveraging them to deliver products and services differently, rather than just being a traditional business strategy.

Why does Jean Ross emphasize the importance of integrating business capabilities?

Jean Ross emphasizes the importance of integrating business capabilities because it is hard to do and can provide a competitive advantage. It allows companies to deliver products and services in a way that is difficult for others to replicate.

What are the two strategic options Jean Ross discusses for companies to avoid commoditization?

The two strategic options Jean Ross discusses are focusing on customer engagement to create a loyal customer base or delivering solutions that solve customers' problems beyond just providing a product.

Why is execution more important than strategy when it comes to digital transformation?

Execution is more important than strategy in digital transformation because once a strategy is publicized, it can be replicated by competitors. The competitive advantage comes from how well the strategy is executed.

What are the two major backbones that Jean Ross believes are necessary for a company to succeed in the digital economy?

The two major backbones necessary for a company to succeed in the digital economy are the operational backbone, which provides core capabilities and efficiency, and the digital services backbone, which allows for fast experimentation and adaptability.

How does Jean Ross describe the role of startups in the digital economy?

Jean Ross describes startups as being brilliant at having a responsive strategy, constantly adapting to new possibilities, and being inherently internet-capable, which is something larger companies often struggle to replicate.

What does Jean Ross predict will change fundamentally in big companies due to digital strategies?

Jean Ross predicts that digital strategies will fundamentally change big companies by altering roles, structures, and the way products and services are thought of and delivered, with the product owner becoming a key role in this transformation.