What is Digital Business? + Digital Transformation Case Study

Summary

In this video, Nile McOne explores the key factors that differentiate successful digital innovators from mere digital businesses. He emphasizes the importance of strategic leadership, a culture of innovation, and technology as a facilitator rather than a driver. Using a case study of Erin's business, he illustrates how digital transformation and embracing new technologies can lead to significant competitive advantages and business growth.

Takeaways

• 🌟 Digital businesses must go beyond just using technology; they need a strategic approach and a culture of innovation to gain a competitive advantage.
• 🛠️ Technology alone does not create competitive advantage; it's the delivery agent for the strategies and innovations that do.
• 🚀 Digital innovators view digital transformation as a journey and actively engage in it rather than just adopting the latest tools.
• 🤔 Businesses that are stuck with 'doing digital' often lack leadership in strategic decision-making and fail to foster a culture of innovation.
• 🔄 Successful digital transformation involves changing business processes, using data to identify market opportunities, and innovating continuously.
• 💡 Digital innovators understand the importance of leadership in guiding strategic decisions and encouraging innovation within the organization.
• 🛑 The script highlights a case study of a business that transformed by identifying a market opportunity and changing its business model to offer value differently.
• 💼 The business in the case study leveraged digital tools and data to understand industry changes and pivot its approach to equipment sales and energy efficiency.
• 🌐 Digital transformation enabled the business to offer innovative solutions, such as providing kitchen equipment for free in exchange for managing energy bills.
• 📈 By understanding and leveraging renewable energy and tax credits, the business was able to create a new, highly competitive business model.
• 🏆 The successful digital business in the case study demonstrates the power of leadership, collaboration, and innovation in becoming a true digital innovator.

Q & A

What is the main focus of Nile McOne's discussion in the video?

The main focus is on what makes digital businesses or digital innovators succeed, emphasizing the importance of strategy, culture of innovation, and technology as the delivery agent.

What is the common misconception about digital businesses according to Nile McOne?

The common misconception is that simply using the latest digital tools like blogging, Facebook, or having a CRM system will lead to success, which is not the case.

What role does strategy play in creating competitive advantage for digital businesses?

Strategy is crucial in creating a competitive advantage as it helps businesses stand out and sustain their success in the digital landscape.

Why is technology alone not enough to create a competitive advantage?

Technology alone is not enough because it only serves as a delivery agent. It needs to be combined with strategic decision-making and a culture of innovation to truly create a competitive advantage.

What is the challenge faced by businesses that are stuck in the 'doing digital' phase?

These businesses are stuck because they rely solely on having the best technology and the label 'digital' without understanding the need for strategic leadership and a culture of innovation.

What does Nile McOne suggest as a solution for businesses struggling with competition and technology adoption?

He suggests that businesses need to undergo a process of digital transformation, taking control of strategic decision-making, encouraging innovation, and changing business processes.

What is the case study about in the video?

The case study is about a woman named Erin and her business, Commercial Kitchen Supplies, which went through a digital transformation process to become more successful.

What was the problem Erin faced in her business before the digital transformation?

Erin faced the problem of reduced margins due to customers being able to easily compare prices and find cheaper options online.

How did Erin's business model change after the digital transformation?

Erin's business model changed by offering commercial kitchens for free and charging customers based on their energy bills, taxes, and waste management costs, which she could significantly reduce through innovative solutions.

What role did leadership play in Erin's successful digital transformation?

Leadership played a crucial role by taking control of strategic decision-making, encouraging a culture of innovation, and collaborating with technologists to create a more efficient and competitive business model.

What is the key takeaway from Nile McOne's discussion on digital businesses?

The key takeaway is that a successful digital business is one where leadership, communication, and technology work together to innovate and change the business model, rather than just relying on technology alone.

Outlines

00:00

🌐 Digital Innovation and Competitive Advantage

Nile McOne introduces the concept of digital businesses, emphasizing that merely using digital tools does not guarantee success. He highlights the importance of strategy, innovation culture, and technology as the driving forces behind competitive advantage. Digital innovators are those who have recognized the journey towards digital innovation and are not just stuck with the latest technology. The video will explore a case study of Erin, who transformed her business by adopting a digital transformation framework, focusing on strategic decision-making, encouraging innovation, and using data to identify market opportunities.

05:02

💡 Transforming Business through Digital Innovation

In the second paragraph, Nile McOne delves into Erin's business transformation journey. Erin's business, Commercial Kitchen Supplies, faced challenges due to increased competition and the ability of customers to easily compare prices online. To overcome this, she utilized the seven principles of digital transformation to innovate her business model. Erin discovered opportunities in the energy efficiency of commercial kitchens, leveraging renewable energy and tax credits to offer a new service model. By replacing traditional kitchen equipment with energy-efficient alternatives and offering a cost-saving solution, Erin's business became a digital innovator. The key to her success was the collaboration between leadership, communications, and technology, which allowed her to rapidly grow her business and gain a competitive edge.

Keywords

💡Digital Business

A digital business refers to an organization that operates primarily online, utilizing digital tools and technologies to conduct its operations, market its products, and engage with customers. In the video, this concept is central as it discusses the transformation of traditional businesses into digital innovators, emphasizing the need for strategic leadership and innovative culture to gain a competitive advantage in the digital landscape.

💡Digital Innovators

Digital innovators are businesses that not only adopt digital technologies but also drive innovation in their industry by leveraging these technologies to create new business models, products, or services. The script highlights that these innovators perceive digital transformation as a journey, moving beyond mere technology adoption to fundamentally change how they operate and compete in the market.

💡Competitive Advantage

Competitive advantage is a term used to describe an attribute that enables a business to outperform its competitors. In the context of the video, it is associated with the strategic use of digital tools and a culture of innovation that sustains a business's success in the digital age. The script points out that simply using digital tools does not guarantee success; it is the strategic application of these tools that creates an advantage.

💡Digital Transformation

Digital transformation is the process of integrating digital technology into all areas of a business, fundamentally changing how an organization operates and delivers value to customers. The video script uses the example of Erin's business to illustrate how going through digital transformation allowed her to identify new market opportunities and innovate her business model, leading to significant growth and success.

💡Culture of Innovation

A culture of innovation refers to an organizational environment that encourages creativity, experimentation, and the development of new ideas. The script emphasizes the importance of fostering such a culture within a digital business to sustain competitive advantage. It is the leadership's role to encourage this culture, which is essential for driving innovation and adapting to the ever-changing digital landscape.

💡Strategic Decision-Making

Strategic decision-making involves making choices about the direction and priorities of an organization that shape its long-term success. In the video, it is mentioned that businesses closer to achieving digital innovation have leadership that takes control of strategic decision-making, which is crucial for guiding the organization through digital transformation and towards a competitive advantage.

💡Data-Driven

Being data-driven means making decisions based on the analysis and interpretation of data. The script mentions that successful digital businesses use data to define market opportunities and understand competitors, which is a key aspect of strategic decision-making and innovation in the digital age.

💡Business Model Innovation

Business model innovation involves creating a new way of doing business that adds value to the customer and generates revenue in a different way than traditional models. The video script describes how Erin's business underwent a radical change by innovating its business model to offer commercial kitchen equipment for free, in exchange for managing the client's energy bills, which is a prime example of business model innovation.

💡Renewable Energy

Renewable energy refers to energy generated from natural resources that are replenished over short periods of time, such as sunlight, wind, and rain. In the context of the video, renewable energy is highlighted as a key part of Erin's business model innovation, where she leverages solar panels and other renewable technologies to reduce the energy costs for her clients, contributing to the overall reduction in the cost of kitchen ownership.

💡Technology Adoption

Technology adoption is the process by which individuals or organizations start using a new technology. The script discusses how some businesses are stuck because they have adopted the best technology available but lack the strategic leadership and innovative culture to create a competitive advantage. It contrasts this with digital innovators who not only adopt technology but also use it as a tool for transformation and growth.

💡Market Disruption

Market disruption occurs when a new product or business model creates a new market by displacing an existing market. The video script illustrates this concept through Erin's business, which disrupted the traditional commercial kitchen supply market by offering a new value proposition based on energy cost savings and innovative technology use.

Highlights

Digital businesses need more than just the latest tools to succeed.

Strategy and culture of innovation are crucial for competitive advantage.

Technology is a delivery agent, not the sole factor for success.

Many businesses are stuck due to a lack of leadership in digital strategy.

Competition is forcing businesses to adapt and change.

Businesses need to modernize but also create competitive advantage.

Leadership must take control of strategic decision-making in digital transformation.

Encouraging a culture of innovation is key to digital success.

Business processes and data analysis are essential for identifying market opportunities.

Innovative business models can lead to rapid growth and success.

Case study of Erin's business shows the impact of digital transformation.

Erin's business faced challenges with competition and margins.

Digital transformation framework was used to radically change business operations.

Erin discovered opportunities in energy efficiency and renewable energy.

Offering kitchen equipment for free by reducing energy costs was a game-changer.

Erin's business model innovation created a competitive advantage.

Leadership, communication, and technology collaboration are vital for digital business success.

Erin's business became incredibly successful through strategic use of technology.

Transcripts

[Music]

hello my name is Nile mcone and today

we're going to be taking a look at what

makes a digital business what helps

those digital innovators succeed well

the truth is that many businesses are

simply doing digital we use all the

latest digital tools in the hope and

belief that if we blog enough or

Facebook enough or have the right CRM

system that that leads to success it

doesn't we know that strategy creates

competitive Advantage people in our

culture of innovation is what sustains

it and technology is the delivery agent

and many of those digital businesses

have cottoned on to that fact some

another word for digital businesses is

digital innovators so what is it that

they do that most of us don't do well

they perceive that this new land of

digital Innovation there is a journey

that most organizations can go towards

it those that are doing digital are

stuck because they are have just got the

best technology they happen to have the

word digital and believe that it should

be allocated to either a marketer or a

technologists who then deliver the

websites and the social channels and the

the tools that are needed in order for

the business to operate that does not

create competitive Advantage the

leadership part has been missing others

find that the challenge is a little bit

more daunting they find that competition

is starting to force them to make other

changes they get the latest technology

they follow all the marketing Trends

they Microsoft 365 they've got Oracle

sap whatever it happens to be and

they're pulled by what they're told by

the technologists is going to lead them

to a new

land that creates a little bit of a gap

it modernizes the business but it

doesn't necessarily create competitive

Advantage those businesses that have got

to closer to this new land have become

gone through some sort of process of

digital transformation their leadership

has taken control of the Strategic

decision-making they've tried to

encourage a culture of innovation within

their organization they've changed their

business processes they're using data to

help them to Define if there's Market

opportunity who the competitors are that

must be displaced they're looking for

cycles of innovation they have new

business models that they're taking on

and they tell the technologists what it

is that they want and all of this tends

to lead to create a much more successful

digital business

so now we're going to take a little look

at a kisse study of someone who has gone

through this process in this case study

I'm going to use the lady by the name of

Erin and her business which is not her

actual real name and it's not a real

business name but I can guarantee you

that the story is completely True

commercial kitchen supplies supplies

this kind of stuff here all of the stuff

that you would see in a commercial

kitchen the problem that Aaron is facing

is that it used to be she could create a

relationship with a hotelier or

restaurant send them the quote for the

equipment charge them an installation

fee and then they would buy it now they

can Google it find out the exact cost

from a range of competitors from a range

of countries even the secondhand price

on eBay and make decisions which are

forcing down her margin she then has to

do something about it and is wondering

what it is that will take to make the

change in her business she has been

doing digital to this point she uses the

seven principal's digital transformation

framework and she goes to town trying to

transform her business to make it more

successful so as I said she was doing

digital she happened to have her

e-commerce site going she happened to

have her AdWords running she happened to

have her social channels going but it

really wasn't changing the situation

much she then tried to adopt with new

technology where she had better

Logistics better supply chain better

automated

marketing but again this improved her

business marginally but didn't give her

this massive rapid growth and she was

still finding to be a very competitive

situation when she went through the

digital transformation framework she was

able to radically change how she did

business what happened to eron was that

she discovered that there was a wave of

change coming to the industry hoteliers

and restaurant did not understand what

300 watts versus 160 Watts meant when it

came to energy consumption and the

relationship with money Aaron realized

that with renewable energies carbon tax

credits new me methods for purchasing uh

equipment that was through lease options

the ability to reduce energy costs

through induction rather than gas the

ability to change how we ventilate kit

commercial kitchens using renewable

energies attached to the roof heat

extractors and many other things that

she could massively reduce the cost of

ownership of a kitchen in fact she could

reduce the cost of ownership so much

that she could offer the kitchen for

free all she asked for was let me take a

look at your energy bills right now I

will replace your equipment for you and

you keep paying me what you would have

been paying in those energy bills and

taxes and waste management

costs this changed the game she became a

digital innovator Now where's the

digital in all of this 5 years ago she

would not have been able to get Baseline

energy usage she would not have been

able to get the new technologies to

create Renewables with inside the

organization solar panels on roof wind

turbines to help H ventilate K kitchens

she had to create Partnerships she had

to understand tax credits she had to

create a mechanism that allowed her

Salesforce to be able to go onto the

road to sell this and by the time she

has done this kind of

leadership the competitors aren't even

at the starting git she's created two to

three years of spare space and

opportunity where she practically goes

uncontested she sees rapid growth in her

business and has now become a digital

business because the leadership the

communications people and the

technologists collaborated with the

deliberate effort to innovate and change

the business model to become a digital

business aerin's business is incredibly

successful she uses technology more than

I've ever seen anyone else but she's

been using the technology because she

pushes her business further and the

technologists respond by creating better

efficiencies within the

organization that to me is what makes a

digital

business thanks for

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