Since the dawn of the Internet, companies have been leveraging new technology to improve efficiency and deepen client engagement. We’ve seen many large and small companies succeed with this strategy, but a third of European companies are yet to make the move. In this session, we explore a range of digital transformation strategies, why you might embrace them, and how to kick off an initiative within your organisation.
When a mid-market business runs efficiently, it’s more profitable. Customers are happier and employees enjoy their jobs more as well. So how does IT help? We spoke to our experts about using IT to increase business efficiency—to add value, lower costs, improve service, and ultimately grow a mid-market business without growing the headcount. The sectors we discuss include professional services, manufacturing, wholesale, and more.
Part 1: Efficiency In Challenging Times
Part 2: How do you Grow a Mid-Market Business without Constantly Growing the Headcount?
Part 3: Why are RPA Tools so Powerful?
Part 4: How does IT reduce Error Rates in Manufacturing?
In challenging times, how can mid-market businesses save money while improving service to customers? Our experts discuss manufacturing in this clip, but the lessons apply to all sectors.
[Watch the full Leveraging IT for Business video here]
How do you grow a mid-market business without constantly growing the headcount? Our experts explain.
[Watch the full Leveraging IT for Business video here]
Software robots can have a transformative effect on a mid-market business. Find out how.
[Watch the full Leveraging IT for Business video here]
Our experts explain how new IT tools can help mid-market manufacturers.
[Watch the full Leveraging IT for Business video here]
FACT: The CIO/CTO position is the only Board position where the necessary knowledge and skills need constant updating. Just like Moore’s Law has seen the exponential increase in computing power, so has the IT expert’s need to stay abreast of technology. It can be a nightmare. CEOs want their teams to be on their ‘A’ Game, and for us that means constantly updating our knowledge and our ability to handle new tech.
And the stakes are high. IT increasingly underpins all strategic business objectives—no department can deliver them without IT. It’s our team that increasingly underwrites the strategic objectives and enables the CEO to deliver them and to provide shareholder value. So we absolutely must understand the latest technology and being able to discuss options, ideas, and principles with department heads.
We don’t have to know everything. I’m not talking about in-depth ‘build-a-layered-network’ type of knowledge. I mean having enough technical knowledge to be able to innovate, to make informed strategic decisions, to keep the business ahead of the competition, and to know what the technicians are talking about.
This means that a fundamental part of knowledge acquisition is deciding what to learn, how to learn and when to learn. So, how do you choose?
The idea then is to figure out where each bit of technology falls on the continuum. Here is what I suggest:
· What do you need?
· What does the company need?
· What does your team need?
Where is the most urgent need for knowledge? Concentrate on that area, but don’t ignore the others—make sure they have an appropriate place in the order.
· The traditional route. Websites, books, magazine articles, etc. Many CIOs we know set up Google Alerts on topics they want to stay on top of. This method is useful for finding new knowledge or innovative ideas.
· The on-the-go route. Podcasts, TED sessions, audiobooks and the like—sources that you can learn from when you’re driving or exercising. This method works well for topic assessment or getting under the skin of a specific technology.
· The planned attendance route. These are occasions when you’ve signed up to a training session, a conference, or a webinar, because the topic is interesting and useful, but it’s not an immediate priority. It’s also useful for ‘large topic’ learning.
· Just-in-time. This is when you’re just a few pages ahead of those you’re working with. This sort of knowledge can be gained from peers, colleagues, or even the technical teams. You just need to know how to ask the right questions. This is not a substitute for the other routes; it has to be ‘as-well-as,’ not ‘instead-of.’
· ‘Find an expert who knows.’ Look within your network for someone with an in-depth knowledge of the subject. Buy them a coffee or lunch and find out the salient points. Also: ask the expert how he or she acquires their knowledge; they may know a website or seminar you haven’t heard of.
Remember that for the most part this is not about monolithic knowledge. It’s about distinguishing which pieces of knowledge will be useful to you and the business. Prince2, for example, is all very well. But if you try and implement the whole thing you lose credibility. Instead, implement a few useful parts as the basis of sensible project management. The key to knowledge acquisition is knowing which bits to leave on the cutting room floor.
CIOs and CTOs have a complex job, and their knowledge base reflects that. It’s not just the functional IT knowledge they need to keep improving, there’s all the IT leadership knowledge as well. Not to mention the business and commercial skills, like forecasting and budgets. Whilst these other areas of knowledge don’t change at half the speed functional IT does, they do move on. So you need to constantly review the diagram above, adjusting your learning objectives accordingly.
A successful CIO or CTO will be the one who invests time and energy in judiciously updating their knowledge and skills. If it’s not yet a priority for you, it damn well should be! The fundamental point is don’t let it become something that you look back on and realise you should have done more of. Regret can be a painful thing to have in a career.
We’ve seen so many changes in online service delivery. What does it all mean to a mid-market business? Our IT and technology experts discuss the pressing topics in online service delivery, such as the big shift to ecommerce, adding value post-purchase, better integration with vendors to save time and money, and meeting the needs of demanding corporate clients.
Also, visit our Technology Roadmap for Growth Knowledge Centre, which includes more on this topic.
Freeman Clarke is the UK’s largest and most experienced team of fractional IT leaders. We work exclusively with ambitious organisations, helping our clients use IT to beat the competition. Contact us and we’ll be in touch for an informal conversation.
Let’s start with a definition. For us, digital transformation means using IT and technology to dramatically change your business for the better.
That may mean a custom or bespoke software product. Or it may mean integrating your systems on the back end, or a complete overhaul of your IT systems and suppliers. Whatever the tech issues, it means focusing on your customers, your market, and your risks. Every choice is to ensure that the internal operation of your company is not limiting its growth.
Another important point is that the transformation is individual to your company. There is no one-size-fits-all solution, and anyone telling you so is after your wallet.
That doesn’t mean we won’t see big changes in the next few years. Again and again we’ve watched as what used to seem like extraordinary technologies—such as voice recognition, complex mapping and routing, and software robots—quietly become a part of the everyday life of a mid-market company.
Similarly, though the excitement about drone deliveries and artificial intelligence seems to have faded, we still think they’re coming. Whenever I see such innovations being tested, I think they’re important guides to what will gradually come to our sector, the mid-market.
How the Pandemic Transformed Digital Transformation
Before we get into what’s coming, it’s useful to look back. The pandemic changed digital transformation in two fundamental ways.
First, everything went online, and faster than we had thought possible. Everyone now expects online sales, service, and support. Business and domestic consumers rapidly adopted online channels for finding and buying a wide range of products and services. This also extended to after-sales and re-ordering, which are online now in a way that seemed unlikely in 2019.
Similarly, paper is on its way out. Cash has been side-lined by electronic payment. Printed brochures and catalogues have disappeared from many sectors. (In fact, if your business is still reliant on paper, that would be the place to start a digital transformation of your company. More ideas here.).
Second, we saw a rapid shift to remote work. Not that it was a simple process: we saw business struggle when their systems and processes were badly integrated and ill-defined. But everyone, whether they liked it or not, quickly got used to collaborating online.
In every situation above, old-fashioned managers were saying, “It will never work.” Which leads me to conclude that often digital transformation is driven by attitude rather than what is technically possible. And attitudes have changed irreversibly.
What’s Coming to the Mid-Market
In the near future, for many mid-market businesses the next phase of digital transformation will focus on the following:
What Hasn’t Changed—and Likely Never Will?
Most mid-market businesses are deeply concerned about supply chain issues, recruitment, and energy costs. New technologies—and the judicious application of existing solutions—can ease all these issues, but only if you successfully meet human needs at the same time.
Zoom and shared docs are no substitute for real face-to-face collaboration. You cannot have a real creative discussion, shift entrenched opinions, or lift someone’s spirits online. Digital transformation can drive everyday productivity. But for most people, an enjoyable job also means human contact.
Most people also want their company to have a vision beyond profit. They want to draw more from their work than just their salary. Digital transformation can absolutely make a difference in a mid-market business—but only when you include the human factor.
No matter what your sector or the size of your business, a digital transformation won’t take unless your staff feel included and valued.
With all that in mind, now it’s time to think about your company. If you redo your IT and technology with a magic wand, how would you do things differently? What barriers to growth would you remove?
Here are 10 ideas to start your Digital Transformation Journey.
For more guidance on digital transformation, see our free, plain-English guides here. And for a no-strings, no-pressure conversation about the digital transformation opportunities within your own business, get in touch.
Private Equity (PE) ownership of mid-market companies is increasing. Of course, PE investors are driven by valuations, and these days IT and technology are at the heart of business value.
In the PE space, there are four areas where IT strategy and execution drive value:
PE houses building an integrated group of companies will often aim for one of the companies to be the “platform” onto which they can add other companies.
The platform company will have well-implemented processes and technology. It will provide good service at low cost, and provide clear, flexible and timely management information. It will have the capability to grow and deliver high margins.
Most importantly the platform company may be valued at twice the multiple of the others due to its ability to assimilate and support acquisitions.
IT and technology due diligence in mid-market deals is often overlooked. Or it’s a box-checking exercise, because traditional DD providers use lengthy old-fashioned checklists. These provide limited real value and lack commercial insight (and are often hugely over-priced!).
More thorough DD providers carefully check the basics: security, compliance, risks, legal exposures, contracts, people, suppliers and costs. But in the mid-market, DD expectations need to be realistic. Most importantly, value-focused buyers use DD to gain insight into future opportunities in addition to the risks.
These days almost every marketing innovation has its roots in technology — businesses and consumers are increasingly finding, choosing, and buying products and services online.
Brands that want to engage with consumers will tend to do so by establishing a 1-to-1 relationship. They offer immersive digital experiences that provide value to the consumer and insight and lock-in for themselves.
For B2B suppliers, the ability to integrate your systems with your clients is critical, and areas like security and reliability can enable you to acquire and retain high-value corporate clients.
These marketing innovations make mid-market businesses more attractive to PE.
These days, a company’s size is no indication of its ability to transform the entire market. Even a smaller company can radically improve its internal operations and valuation using digital technology.
For PE-owned businesses, or businesses looking to maximise their value to PE houses, digital transformation can be invaluable. Read our article on the four types of digital transformation and how to get started on using technology to make fundamental improvements to your mid-market business.
To find out more, watch the video Focus on Private Equity, where we explain four areas where well planned and executed technology strategy really drive business value.
Ambitious business owners strive to improve the way their organization functions. Digital transformation is just one way. It enables a business to function more efficiently in the long-term with greater cost savings. But to see any of these transformations occur, you need a solid IT strategy that supports the overall business strategy—and an experienced technical leader to help you get there.
Don't get left behind! Use these 10 ideas to get you started on your own Digital Transformation journey
Download now for FREE!So what exactly is Digital Transformation?
For our clients, Digital Transformation simply means using IT to deliver dramatic improvement. That’s different to just an upgrade or fixing some niggling problems. It means: using IT to make a significant change for the better.
That may just mean simple IT done well – that’s surprisingly rare! Or it may mean genuine technology innovation, something that is breaking new (or new’ish) ground.
We simplify this issue by defining 4 different kinds of transformation:
1. Market breakthrough
2. Wow customers
3. Internal redesign
4. Tame the risks
For an explanation about the 4 types, read our original post.
Visit our Business Growth Knowledge Center
This is the final post in our four-part series on Digital Transformation. For a more in-depth definition of Digital Transformation and its four types, read the first post.
For many companies, the technology strategy begins and ends with technical details in which the Board has little interest. The absence of experienced IT leaders with vision means that the IT slot on the agenda is a wearisome discussion of details, issues and gripes.
But IT genuinely has the ability to transform a business. There are radical new ways to grow the business, to serve customers better, and to make more profit. Businesses that can connect with these benefits are, understandably, valued far higher than their low-technology competitors.
For our clients, Digital Transformation simply means using IT to deliver dramatic improvement. It’s more than just an upgrade or fixing niggling problems. It means using IT to make a significant change for the better.
It doesn’t have to be complicated. It may just mean simple IT done well—which is surprisingly rare! Or it may mean genuine technology innovation, something breaking new ground.
For one of our clients (discussed below) Digital Transformation not only radically improved how the business worked, it reduced IT spending by 75%! Other clients halved delivery times or became vastly more competitive with more accurate risk calculations and pricing.
We break down Digital Transformation into four categories:
In this post, we’ll discuss internal redesigns and risk reduction.
Growing Pains—When Problems Often Start
Entrepreneurs naturally focus on seizing opportunities. They tend not to worry too much about the details.
But when company revenue turns from millions to tens of millions, organizational issues build up. Typically, people’s jobs become progressively less productive. There is increasing reliance on individuals, and often there is friction between people because the processes have been designed ad hoc.
Most importantly, many employees begin to see these issues as normal, and they see handling these problems as the purpose of their job.
People stop complaining about how much time they spend in Excel processing an order; instead they ask for more Excel training. Meanwhile everyone seems to have forgotten that order processing should be entirely automated.
Three Main Opportunities
A useful way to navigate Digital Transformation is to consider three specific opportunities:
In some cases, it’s possible to bring about genuine transformation via a well-engineered top-to-bottom system replacement program.
British Retail Consortium (BRC) is the go-to trade association for all UK retailers. Their membership encompasses over 70% of the UK retail industry (by turnover). With its twenty-five years history, BRC had a number of inefficient systems. Over the last two years, they have been through a complete systems transformation project with impressive results.
BRC’s CEO Helen Dickinson summarizes their objectives: “We had systems and ways of working that were deeply embedded but not always efficient. Several areas of our business were caught up in this problem, and it impacted people’s attitude to their work. Many aspects of our business are about publishing, and our website was completely out of date. Not only did it fail to project our brand, but publishing content was difficult and time-consuming. Our working practices were looking old-fashioned—lots of expensive office space and everyone chained to their desks. It was time for a major overhaul.”
A Freeman Clarke’s Principal became BRC’s CIO. Over a two-year period he shaped, planned and delivered a program of changes. He explains:
“Real change is about systems and how people work, so a large part of this project was ensuring effective communication and that people were on board. For example, once we had created a more effective website and publishing system, we had to work out how to take BRC’s brilliant content and turn it into things people want to read, watch or listen to. This meant new ways of working as well as new roles and new attitudes.”
With his guidance, BRC replaced every system in the business. BRC also moved to modern offices and reduced office space by 30% with flex-time. To ease staff through the transition, they invested in workshops and discussions.
“The results speak for themselves,” He says. “The old systems were not fit. Overall IT costs were 10% of revenue. Now it’s 2.5%!”
Chillisauce is an example of how a Freeman Clarke Principal removed swivel-chair problems and improved integration with suppliers—and radically improved their customer experience at the same time.
Chillisauce is an events agency that specializes in bachelor and bachelorette parties. It offers a choice from over 5,000 different activities in seventy cities worldwide. Customers use their website to select all the components of their own event including activities, locations, hotels and transport.
James Baddiley, CEO of Chillisauce, explains their challenge: “Our website was just an online brochure. If a customer wanted to actually book an event they had to call us. We would craft the event with them over the phone, and we would liaise with the suppliers manually. We’d communicate with the customer through emails, and at the end, hopefully they would book!”
Another problem was their inflexible website. It was a major undertaking to add or change a product.
“A bachelor or bachelorette party is a major event for people,” Baddiley says. “We want to make it fun and offer the best experience and the best options on the market.”
Freeman Clarke Principal Tony Tinnirello advised Chillisauce to transform the entire fulfilment activity. Tinnirello explains:
“We implemented a suite of new cloud-based systems. And we used sophisticated technology to link them all together. So the entire process is far less manual, far faster and less error-prone. Customers can create their event online, book, and then check the status of each element as it takes shape. Critically, we generate prices dynamically so customers can see the price right in front of them—that’s very rare in this market.”
The system now also provides Chillisauce with a wealth of data. They can check revenue and margins on every product, ensure they are meeting service targets, and deal with any issues rapidly.
“In particular,” says Tinnirello, “this has been a huge time saver for the accounts department.”
Digital Transformation can transform a business by addressing risk management. By understanding risk in specific contracts, products or customers, you can price more accurately and competitively. Provision for risk can be applied more specifically, perhaps by more sophisticated analysis of a company’s own existing data, or by combining data from multiple systems, and potentially third-party data as well.
In some cases, the transformation may be achieved via a more timely application of existing risk processes. For example, real-time calculation may allow more accurate pricing for sales people on the phone or for online customers. Prices can be adjusted dynamically to reflect customer credit risk.
Accurate risk reporting also frees up time at the executive level. If simple risk data is available in real-time, then the Board can take measures to adjust as a routine activity. Automated rules engines or AI can pick out patterns or raise alerts when thresholds are near or are breached. Simply having hard facts readily available reduces the level of anxiety!
For companies heavily reliant on IT, well-structured systems ensure resiliency when disaster strikes.
Employees of the British Retail Consortium were once locked out of the offices for three weeks after a fire. Thus, with good reason, their transformation project included business continuity plans. The tragic London Bridge terror attack in June 2017 put this to the test, as their office was again unavailable for several days. But this time they were able to continue working without interruption.
How to Start Your Digital Transformation
In our experience mid-sized businesses often have a huge advantage over their larger competitors in this kind of transformation. Larger businesses have layers of managers who are deeply entrenched in existing ways of working, and the changing their ways of working can be a huge task.
For ambitious mid-market businesses, the Board can personally see and hear what is happening with customers, and the company is small enough to make rapid decisions and changes. Of course, a major change is never simple, but the scale of effort increases greatly for larger companies.
The best way for ambitious mid-market businesses is to start with a blank sheet of paper and design the framework you really want. The following questions are a great way to kick start a Board workshop:
Ambitious business owners will always look for ways to improve the way their organisation functions. Digital transformation is just one way. It enables a business to function more efficiently and in the long term with greater cost savings. But to see any of these transformations occur there is a requirement for a solid IT strategy that fits in with the overall business strategy and an experienced technical leader to help you get there.
This is our final piece in the DT series and is the Board action plan that will help you get started on your own journey. It covers ideas around automation and artificial intelligence, risk analysis, data visualisation and much more which are all achievable if you’ve got a vision and the right people to get you there.
Don't get left behind! Use these 10 ideas to get you started on your own Digital Transformation journey.
Download now for FREE!So what exactly is Digital Transformation?
For our clients, Digital Transformation simply means using IT to deliver dramatic improvement. That’s different to just an upgrade or fixing some niggling problems. It means: using IT to make a significant change for the better.
That may just mean simple IT done well – that’s surprisingly rare! Or it may mean genuine technology innovation, something that is breaking new (or new’ish) ground.
We simplify this issue by defining 4 different kinds of transformation:
1. Market break-through
2. Wow customers
3. Internal redesign
4. Tame the risks
For an explanation about the 4 types, read our original post.
Plain English board-level briefings focused on technology strategies to deliver competitive advantage and business success.
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Call us on 0203 020 1864 with any questions.
Graeme Freeman
Co-Founder and Director
Plain English board-level briefings focused on technology strategies to deliver competitive advantage and business success.
You can unsubscribe at any time.
Call us on 0203 020 1864 with any questions.