Changing the business while running the operation

In our Digital Business (DB) series journey so far, we

• Examined what it takes to be a digital business.
• Clarified whether being a Digital Business is for you.
• Put digital landscapes into perspective by looking at how businesses use applications to create advantage.
• Mapped out the journey you need to navigate to become a Digital Business.

In this post, we approach what being or becoming a Digital Business means for a start-up or an incumbent established business whose operation is already in-flight, servicing customers and with ongoing partnerships.

Start-Up mode

Starting a digital-native business or business unit from scratch has its advantages. In start-ups, there are no legacy processes, mindsets or technical debt to handle. Challenges are deeply rooted around starting everything from the ground floor, spreading your time across:

• Creating and shipping your digital solution in line with your business purpose
• Establishing key standard operating procedures (SOPs)
• Meeting regulatory requirements in terms of documentation and their impact on processes
• Engaging and training your talent pools
• Developing new partnerships and go-to-market routes
• Etc

Established businesses have a completely different set of complex and delicate challenges.

Incumbent mode

As an incumbent, you are already dealing with an existing set of clients using specific product capabilities, existing ways and engagement rules. You have ongoing customer relationships to maintain and most likely have a ton of technical debt to deal with that went unmanaged for far too long.

This means that, unlike digitally-born start-ups, you need to drive two types of change while balancing the current value of business assets and re-structure to enabling digital scale and growth:

• Internal change
• External change

What this means for you

Whether you are operating in an Incumbent or start-up mode, the baseline rules are the same:

• Understand the nature of your abilities and challenges
• Have a crisp definition of the value you and your business provides and to which stakeholders
• Define measures of success of stakeholders using your product/services, and map out the systems of work needed to fulfil
• Identify any supportive environments required to survive and focus (platforms, work management, support, finance/treasury, HR, leave management etc.)
• Manage regulatory expectations
• Invest with purpose. Ensure board and leadership mandates are aligned and backing you both in principle and investment priorities.
• Ensure leadership adequacy, time availability, and the focus needed to build an environment that can launch, operate, promote, and transact value 24/7/365
• Determine what it takes to keep your customers engaged for as long as possible globally

Advancing Digital Business Assets

Organisations typically either try to pivot into starting a software company or becoming a digital-first provider, without necessarily understanding the key capabilities, supporting environment, regulatory, investment, leadership, time and focus needed to launch, operate and maintain their ability to promote, trial value, transact and keep customers.

You may also not fully appreciate the multi-pronged effort needed to advance the value across your business assets. Not all assets need to grow together; however, they need to advance in harmony and mutual awareness.

Software business and digital transformation investments are more successful when backed by a scope of intent and clarity on which business asset value they will advance.

We suggest reviewing your plan with your leadership using a Business Model Canvas technique. Use its outcomes to get a common understanding of how your approach will impact the following areas of or your organisation:

• Core Products
• Value Chain
• Organisation

If you notice that you are investing 80%+ of your energy in figuring out only one aspect of the above three, you can safely bet you are setting yourself up for failure.

You may be better off taking a step back and having deeper conversations with your team or people experienced in digital leadership to understand whether:

• You can deliver the required value to your target audience
• You are clear around the different ways you will promote and sell (direct/channel)
• You are advantaged to use outsourcing/near-sourcing services for focus
• You need to understand better the legal considerations (EULA, Privacy agreements, GDPR etc.)
• You are approaching this work in a way that enables prototyping, and swift experimentation to achieve business, partner and customer frequent feedback and continued buy-in

Congratulations, with this approach, you have just established your baseline mindset to driving a Digital Business!

Go go go!

Wrapping Up

Summarising our progress, in our Digital Business (DB) series journey so far, we

• Examined what it takes to be a digital business.
• Clarified whether being a Digital Business is for you.
• Put digital landscapes into perspective by looking at how businesses use applications to create advantage.
• Mapped out the journey you need to navigate to become a Digital Business.
• Discussed the implications of changing the business while running the business.

Explore the rest of the "Digital Business" series:

Remember:

• There is no one-size-fits-all solution for companies to become Digital Businesses.
• It is only in uniting people, products & processes through a common vision, a deeply felt purpose, and a broadly shared dream that will continue to motivate stakeholders to push on and persevere.
• Many paths can lead to your desired destination. Each route while equally viable have varying degrees of complexity, sophistication and completeness.

My purpose in the series is to share lessons learned in building global software businesses to help you achieve a Digital Business with assets people want to buy.

Let me know what you think about this series and whether you feel something important was left out. Reach out on andre@andremuscat.com.