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User-Centered Digital Transformation: Why People Are Key to Success
In the fast-changing world we live in, consumer habits have become increasingly fluid. While businesses recognize the importance of digital transformation (DX) to meet these evolving consumer patterns, many DX programs fail to adapt to the new reality. That’s because DX strategies are too often company-centric, focusing on internal processes and measured by internal key performance indicators (KPIs).
Instead, businesses need to understand how the company is performing for its customers and align their DX accordingly. DX should start with the customer at its core, with a focus on their expectations, preferences and changing purchasing patterns. Without that clarity, DX projects become myopic and narrowly focused, prioritizing internal metric gains instead of what matters most to customers.
To ensure that DX efforts are aligned with user needs, business leaders must evaluate their existing DX strategies from three lenses:
- Has our DX strategy achieved the business advantage we seek?
- Is our digital execution relevant to the end user?
- What new features should we incorporate to meet our goals?
Does it bring the business advantage we seek?
Growth and profitability are essential business drivers for any company, and digitalization has become an indispensable tool to achieve those goals. IDC predicts that by 2023 one in three Asia Pacific (APAC) companies will generate over 30% of their revenue from digital products and services. In APAC, where almost eight in 10 businesses have seen an increase in digital customers in the past 18 months, digitalization has already become an indispensable tool to tap into a new source of growth and revenue.
However, organizations often approach digitalization business-first, rendering customer experience a mere by-product. In APAC, 68% of consumers feel customer service is an afterthought for businesses. This indicates that in chasing growth and profitability, businesses are overlooking the needs of their primary stakeholders — their customers; thus, rendering DX efforts futile and ineffective.
Are our digitalization efforts relevant to the end user?
Organizations like to think they are customer-focused, but most are not. Many established companies often leverage digitalization to enhance their offerings in hopes of market distinction, rather than prioritizing customer needs. However, emerging and innovative companies are challenging the status quo by leveraging digitalization to deliver unique customer experiences, giving industry giants a run for their money.
Today, customer experience (CX) is a key differentiator for customers. About 80% of APAC consumers reported that customer service quality impacts their purchase decisions; 71% would switch to a competitor after one bad experience. That’s why digital players in the health and insurance industries such as One Medical, Oscar and Haven Life are betting big on well-considered, customer-centric digital experiences and strategies to win.
To illustrate, One Medical leveraged digitalization to create a seamless and engaging patient journey. Using a mobile app, patients can book same-day appointments or schedule virtual consultations. The company also automated healthcare providers’ paper-based operations, allowing medical practitioners to focus on providing care and reducing wait times for patients.
Developing such customer-centric products and services requires a thorough understanding of the customer. This is where customer feedback surveys and market insight reports prove essential tools.
Businesses need to carefully evaluate whether they have the right tools to get customer feedback and whether they can measure the efficacy of these tools.
What new features should we incorporate?
The next consideration is what new digital features should businesses incorporate? With most businesses having implemented some form of digitalization, the next big question is almost always about upgrades and how best to enhance DX:
- Which platform should I invest in next?
- Is cloud computing critical for my business?
- How smart should my chatbot be?
While investing in technology like data science and artificial intelligence (AI) might sound like obvious next steps for some organizations, the simplest answer would be: the more you know, the better informed your decisions will be. In other words, rather than chasing advanced technologies, businesses should invest their time and efforts in building strong foundations of customer understanding —and leverage DX to strengthen it further.
Fortunately, many APAC businesses are recognizing the importance of customer-centricity and are set to outstrip other global regions in CX investment. According to Adobe, 59% of businesses in the region are investing in digital CX and 60% are looking to invest in customer data technology.
In many cases, the best investment a company can make is either in robust feedback systems or resources that can help provide intelligence on how new digital systems are working. It can be in the form of smart data, net promoter scores (NPS), surveys or even having the customer insights team pound the pavement. Businesses often make the mistake of selecting options solely based on the cost and ease of implementation, rather than the needs of consumers. Understanding the needs of your end users (internal) or customers (external) is essential before deciding what’s next.
Leading by example in prioritizing a customer-first approach, Memorial Sloan Kettering, a cancer care center, created a virtual community mobile app for patients to safely ask questions, connect with peers and find resources. This significantly improved patient experience and promoted independence and well-being within the community.
User centricity guides digitalization
While most businesses share the same goals of growth and profitability, adopting a customer-centric approach can be a key differentiator for business success. The right digitalization strategy should focus on developing strong foundations of customer understanding rather than solely focusing on internal business metrics.
Instead of repurposing existing digital strategies, businesses should always ensure that their DX initiatives, tools and design approach are uniquely tailored to their customers. We identified four key capabilities —two centered on process and two on employee experience— that are transformative to corporate culture and will help you chart your next chapter of digitalization. Read more in the white paper here.