The dangers of ‘digitalization’

The Danish Management Society‘s new focus on “Digital Reshaping” – whatever that wording means – made me think;

Whenever somebody talks about the need to ‘digitalize’ products or processes in an old industry company, you as a digital expert should be quite alert. Perhaps even worried.

Because what does the phrase really mean?

I will tell you what it seldom means;

It seldom means that the company in question is looking to question every single process and product it has in order to ask itself questions like “Is this still relevant?”, “Does the product serve a clear need in the market?” and “Have we REALLY understood what it means to make this a success in the current and future market?”. And make the necessary brutal decisions the answers demand.

It seldom means that the company is looking to change it’s entire operating model to embrace the uncertainty of a fast moving market and favor smaller, nimbler experiments as a way of understanding the need in the market before pushing for the big product delivery. And it never means a higher tolerance – embrace even – of risk. Or even a longer time horizon to get things right.

And it seldom means being really ambitious about the people you get on board and – crucially – the mandate you give them to actually make the needed changes happen and – hopefully – put the company on a better trajectory.

All of the above are in my humble opinion key elements for actually making the necessary things happen that will change the trajectory of the company into something better aligned with the needs of the current and future market and customers.

Of course you could be in luck. But alas, you will seldom see these things. What you will see when companies look to ‘digitalize’, though, is;

Doing more of the same but in a slightly different way. Typically by investing in expensive systems from convincing vendors and trying to operate them even though they are often overblown compared to the value they end up delivering to your company.

More of the ‘big bang’ releases that are being touted – using various fancy words – as ‘transformative’ or even downright ‘disruptive’ (which they never are, ed.) that end up failing in spectacular and (sometimes) even depressing ways.

The same old guard of people sitting there making all the decisions lacking the necessary insight into the depths of the matter and what needs to be done while confirming to each other that they have long ago figured this out. And the ruthless of identifying the scapegoat for failure and weeding out of everybody else, who think and try to act in a different way.

The end result?

More blindfolded investment. More wasted investment. More convenient scapegoats when things again don’t go according to the grand ol’ plan.

And very little real change.

So beware. And demand all the right answers to the proper questions, before you get involved.

(Photo: Pixabay.com)

Balance your foresight

When you build new products, you need to be a bit ahead of your time.

You need to be on the lookout for trends that may emerge and have an impact on your product.

What are the signals that suggest opportunities for you, and what are the signals that could put your product in jeopardy if left unchecked?

Both are equally important and needs some serious navigation around.

But there is also a balance to be observed.

Because on the other hand, looking to far ahead and thinking to much about it may emerge you in a fantasy world, where you fail to deliver here and now and – crucially – you get so overwhelmed by what others are doing and could potentially be doing that you just think you don’t stand a chance anyway.

If you get to that point, you’re as good as dead.

So don’t get yourself into that position.

But find the balance so you know what constitutes enough foresight but not too little focus on the present.

(Photo: Pixabay.com)

The negative value proposition

Is creating value as a startup with something new always inherently positive for everybody concerned?

Maybe not.

What if part of the value creation you offer is to help take away the uncomfortable pain of someone having to confront someone else with a problem, the first one really just want to be rid off? Is that a positive for everyone concerned?

Case in point:

If a healthtech startup as part of it’s value proposition offers doctors the ability to spend less time with patients, is that a net positive for all? Why it may help drive down cost for the health sector as such, wouldn’t it be a loss of value instead to a lot of the patients affected by being less able to actually meet an expert?

I am not saying here that it’s wrong, and you shouldn’t try to deliver that kind of value. I am just suggesting that what you may offer as a positive value to one set of stakeholders might be seen as the opposite to another. And you need to be aware of that and own up to the fact that that is what you (also) do.

Especially so if you’re dealing with vulnerable people.

(Photo: Pixabay.com)

5 learnings from HelloFresh

Recently I made a commitment to try different products and services out in order to try and get a better understanding of what it is the best consumer-focused digital companies do that make them so successful.

My starting point was HelloFresh which just recently launched in Denmark.

Monday I got my first shipment from HelloFresh; 3 meals for the week priced at ~130 DKK per meal for 4 people. And these are my first 3 learnings from HelloFresh:

(1) It’s fresh ingredients. I know the point is banal but it needs to be made because it’s important – especially with such a brand name.

(2) HelloFresh operates with a “Zero Waste” promise, and it is easy to see why; everything is sorted for the various means in neat recyclable paper bags, and the measurements of ingredients are exactly what’s needed to cook the meal – no more, no less. When you’re done there’s nothing left – food nor packaging – and thus the promise is kept. Check.

(3) Besides being totally measured most things are clearly branded “HelloFresh” signalling that someone has gone the extra mile in execution of ensuring that things are what they are promised to be and in the quantities needed. It gives a nice touch of care and attention to detail and ensures that both brand and the brand promise is present from start to finish.

(4) With the food NOT being pre-prepped you still get to enjoy the process of cooking even if it’s super easy. It’s quite different from something you just need to heat, and I think being able to add that little extra touch and having some sort of control is super important. Convenience goes a long way but only such a long way. You’re part of the product and process, and in that way it gets under your skin and helps build preference. Pretty clever.

(5) Even though the introduction offer is 30 % of normal price, at 130DKK per meal there is more than enough tangible value in the kit in order to make it attractive. I mean, try to go to the super market and buy groceries for a 4 person meal in Denmark for 130 DKK (or even 170 DKK) with EVERYTHING (except salt, pepper and oil, but you get my point), and you will often come up short. The point: Even if the individual recipe fails or something goes wrong, the value of the offering compared to the alternatives are still there making the offer trending towards a no-brainer to at least try out.

These are just the first few thoughts. I fully realize that it sounds like a glowing endorsement, and maybe it also is. I am just positively surprised by the sheer completeness of the offering in both product, messaging, packaging and everything.

There seems to be no stones left unturned here. Which I guess is the truly inspiring part.

(Photo: Private)

Problems persist

If you are trying to solve a problem that your customers emphatize with but are NOT actively looking to solve right now, does that indicate that maybe the problem is not that big after all?

Conventional wisdom will say that it is definitaly a possibility. But take a step back and consider another thing:

When a user is not actively looking for a solution to a big problem, it is not that the problem isn’t real. It could instead be that the user, in the absence of obvious solutions, have plain and simple given up for now. And that they are just waiting to discover your solution.

Problems tend to persist. Even if we have (momentarily) given up on solving them.

(Photo: Pixabay.com)

Rewind to the pain

The other day I met with a startup in need of some advice. They have been working on their offering for a couple of years, and they felt stuck in terms of getting it to market and choosing the right approach.

They showed me their product, and it prompted a conversation about who they have developed the product for, and what they actually, factually know about the customers, they are trying to get to buy into their offering. It was a classic example of solution looking for a problem.

We took a step back and talked about the value proposition based around the Value Proposition Canvas. And when it came to the problem solving real pains for real customers, it was painfully obvious that the biggest issue for them was that there is a disconnect between the customer pain points and how the product looks and welcomes you.

They left with new insights and ideas into how to progress from here. Sometimes it just pays to rewind the clock and look at whether there is a connection for real between needs, pains and gains and the actual product.

(Photo: Pixabay.com)

Deliver on the dream

I often talk about the need to meet with customers and understand what their needs are. But I also often struggle in getting through with the message of what the real potential of doing so is. So let me try it a slightly different way.

When we sit down with potential customers, or we visit them in their natural environment, we get a chance to ask questions and – most importantly – listen. And when we listen, we get an opportunity to uncover the dreams of our customers.

Dreams are funny. They are for many people characterized by three things: First of all it is something we would really like (to happen), second the acknowledgement that I am not there yet and it is out of reach and third a lingering idea that maybe it will stay a dream forever.

Tuning into the dream will give you the same three things to innovation on: A clear desire, an opportunity to be relevant and – following from that – a chance of creating an epiphany moment for them that they will reward by not only buying, what you have created, but also staying loyal to it. What’s not to like?

(Photo: Pixabay.com)