Many of us have become concerned at the general state of digital development across multiple business sectors. For some businesses it’s been a case of do or die – pivoting business models and creating new D2C digital businesses almost overnight. For others, things stopped altogether, as they couldn’t advance their digital offering rapidly enough.
Organisations adaptation into a world where customers’ habits are changing fast, is critical. Within this context, we believe a simple tool that helps establish some core fundamentals will help businesses to survive and thrive.
At Prospero we devised the Digital Maturity Curve as a graphical representation of the differing stages of digital maturity; users can self-identify where they are on the curve and begin to structure plans based on where they want to be in the future. The right-hand side illustrates what full digital maturity means – albeit, as things change, we will update the characteristics demonstrated at all stages of the curve.
At its heart the Prospero Digital Maturity Curve has two key objectives:
Expose the dynamics and characteristics of five different business stages so you can understand your relative maturity
Outline the presence of an inflection point, at which stage the fundamentals must change to make progress towards digital maturity
Assessing where you are on the Digital Maturity scale.
With many fresh challenges facing retailers and brand businesses today, especially during Covid-19, we often find ourselves being asked:
‘How do I know where I am on the digital journey?’
In many senses this comes from a fear that the competitor set is moving forward more quickly than they might be, but it also comes from a lack of understanding of the implications of the different stages for the business. So, we created our Digital Maturity Curve framework to answer this question.
As you probably expect, there is a clear, collaborative process involved in working this out, so that it is agreed across the senior team. Knowing where you are on the curve allows everyone in your organisation to understand where they stand and where they want to be.
Why do you need it now?
We define advanced stages of Digital Maturity as those which indicate being digitally fit for the world today and the next few years – however with the pace of change accelerating it’ll be interesting to see how this holds out.
Often companies have a false sense of where they are compared with others – they may think they are leaders when they are in the mainstream or vice versa. In order to commit to the right level of investment and to initiate the right digital programmes, organisations need to know where they stand. This is best done from an independent standpoint – hence consultancies like us can provide this service.
This will allow your company to realise your full digital potential as you will be shown where your digital opportunities lie. A digitally mature organisation is one that is making the best use of digital technology and its associated culture and networks in everything it does.
What are the elements of the Prospero Digital Maturity Curve?
Our model consists of five stages of maturity which we have defined, based on organisations we have worked with over the last decade. There is then both a straight-line showing the theoretical progression and the inflected curve showing the reality of digital.
The five stages of the model are:
1. Digital Beginners
Are characterised by traditional structures, silos and thinking, that will have adapted only marginally to incorporate an eCommerce operation. eCommerce is likely to have independent KPIs, a separate P+L and little organisational support. There are likely to be with multiple disparate customer data sources appended to largely ad-hoc activity. Examples will be based around more traditional models with legacy technology and original processes predominant.
2. Digital Siloed
Here we begin to see some collaborative working across silos; however, assets are still largely stored locally, and early day view of the customer is very patchy. In this category, appetite is beginning to grow however very little Voice of Customer (VOC) will be used to make decisions. Traditional retailers struggling to pivot away from the high street are very often in this category with independent digital and store teams often creating duplication – focus often remains store based.
3. Digital Aspirations
Enterprise KPIs are frequently in place in this group, decisions are more likely to be based on shared data and collaborative working, attribution models often used and networked assets are common. One of the largest characteristics of this group compared with the last is the desire to change – the widespread acknowledgement that the old ways will no longer always work has firmly set in now.
4. Digital Organisation
Has a reasonable degree of automation and optimisation built-in, VOC is common, data is actively sought and championed, and channels are blurred. Core digital workforce specialist skills are more common and can be deployed flexibly. Channels will be aligned with common KPIs and metrics – so sales per postcode, rather than by channel will focus teams more onto customers. Internal teams are likely to use agile product management ways of working and leadership starts to show itself at all levels of the organisation
5. Digital Leadership (Disruptors)
Brings alignment of customer outcomes with business strategy; the organisation now “thinks digitally” with no separate digital unit or P&L; growth and self-disruption strategies are normal; agility and resilience is achieved through smart teams empowered to make their own decisions within a set framework – management is light touch and technology and flexible processes are lightweight. Dynamic testing has largely replaced strategic decisions. Organisations in this tier are smart and agile, often despite their size. Amazon grew 40% in Q2 2020 despite already being vast – only a digital leader can scale like this. On a smaller scale, start-ups like Arrival in transport or Starling in banking are at this level of digital maturity.
The Inflection Point
As organisations become more digitally mature, they tend to reach a point at which the expected returns from activity dilute below acceptable levels – Prospero regards this as ‘The Inflection Point’.
The Inflection Point is essential in understanding your direction of travel, as it’s the point when a business can no longer continue to think and act in the way it always has, with smaller iterative changes to the way it does business.
Fundamental change is needed to progress. The inflection point shows where this point will be reached. The exact position of the inflection point will differ for each organisation as no two are alike, but they will face common issues that prevent progression.
Being successful beyond this point depends on:
Being prepared to constantly re-invent the business – so for example: setting up challenger businesses inside the organisation, pivoting into a different business model (service v product, D2C v B2B).
Being prepared to fail many times before success arrives, but doing so, quickly – understanding quickly whether targets will be met and learning from the failure, without rancour
Using external voices and experience from outside the business to bolster internal teams and validate decisions and actions – never assume you know everything about your customers – how many retail CEOs have tried shopping in their own outlets? – an external perspective can often be very powerful
Embedding digital resilience and ways of working, and even adopting a new digital philosophy that contradicts the old. Being prepared to upgrade and change things as required. For example: you could adopt a policy to not implement a programme that takes more than 90 days to deliver
How can I use the Prospero Maturity Curve?
As in life more generally our appetite to understand and connect with our health is changing the landscape. Becoming digitally fit in many ways no different, at its centre is an understanding of the ‘now’ position followed by the defining of your aspirations and philosophical goals. Once that’s achieved define the core steps for achieving these goals with current/future resources provides an initial road map for you to follow
Use the maturity curve to determine progress or/and to set aspirations for the next 24 months.
It’s what we do
We offer a digital maturity assessment as an addition to our digital diagnostics framework (PDF) assessment or as a separate audit. We do this as we understand and appreciate that the organisation’s digital maturity is a by-product of our diagnostic work. We are often reminded that the independent/ agnostic view is very valuable to those working in their company’s bubble and would have been almost impossible (valueless) had we done it ourselves!
As part of identifying where you are on the maturity curve, defining your aspirations as a business is important as there are many shades of grey in any organisation and we can help clarify them and work through potential issues.
In 2020 it’s become very clear that existential threats to retailers and brands are very real, and when they hit, can tear up the old playbooks overnight. Such challenging times require business leaders to adopt a high level of curiosity that can be applied across their wider business, including the health of their digital delivery. Retailers and brands must be fully aligned with customers and deliver in agile, digital, ways so “Black Swan” events can be accommodated with least damage.
Prospero’s Digital Maturity curve is a way of ensuring you are in the right place and on the correct path. If you have the right skills in-house you can even work out where you are on the curve yourself. However, if you are more curious and value an external perspective, it might be time to drop us an email and see how we might be able to help you.
Talk to Prospero