Perficient Digital Transformation Blog

Archives

The Importance of Context in the Change Management Decision

shutterstock_233016961_350Context is critical for any big decision, and Change Management is no different. In fact, context is more important for Change Management decisions than many others in business today. One of the biggest struggles that Change Management practitioners face is getting the buy-in from senior leadership that Change Management efforts are worth the investment.

Let’s face it – Change Management isn’t always cheap. It’s not necessarily going to be a $20,000 bolt-on to a $1,000,000 project. To compound this challenge, there’s not a Change Management “product” at the end of the day that can be sold to generate revenue. It can be a hard sell in today’s climate where companies are fighting for every decimal point in the margin calculation. If I told you that the Change aspects of an initiative were going to cost $250,000 on top of the technical and project management aspects, would you do it? Out of context, probably not!

So why should we then invest in Change Management? Ultimately, if we have a competent IT staff or partner, I’m pretty sure they’ll deliver solid, if not outstanding, technical components. Where most projects fail (and more than two-thirds of projects do fail, per a commonly cited IBM Global Services study), is with user adoption, or lack thereof. The investment you make in Change Management may actually be the most important money spent!

In the $1,000,000 project example I mentioned above, let’s say the organization’s leadership is expecting a 3x return on that investment (ROI), or $3,000,000 year-over-year (YOY). The question becomes, “How much of that $3MM is dependent on users actually engaging with and using the new tools effectively?” Typically, the answer to this question is 75-80% (there are ways to calculate this). There may be some value in having the new system in and of itself (e.g., lower maintenance costs, regulation/penalty avoidance costs, etc.), but the real value in the system will be the result of people interacting with the system well.

OK, so if we say 75% of the ROI is achieved with appropriate user engagement, then we’re looking at about $2,250,000 ROI YOY that is dependent on people being ready, willing, and able to engage with the new tools. Said another way, our operational risk is $2.25M! That’s a huge number, and I don’t know too many senior executives who will sleep well at night knowing that this kind of risk is looming on a project they are responsible for. Is there an answer?

Of course there is. Oversimplified, many look at Change Management as an insurance policy to protect their investment. Change Management programs focus on the users, getting their buy-in early, communicating the right messages at the right times to the right audiences, and providing training in the new tools, ultimately ensuring readiness at go-live. Projects with effective Change programs are 95%(!) more likely to be successful than those that don’t (Prosci 2013 Best Practices in Change Management). Without this focused effort, projects are at a severe risk of not generating the required returns because the people will fail to be productive at the desired levels when the switch to the new system occurs, and there are all sorts of side effects to this (low morale, poor customer service, etc.).

Spending a large amount on Change Management out of context is a hard decision to make. However, when looking at the same spend in context, especially financial context, where a solid Change effort will allow you to reap the benefits of the project where you are making a significant investment, it makes all the sense in the world.

Digital Strategy in a Competitive World

Daniel Rabbitt blogged on Competitive Strategy in A Digital Age over on our Oracle Blog.  He makes a lot of great points so it’s worth a read and that’s not just because he mentions my much more famous namesake, Harvard Professor Michael Porter.  Here’s a couple thought provoking quotes

Can leading players (in this case, market-leading companies) expect customer loyalty based on past results?

…..

When a major shift occurred in an industry, such as the decline of a former market leader, often the pundits looked to the five forces for perspective. But in an age when digital transformation impacts every aspect of our economy,

My first thought is that Daniel has it right.  You cannot rely on past results for customer loyalty.  You also will find it difficult to react at the speed of digital without putting in place your own plans to be agile and customer focused in todays marketplace.

Case in point, one client of ours is going through some significant disruption.  When analyzing that disruption and what they should be doing, one quote came to fore, “But our customers love us.  I speak on the phone to them all the time.”  What that misses is the fact that while many existing customers may love them, those that do not are already exiting without leaving a postcard.  New customers may not even find them because they do their research digitally before picking up the phone…… an area where this company has room for improvement.  My point is that without a digital baseline and a go to strategy, major shifts will impact you and they will impact you faster than you expect.

 

Don’t Underestimate The Power of Disruption

Today I received an email from Uber asking me to take an active part in Ubers now public fight with Mayor De Blasio of New York City.

uber

Anyone who knows Uber won’t be surprised at this and at the changes to the app they made for all NYC users.  There’s another trend you can see from a Bloomberg article, How Uber Took Over a City about Portland’s challenges with Uber.

Yet Uber was still Uber, and it began strangling Portland. It launched just to the north, in Vancouver, Wash. “Hey Portland,” Uber taunted on its blog. “We are just across the river.” Soon Uber started operating in several adjacent suburbs. “They basically forced their way into the market and surrounded us, then put the pressure on for us to do likewise,” Hales later told a conference of mayors.

The city told Uber that updating the taxi regulations could, finally, happen soon, but first the transportation department had to fix Portland’s pothole problem, which required finding millions of dollars in new revenue for the street maintenance budget. Around Thanksgiving, Uber was next in the queue. Uber wanted a firm time frame, which Alpert couldn’t give. “I kept telling them: ‘A little bit longer,’ ” Alpert says. “Strangely, at the last minute, when it was in sight, they were like, ‘Well, we’re done.’ ”

You should read the entire Bloomberg article. It’s a bit lengthy but fascinating in the specifics.  Think about this though.  Uber has proved to be one of the most disruptive companies in recent history. They, just like Airbnb, Amazon Business, and a host of other companies are cutting a wide swath through existing billion dollar businesses.  But their disruption lies not only in the new business model but in their ability to use social media and other digital tools to further their business.

In other words, for any single digital disruption, the disrupted should expect an onslaught like an oncoming freight train rather than a moped.  That’s the nature of disruption.  That makes it all the more important to become proactive in your digital strategy rather than reactive…….

 

 

 

Companies That Didn’t Update for Mobile Paying Price

CMO.com has an article outlining the price paid by companies who haven’t updated their sites to support mobile.   They are making reference to the fact that Google updates their algorithms to give preference to sites that support mobile vs those that don’t.

Indeed, companies that weren’t ready for the so-called “Mobilegeddon” have lost up to 10% of traffic, according to ADI.

“While there wasn’t a precipitous drop among non-friendly sites, the effect is pronounced over the 10 weeks after the event,” said Tamara Gaffney, principal at ADI. “Such continued loss of traffic suggests that immediate emphasis would have been placed on paid search as a quick way to recover traffic. But that strategy is not necessarily sustainable.”

10% is a big number these days and while not as significant as the change Google made late last year to give preference to sites that more regularly update their content, it’s still a big deal.  Notice that they reference “continued” loss.  In other words, Google just made a bad trend worse. But that trend was still there.  It’s become a mobile world and if you don’t support it, you become less an annoyance and more someone people won’t visit………

The CMO.com article also goes into detail on impact to ad revenue for Google based on a per click model rather than number of ads per page.  It’s worth reading to gain some insight.

Sharper Picture of Social Media Influence

McKinsey has a great article on recent research defining the impact social media has on consumers.  While I’ll let you go to their article and get the complete picture, I can say I was surprised that they found that 26% of purchases were influenced by social recommendations.  Keep in mind that a social recommendation counts word of mouth and the sneakernet version of social.

 

26% of purchases are influenced by social recommendations. (tweet this)

 

They also found that top influencers accounted for a disproportionate share of the overall influence. The top 5% accounted for 15% of the recommendations.  What does this have to do with digital transformation?  Consider that companies across the world are still trying to figure out their new marketing mix and whether or not social tools have a place in their budget and outreach.   This highlights that for many companies it does and it’s bigger than originally thought.

McKinseySocial

 

 

 

 

 

 

 

 

It’s worth reading the entire article.

Five Social Media Skills That Move Beyond the Ninja

Social Media Ninja

 

There are a plethora of gurus and ninjas in the social media space, aren’t there? They are early adopters of new social platforms and they can tweet, text and snap at the same time.

But does your company need a ninja? Maybe…or maybe not.

It’s important to be agile and to adapt to new tools and technologies quickly, but those skills are merely the skin of the onion. There are many people that you can hire who can master skills, but when you peel away the layers, what will you find at the center?

These are five skills that will define your business in social media:

1. Empathy

Modern companies must be customer obsessed. Putting your customer first is a nice catch-phrase and it makes for a wonderful mission statement, but you absolutely cannot fake it. You either put your customer first or you don’t. You sincerely want to help them or you don’t.

Customers are human. They have a lot going on in their lives. When they have a problem, they would really like a kind person at your company to listen and understand. Being compassionate towards your customers frustrations doesn’t just make good business, it makes good humans.

Be human.

 

2. Transparency

When someone has a problem, they will often try to contact you offline via phone or email. If you don’t fix their problem, or you make it worse, they may choose to go public. When they do this, respond.

Respond publicly and honestly.

If you made a mistake, acknowledge it. If your product was disappointing, apologize. And publicly let them know that you will fix it. Complaints on social media are a gift. They provide you with insider information about where your weaknesses are and they allow you to show your human side publicly.

Don’t ignore complaints. Don’t be defensive.

Be honest. Always

 

3. Responsiveness

When someone asks you a question on social media, respond…quickly. Ideally, you should be responding within the hour. Most companies don’t. Your customers are talking about you and technology allows you listen in. Let them know that you hear them. Help when you can. Take conversations offline when you need to.

Don’t ignore the chatter. Engage in it.

 

4. Ninja Skills

There they are!

Social media changes daily. New tools pop up. Favorite tools change (or charge). What worked great yesterday may not work at all tomorrow. There is no point in complaining or mourning. This is where you get to be like water and adapt to whatever situation is thrown at you.

The internet will go down. API’s will change. Pay walls will be built. Content will be most important…then images…then video…

Adapt, overcome and mind the gap.

 

5. Connectedness

Social media lives in many different places within a company. It’s part marketing, part sales, and part customer service.

You have many masters to serve, but at the end of the day, your master is your customer.

You can serve your customers best by working well with every team in your company. Customers aren’t speaking to “someone on your social media team,” they are speaking to the brand. The twitter response IS your brand. Make sure it is a true reflection of what you represent.

 

Social media has come a long way in a very, very short time. Technology is moving faster than most people can keep up with. The days of Don Draper sitting down to write one catchy headline that wins over customers everywhere are long over. The copywriter isn’t in the drivers seat anymore.

The customer is.

Let them drive…but pave the road for a smooth journey. (tweet this)

Dorothy in the Land of Big Data

Big Data is one of the enabling technologies for companies to digitally transform either their operations and/or customer  interactions.  However the open source world can be complicated, especially in the red hot Big Data arena. There are a myriad of technologies; some compete with one another, others overlap, some are complementary, and worse of all, some technologies both compete and are complementaryVenn Diagram (e.g. Cassandra can stand alone or run on top of Hadoop, thus it competes, and it is complementary.)

Like a Venn diagram, both Spark and MapReduce can coexist, but a number of their use cases do overlap. (Read more about Spark vs. Hadoop here). On Monday IBM, announced that it was throwing its weight behind Spark (see my blog post here) with little mention of Hadoop. It is easy to see how companies can one can feel like Dorothy in the Land of Oz. However, following a few simple recommendations a company can make good decisions in this seeming fantastical world (view my blog post here).

There is more good news. In this new digital, Big Data ecosystem the technology is pretty pluggable and is becoming more interchangeable. If the focus is on business value that data and analytics can bring to a company undergoing a digital transformation, then a good pragmatic business decision today will result in a good return on your technology investment.

API Security: Common Threats and Considerations

shutterstock_199528379

Common API Threats: spoofing, tampering, repudiation, denial of service, unauthorized access, confidentiality violation

API Security Considerations: 

Identification – Know Your Consumer
The common approach to implementing this is using API keys, which are nothing but randomly generated values that will vary for each consumer.

Authentication – is Consumer Authentic

User-Password over SSl/TSL: the API consumer will be providing a user password to ensure their authenticity.

OAuth – Additional Security by providing token-based access, and the token can have attributes like expiration, which means
any user can perform certain activity for certain period of time and then later on they need to renew or get a new token
depending on what strategy is being implemented.

SAML – Another mechanism for Authentication. Security Assertion Markup Language (SAML) is an XML standard for injecting
Assertions. Typically, the identity provider will validate the user’s identity and insert appropriate assertions to describe things like what application, resource users have access, roles etc.

OpenID is another solution that gives funcationality similar to OAuth and SAML

Authorization – Is consumer authorized to perform a certain action?

Apart from these basic things, one might also want to consider following:

Json Attack: Since most of the API accept or return JSON response, the response can be intercepted in middle. We can have API Gateway taking care of this for all request responses.

Data Protection : Depending on the information being sent or received, we might need to encrypt certain data elements or mask data so that it will be difficult to guess or figure out what they are and what they really mean. For example, PHI or PCI information.

The Human Element of the Digital Transformation

shutterstock_210974194Technology is affording us the ability to do more with less every single day. In fact, as consumers, we’re able to do more with less, every single day, from anywhere.  In an highly electronic world, e-commerce companies are harkening us back to the old “Name That Tune” game show, priding themselves on how few clicks it will take us to complete transactions for goods and services from anywhere at any time.

Such is the root of the Digital Transformation, a term that is gripping not just IT sectors but the e-commerce world as we know it. Trends analyst Altimeter defines digital transformation as “the realignment of, or new investment in, technology and business models to more effectively engage digital customers at every touch point in the customer experience life cycle.” This has led companies to rethink and reengineer their approach to mobile technology, cloud storage, customer personalization, and more.  The importance of IT and Marketing leadership working together has never been more important.

This sounds amazing, and frankly, it is (we’ve come a long way since my first Palm Pilot III in 1997!).  As technical as it is, though, there is a huge human element to digital transformations.  The end customer is the obvious focus here, as he or she must be aware of any new offering, buying channel, or service that a digital company may create.

However, the group that gets overlooked most often are the e-commerce company’s internal employees who must support these new offerings.  The marketing execs may create awesome new ways of reaching their customers, and the IT execs may build ground breaking technology to engage consumers, but if the internal structures and employees aren’t ready and prepared to support the new models, the resulting train wreck will put the company in a position far worse than if nothing had been changed at all.  In these days where customer loyalty is fickle because options abound, can you afford to not be able to efficiently fulfill orders or provide first class customer service?

Have you seen the commercial where the family creates an internet company in the garage and simply can’t keep up when orders start pouring in?  That may be an oversimplified example for Fortune 100 or even Fortunate 5000 companies, but the reality is that an unprepared workforce and inadequate internal structures can cause the best ideas to grind the organization to a painful halt.

The moral to the story is that it’s absolutely critical to have a focus on your internal organization when introducing digital transformation activities in the organization.  You’re asking employees to think, act and perform differently, and that doesn’t happen on its own.  You even may change reporting and/or compensation structures.  None of these changes are small and should not be underestimated.  Change is hard, and human nature’s natural tendency is to resist change.

Frankly, the people side of the digital transformation is not nearly as sexy as a slick new mobile app or even a beautiful new high definition website, but having your employees bought in, aware, and trained, or said another way, ready, willing and able to support the new environment, may be the difference between initiative success and failure, and in a worst case scenario, between company life or death.

Customer obsession: The next wave of competitive advantage

 

Last week, I was fortunate to attend a presentation by Kyle McNabb, VP of Research Strategy at Forrester. He spoke about how empowered customers have given rise to a new era. “The device is not the problem, the problem is what we can do with the device,” he said.

McNabb continued to tell the audience about how the connected consumer is impacting the way we do business. Here are my notes from the session:

 by Record TV (1)

Early adoption is becoming cheaper and easier

Ten years ago, early adoption meant you were willing to spend $2-5,000 on a plasma TV. You were willing to invest your hard earned money knowing that it might not work out, but it might be fun for a while.

Now that early adopter cost is negligible. The cost of innovation and the cost of consumers to adopt it has erroded to zero. That is what is changing the fundamental dynamics of how we engage with brands.
“Technology is impacting every piece of our lives.”

This isn’t about technology. This is about people and how we are changing.

Forrester has 20 years of history about how people are changing.
This is what’s keeping CIOs and CMOs up at night:
  • 53% of consumers agree that price is more important than brand.
  • 74% of B2B buyers start their research online
  • 41% of showroomers end up buying at another retailer
  • 35% of US adults are interested in digital wallets
  • 14% of US adults track their fitness

Customer-obsession is the next wave of competitive advantage.

Read the rest of this post »