When you’re looking to undergo a digital transformation it’s the perfect time to explore where you have opportunities to innovate.
By taking stock and looking at what you can do that is new, different, or simply a better way to do things, you can build new steps and practices into your transformation journey. Here are 3 strategies to help you start innovation, either before or during your transformation.
1. Customer value chain
First, create a map of your customer value chain.
So, what are all the things that your organisation does that contribute to creating value for a customer?
My favourite tool for doing this is Miro, the virtual whiteboard. It’s free to start using, simple, and you can easily share and collaborate on your creation with colleagues.
Even better, it has a couple of useful templates to get you started: one based on Porter’s value chain model and, my preference, one based on Wardley maps, which comes with a handy walkthrough blog post.
Whatever tool you use – and pen and paper are perfectly good, remember these two things; first, no map is perfect, and you’ll need to make some arbitrary decisions about what to include and what to leave out. Second, the conversation and collaboration with colleagues are much more important than the polish of the end result.
Discuss things like:
- What are the activities that really differentiate us from competitors?
- Is our investment in digital transformation going to the right places?
- Are we building things ourselves that we should be buying in?
- Have our processes adapted to make the most of our technology?
- Are our ways of working adaptable enough for different kinds of innovation?
Where are we at risk of disruption and what could we do about it?
From these discussions, you can make decisions about where to focus your innovation, about when to innovate internally, and when to buy in a solution.
2. Customer behaviours
Create a model of your customers’ goals and behaviours and review how well your current portfolio of products and services fits with this. Again, Miro (or similar) is a good tool to use for this and there are several templates you could use:
There’s a simple gap analysis template to use when you start to review your current portfolio fit.
Crucially, remember that you are not the customer – don’t make the mistake of conflating your business goals with the customer goals. Questions you might want to ask are:
- Have customer needs moved on, leaving gaps in your portfolio?
- Are new customer behaviours opening you up to the risk of new competitors?
This review will give you insight into the right innovation mix for your digital transformation.
In other words:
How much should you invest into making what exists more efficient, versus how much should you invest into creating entirely new value propositions?
3. Be agile
Get started sooner rather than later using agile sprints to build, test and learn.
Of course, you could start this by sending everyone on expensive “certified” Agile training where they learn all the right words to use, which is fine. But, in the meantime just remember that the real benefit of agility comes in reducing the time and money spent getting to a valuable outcome.
Get clarity on your desired outcome then work out ways to enable people to make quicker, easier decisions in a “safe to fail” environment with frequent check-ins.
Hey presto, you’re more agile!
Instead of spending a lot of time in planning meetings, get out of the building and put prototypes in front of customers. This will save time and money as the best ideas will quickly rise to the top. Over time you will learn how to reach customer value more quickly each time technology changes, protecting you from disruption and leading to a more sustainable business.
Need help with innovation
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