No matter how you define it, ‘digital’ – as a category – is moving at breakneck speed, and is having a steadily deepening impact on your business. Your company’s website, online marketing, social media, content marketing, and cloud computing activities are likely up-and-running in some form or another, but unless you’re at Apple or Disney, these initiatives probably aren’t directly linked to corporate business strategies.
This disconnect doesn’t put your company in an exclusive category, but it does leave you vulnerable at the next board meeting, when a respected member asks, “How would you describe the company’s digital strategy?”
The following list includes five questions a chief executive should be asking his/her top lieutenants to quickly develop a handle on the situation; that is – to get conversational on the subject, and asses the organization’s state of readiness to deal with the ‘digital age’.
Question #1: Who owns the ‘digital’ function at the company?
It’s likely to be either the CIO or CMO, but the question could also initiate a chorus of crickets – that is to say, complete silence. It’s not an easily-assigned responsibility, since it affects most functionality areas of a company (i.e., marketing, sales, customer service, product development, IT), and few organizations have taken steps to codify it. In the early days, digital was dumped on the CIO because the website lived on a server, but responsibility has transitioned over the years to the CMO as online marketing has grown, and will increasingly migrate to a newly-formed Chief Digital Officer role.
What’s most important here in the short term is to have someone responsible for the digital evolution on the business — explicitly defined in a job description. Having the CIO be this person is better than having it float around unattended, but it’s more appropriate to be the CMO at most companies (assuming it will take awhile to create the CDO position).
Question #2: How is the company’s digital platform/performance trending?
In the broadest terms, this means the company’s digital profile, website traffic, digital media mentions, and search engine ranking / relevance.
The internet is being used by an additional 10 million people per month, and existing web users are increasing their usage consistently both at work and home, as well as through mobile devices. If your company’s traffic and presence isn’t trending upwards, that’s a problem.
Question #3: How is the company using the digital medium to collect data on customers, prospects and partners
Google and Facebook cloak these activities in “adjusting privacy policies”. The Global 1000 call it “managing big data”. Everyone else calls is “using web stats to learn more about customer behavior”, and you should be doing it, too. If you don’t, your competitor will, and use the information to steal market share.
Question #4: How are you (we) working digital strategy into the product development process?
Just think about your own behavior as a consumer, and apply that thinking to your own products and services. Would you rather call a travel agent to check out flight availability, or make a quick visit to Expedia.com? How about banking or retailing – do you call a 1-800 number to check the status of a transaction, or log in to some website and get the same information in a 1/10th of the time?
No matter your industry, customers are becoming increasingly reliant on web-based tools and features to do business with their vendors; factor this into the product design process.
Question #5: How does our digital strategy compare to our top three competitors?
How do we match up against features, functionality, promotion, and market penetration? (Translated: How does our website compare, and how much are we spending on web advertising versus the competition?)
Never before has competitive intelligence been so readily available – to both competing companies and customers. Making informed decisions to allocate dollars elsewhere is basic business strategy; being caught unaware on competitor digital strategies is just sloppy.
(Author’s note: this article was first published in January, 2012.)