What defines thoughtful investment in digital strategy?
Under pressure to demonstrate progress or replicate another company's success? It's tempting to get caught up in the hype surrounding specific digital tools without critically assessing whether they are the best fit for your business and your unique strategic objectives. But throwing money at the digital gap or the current tech du jour seldom results in real progress.
Formalizing a digital strategy roadmap to prioritize and enable your business objectives is a critical differentiator in modernizing your business successfully. Your roadmap is the foundation for how you grow, innovate, adapt, and compete in a fast-changing marketplace.
The most effective investments in digital strategy are closely aligned with your business' broader objectives and long-term performance goals, which is a philosophical departure from ad-hoc approvals at the business-unit level (often based on narrowly defined use-cases).
Digital strategy as a driver of competitive advantage
Despite a company's determined efforts to entrench technology throughout its operations, our research shows that even a thoughtful digital portfolio isn't enough to guarantee success against the savviest competitors. Leaders need to also think critically about how they're measuring the success of those digital investments to ensure they're rewarding the right behaviours.
For example, if your intention is to invest in technology to support the growth of your business, it's worth spending the time up-front to ensure your project metrics are tied to real improvement in your company's leading growth indicators, which are likely not the revenue itself.
Failure to carefully map your digital investments to strategic leading indicators may result in auspicious initiatives that ultimately fail to move the needle or, maybe worse, discarding promising early-stage ideas before they've had a chance to translate into overt performance metrics.
To help your company meet its targets, consider the influence of the following four factors when evaluating digital investment options, or engage an experienced digital strategy consultant to help you:
- Uncover your pain points. The way forward starts with thoroughly understanding your business environment, challenges, objectives, and change management plan.
- Evaluate innovative options. Consider how solutions work in favour of resources, departments, and objectives.
- Develop a justifiable budget that minimizes frictional costs across disparate teams and projects.
- Measure, refine, repeat. The scale and velocity of the post-pandemic digital shift are massive. Use milestones and metrics, such as operational efficiency and customer experience feedback, to redefine how you measure success and evaluate new opportunities.