This is a question I’ve thought about for many years.
I’ve worked in teams of five- to launch new digital products; as well as teams of hundreds- to create user experiences with advanced software and platforms. Regardless of the scale of work, many of the concepts of digital strategy described in this article, still applied.
My advice in this article is based on three things: 1) what I learnt during a post-graduate degree in strategy and innovation, 2) what myself and teams applied- based on challenges and opportunities across industries, 3) what worked best from foundations 1 and 2.
Here is how I would distill these learnings:
1. Gather Inputs for your Digital Strategy
Information is everywhere, so gather it. No matter how big or small, however shallow or deep, find information and capture it somewhere. Ideally on a wall, so it can be quickly visualised, as you will then be able to see =just how much information is available. At this stage, don’t be concerned about what the information is telling you…. this stage is just about identifying the ‘data points’.
2. Understand The Current Company Context
When we’re creating a digital strategy, there’s little point developing it within a vacuum. Understanding the target company we’re creating it for is essential.
I’ve seen many excellent digital strategies stall because they were focused on the wrong stage for the company. For example, a company may need get the basics right before moving onto innovation. I’ve also seen strategies with very sound plans fail because they were not innovative enough to challenge and outpace the competition.
Thus it is important to understanding the company’s context. Just like a coach is able to boost performance by pitching their coaching at the level of shape their athlete is in.
3. Map Macro & Micro Trends
Micro trends are those that have a duration of 3 to 5 years, whereas macro trends are longer lasting.
These trends are like water currents flowing through industries. We all know when we’re swimming in currents, it’s far easier to go with them, than against them.
Google succeeded because it spotted issues with its advertising algorithm early on; it responded to a micro-trend in the form of better understanding of internet advertising, within a macro-trend of the rise of the internet and search engines.
Any digital strategy needs to be informed by both the micro and macro trends, that will pull and push an industry, creating prevailing conditions for years ahead.
Within the area of trends, when it comes to digital strategy in particular, I also recommend attention to these three forces:
- Identify existing customer needs, shifting needs and emerging behaviours
- Understand emerging and prevalent technologies that will shape the industry’s future over the next five years
- Analyse the competition, not just for direct competitors but also new entrants that could foreseeably compete in your company’s market
Digital technology is moving so quickly with such disruptive power, such that the above three forces have special importance relative to other trends.
As examples, MySpace came unstuck because it missed the shifting customer behaviours toward private social networks. Facebook acted well to purchase Whats App when it realised instant messaging was emerging as a new technological trend. Uber and Lyft have been embattled as they seek to understand one another’s every move in a competition that is vying for the global marketplace.
4. Deeply Interpret & Analyse The Data
Having built up your data points and understood the prevailing trends, now is the time to interpret and analyse this data. This requires deep thought.
During this stage, ask questions like:
- Questions About the ‘Now’
- What does this data tell us?
- What are the opportunities and challenges that are present today?
- What are the deeper truths of this information?
- Where are our major revenue / profit centres for digital? How are these revenue sources changing?
- Questions About What ‘Could Be’
- Where will action create further growth / revenue / profit?
- Is there anything we can do to magnify returns?
- Are there any areas where we are particularly weak / compromised / threatened? Without action, do these areas pose further risk?
- Most importantly, ask lots of ‘If This, Then That’ questions. For example:
– If trend A, B and C happened at once, more quickly than we thought, what might we do?
– If Competitor B entered this market faster than we anticipated, what would we do?
– If we leveraged this major technology trend, seriously investing in it and it succeeded, what might that mean for our business?
What we’re really doing at this step is building out our assumption base about the future. What we don’t often realise is that we can develop this assumption base through either real experiences or hypothesized scenarios.
This is why surgeons do mock surgeries to advance their skills and why pilots spend many hours in simulators in addition to actual flying time. Study after study tells us, that the process of scenario-based thinking and imagining alternate circumstances, can actually improve the way we’ll respond in real-life situations.
You’ll be surprised how useful this becomes, not just for the act of writing the strategy, but building out what pilots call ‘situational awareness’ for all future possibilities.
5. Clarify Your Major Themes For The Next 2 to 3 Years
With all this information, now is the time to clarify your major strategic themes for the next 18 months to 3 years. Anything longer is too far out. While longer timeframes will be useful for context, most digital plans have a shelf-life of 6 to 18 months in terms of practical planning.
Ideally, you would have five major themes for your strategic priorities, and at most seven.
When Steve Jobs was re-appointed interim CEO of Apple in 1997, one of the first things he did was simplify its strategy. Over the course of the next period, he would reduce the company’s products from 350 to ten core products, announce a direct-to-consumer sales model and also invest in Apple’s re-invigorated computing offering, the iMac. These clear priorities allowed Apple to do something few other Silicon Valley companies have been able to do – disrupt itself – and set the pathway for iPod, iPhone and iPad. An incredible amount of focus, through well articulated priorities, spearheaded this strategy.
Simple examples of digital strategies and priorities might be:
- Double online conversion within 12 months
- Increase self-service by 3x
- Grow registrations by 20%
- Create a pipeline of work based on 100% customer-validated ideas
- Consolidate all digital assets into one major platform
- Create a tiered pricing model for our subscription service
Whatever your priorities, take time to consider which are the most important and articulate them clearly.
6. Define Your Objectives, Priorities and Actions
From your strategies, you can now plan your actions and tactics. These will be the ideas that will bring your major themes and priorities to fruition.
When defining actions it’s important to know:
- what the action will provide to the company and its customers
- how the action will fulfil the strategy
- what uplift (conversion, signups, revenue, etc) the action will realise
- what the action will cost (a rough cost at this stage is okay)
- when (ideally) the tactic will be released to market
- In what sequence will the tactics best be fulfilled (some tactics may be better placed than others, to set the foundation for future tactics)
Once you have this, you can sequence these priorities into a roadmap.
‘Levelling’ of tactics will be important. The digital strategy would ideally clarify major themes and potential priorities, but also needs to leave space for teams to autonomously decide how they will fulfil these tactics. If the level of the tactic is too low, it may encroach on the planning domains of small teams. So the priority needs to be high enough to inform the work of teams, and not so low that it duplicates it.
If there’s one thing that frustrates digital people, it’s being told the solution, rather than the objective or problem to be solved. Digital teams are so often incredibly creative, hardworking and highly specialised; by sharing the digital strategy with these teams and asking for their help to bring it to a reality, it’s incredible what can be accomplished.
7. Review The Strategy Regularly
Remember, the strategy is a living and breathing tool. It requires attention if it is to grow.
While many companies return to their strategy every year, I’ve found the best success is to make it part of regular meetings, so teams are reflecting on it at least every month (but ideally even more often than that). The digital strategy can also complement any planning methods already part of your organisation, such as Objectives & Key Results, which may be part of a quarterly planning framework.
By applying these steps you will think like a strategist. I hope these seven activities are of help- and I wish you the very best with your digital strategy.
