How digital transformation is rewriting existing business models

Today, digital transformation has shifted from tactical implementation to complete business model transformation. Previously IT may have driven strategy, now business reasons drive strategy with digital as the current prime enabler. In our connected world, the market advantage comes from reimagined business models that adapt to an increased need for digital services. But this shift is demanding, requiring new skills, value chains, and a customer-focused mindset across an organisation.

The gradual morphing of business models vs. disruptive change

The consumers of today are always connected. Since the first iPhone emerged in 2007, the way we connect with friends, work, and brands has changed forever. It underpinned a societal shift to the world we know today, where booking a taxi, hotel room, and any digital service is quick and easy from our smartphones.

Product is now no longer a differentiator when alternatives can easily be found online. Users now want to interact and engage with organisations through digital services. This is both a challenge and an opportunity. Those that meet this need with disruptive business models are thriving – take the example of Uber, Amazon, and Google.

But what does this mean for organisations in today’s data-driven world? According to the Fujitsu Image Scanners Organisational Intelligence Research Report 2020, 86% of organisations across Europe are struggling with the amount of data they have to manage. And with 35% not yet having a digital transformation plan, rewriting business models may seem a long way off.

With the right foundations, however, it can be achieved. Take the example of LCL Bank in France. They were managing a significant volume of paper documents across a specific customer-facing process in their business (18 million items per annum). Their increasingly demanding customer base required digital services and an enhanced user experience. A robust information capture solution was central to them more efficiently handling the huge volumes of data. It enabled them to overhaul their operational process which resulted in a far better customer experience. As the below matrix illustrates this is the foundation of Organisational Intelligence.

Business model transformation reimagines the fundamental building blocks of how value is delivered by an organisation. Process transformation alone isn’t enough. It also relies on organisational mindsets and is rooted in agile workflows, testing and learning, decentralised decision making, and a greater reliance on business ecosystems.

The pace of collaboration, problem-solving, innovation, and value creation is only increasing. New tools are emerging, underpinning innovation which in turn leads to new ways of doing things and new inventions. The key for organisations is being able to leverage those new tools and approaches faster to create differentiated value for the customer.

The future? Domain transformation

Many organisations are taking this a step further for true disruptive change – moving into what we term domain transformation. Where new technologies are redefining products and services, industry lines are being blurred. This creates new opportunities for non-traditional competitors, where new business models are being unlocked beyond currently served markets.

Take the example of Under Armour. The sportswear and equipment brand has successfully diversified to health services, with their portfolio of apps including MyFitnessPal and MapMyRun. With new data-led insights stemming from enhanced Organisational Intelligence, business models can be transformed and even business boundaries themselves can be redefined – regardless of the industry.

As the age-old mantra suggests, change creates opportunity – for those willing to seek it out and act.

Download the Fujitsu Image Scanners Organisational Intelligence Research Report 2020 to discover how to maximise the return on your digital transformation efforts or contact me on mustafa.albinni@uk.fujitsu.com to discuss the report or our Fujitsu Image Scanners.