The Digital Transformation Playbook - David L. Rogers

Are you ready for digital transformation? Well, even blockbuster companies founded in the analog age have found it difficult to adapt and thrive.

Digital transformation is not just about technology, it's much more about strategies and new ways of thinking. This break is inevitable, but change is entirely possible!

To help you transition into this new era, "The Digital Transformation Playbook" by author David L. Rogers, introduces you to the five domains of transformation - customers, competition, data, innovation, and value - and tools to put it all into practice.

Interested in how to adapt to these big changes? Keep reading, and we'll explain to you better how to compete in the digital field game!

About the book "The Digital Transformation Playbook"

"The Digital Transformation Playbook", published in 2017 by author David L. Rogers. Consists of 336 pages divided into 7 chapters that address the changes generated by the digital age and tools for companies to adapt to this new scenario.

"The Digital Transformation Playbook" is recommended by great entrepreneurs and entrepreneurs like Juliano Braz and Gedeon Antunes.

About the author David L. Rogers

David L. Rogers is a director of executive programs at Columbia Business School in Digital Business Strategy and Digital Marketing.

He has authored three other books and lectures on digital transformation, big data, marketing, and related topics in a number of countries.

In addition, it advises and has helped companies like Google, Toyota, and Visa to realize their digital transformation.

To whom is this book indicated?

Entrepreneurs, managers, and entrepreneurs who want to rethink their business, modify their strategies and adapt to the reality of the digital age.

Main ideas of the book "The Digital Transformation Playbook"

• Digital transformation is not a matter of technology but of strategy;
• Companies need to engage with customer networks and discover their needs and wants;
• Organizations need to build platforms, not just products;
• Data must be converted into assets, turning into valuable information;
• Innovation must be accomplished by rapid experimentation;
• Value propositions must be continually adapted to meet changing customer needs;
• Disruption is a reality, and we must know how to respond to it.

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Overview: Explore customer networks

In the digital age, the relationship between companies and customers is changing dramatically. While in the last century companies were based on a mass-market model, today we live a customer network model. Therefore, customers are the first domain of the strategy that needs to be rethought.

Companies then have a new role: engaging with customer networks to understand their relationships and their longings. According to Rogers, these networks impact the marketing funnel at an additional level, called the defense.

At this stage, customers are not only brand loyal, but they also connect it to their social networks.

In this chapter, Rogers presents a recurring pattern of five behaviors that drive the adoption of new digital experiences:

• Access: Customers want fast, easy, and flexible access to data and content.
• Engage: Customers want to engage in interactive digital content that meets their needs;
• Customize: customers aim to customize their experiences and may modify products and services;
• Connect: Customers always want to be connected to each other, sharing opinions, ideas and experiences.
• Collaborate: Customers are interested in working together.

The author also provides a tool called "Customer Network Strategy Generator" that has five steps:

1. Setting goals;
2. Customer selection and focus;
3. Strategy selection;
4. Concept generation
5. Impact definition.

This tool is designed to help you develop strategies for engaging and creating value with networked customers and can be valuable to you!

Overview: Build platforms, not just products

This chapter addresses competition - the second domain of strategy that needs to be rethought. This need for change emerges mainly from the rise of a new business model: platforms.

According to the author by a definition given by "The Digital Transformation Playbook":

"Platform is a business that creates value by facilitating direct interactions between two or more different types of customers".

This multilateral business model has been around for many years. But digital technologies are driving these businesses, facilitating fluid (frictionless) acquisitions, scalable growth, access and speed on-demand and trust.

In addition, these platforms bring benefits such as low asset requirements, fast scaling, cost-effective efficiency and the idea that "the winner takes everything".

The first tool presented in this chapter is the "Platform Business Models Map". This map has the function of

"Identifying all the important parts of a platform and analyzing where the creation and value exchange between different customers and the platform business itself takes place."

The second tool is the "Competitive Value Train" which serves to

"Analyze competition and power between the company and its business partners, its direct rivals and its asymmetric competitors".

This tool shows that traditional competition has been replaced by a network partnership, as competition no longer exists only between companies in the same industry.

Based on this new landscape, Rogers states that companies need to develop an understanding that inter-organizational relationships are a mixture of competition and cooperation.

That is why they have to cope with this change of roles, end the "war" mentality of their competitors and give up part of the value creation process.

Overview: Convert data into assets

The role of data has also changed profoundly. At the moment, they are provided by new and diverse sources and their possibilities are "seemingly limitless" in the author's words. This data is increasingly useful and the biggest challenge is converting it into valuable information.

It can be seen that the market value of many companies, such as Facebook, is based on the value of data it collects about its users and their ability to exploit them. This data has become one of the most valuable assets and organizations need to develop strategies for interpreting it.

According to Rogers, five principles should guide any company in developing its data strategy. They are:

1. Gather various types of data;
2. Use data as a predictive layer in decision-making;
3. Apply data to new product innovation;
4. Watch what customers do, not what they say;
5. Combine data between departments.

In addition, the author addresses the important phenomenon of big data. Typically, a company's data processes are based on structured data. However, big data is really unstructured data and has as one of its biggest sources of social media. To deal with this data, recent technologies have had to further increase their processing capacity.

This data that the business needs can be found outside the organization in exchanging customer value data, engaging key users, supply chain partners, public data sets, and purchase or exchange agreements.

In addition, to convert this data into business value, four paradigms are provided:

1. Insights: revealing the invisible;
2. Segmentation: narrowing the field;
3. Customization: custom-made;
4. Context: providing a differential.

The tool presented in this chapter is the "Data Value Generator" and explains how to apply these concepts to generating new strategic data options in your organization. Five steps are presented:

1. Define impact area and key performance indicators;
2. Select the value paradigms;
3. Generate the concept;
4. Audit the data;
5. Develop an implementation plan.

Finally, David points out that companies still face many data-related challenges, such as building an arsenal of skills, connecting their departments, sharing data with partners, and protecting data from cyber-attacks.

Overview: Innovate by quick trial

According to Rogers in "The Digital Transformation Playbook", innovation can be defined as

"Any change in the product, service, or process of a business that adds value."

This change may be an improvement or it may be the creation of something completely new. Innovation has also undergone many transformations with the digital age and is, therefore, the fourth domain to be analyzed.

For companies to innovate and develop, they must test their products before they can be marketed. In the digital age, these tests have become faster and cheaper. Experimentation is thus defined as a repetitive process of learning what works and what doesn't.

In this chapter of "The Digital Transformation Playbook", David L. Rogers addresses seven principles of experimentation. They are:

• Learn early;
• Be fast and interactive;
• Fall in love with the problem and not the solution;
• Receive reliable feedback;
• Measure what matters now;
• Test your assumptions;
• Fail with intelligence.

In addition, two tools are presented. The first of these is the "Convergent Experimental Method". This method is important for innovating existing products where we are looking for a way to improve them. The second tool is the "Diverse Experimental Method", useful for innovations related to new products.

Finally, the author addresses the organizational challenges of innovation, namely developing a test and learning culture; lead without deciding; involve all sectors and plan to fail, knowing how to celebrate it.

Overview: Tailor your value proposition

The last domain of digital transformation is the business value to the customer. Products must be supplied according to the needs of consumers, which is constantly changing.

Therefore, companies must take advantage of new opportunities to offer value, since if they do not, others will occupy this empty space.

Thus, according to David L. Rogers, companies "need to evaluate each new technology, not by how it impacts their current business model, but by how it will create their next business model."

In addition, the chapter presents three exit routes to a shrinking market:

• Find new customers for the same offers;
• Serve the same customers with a new value proposition;
• Introduce new value to new customers.

Rogers points out that there is no need to wait for the crisis for companies to adapt their value proposition, this must be done at all times. And to help us in this process, the tool of the "Value Proposition Map" is presented.

For organizations to adapt to this challenge, they must have dedicated leadership, know how to allocate talent and money, and not close to new possibilities.

Overview: Master disruptive business models

This last chapter of "The Digital Transformation Playbook" discusses business disruption. According to the author, "Business disruption occurs when an established industry faces a challenger that provides much more value to customers through offerings that traditional companies cannot compete directly with."

This term is very recurrent in the digital age as new technologies are allowing new challengers to take on traditional businesses that have failed to adapt. Based on this idea, Rogers presents the "Business Model-Based Disruption Theory" that can explain how this process occurs.

In this context, two tools are presented. The first is the "Disruptive Business Model Map," which allows us to assess whether or not a new challenger is a disruptive threat in the conventional sector. The second tool, "Disruptive Response Planner", allows us to see what the disruptive challenge will be and how best to respond to it.

What do other authors say about it?

Luiz Guimarães's "Innovate or Die" introduces a proposal that seeks to modernize and innovate companies to adapt them to the digital age, focusing mainly on customers. The work brings reflections that help to better understand the changes and their causes, besides stating that it is not necessary to be a startup to innovate.

In "The 7 Pillars for Successful Sales", Rejiano Vedovatto and Cesar Frazão make it clear that a successful salesperson not only knows that the customer buys a product, but also what value that product adds to the customer. And yet, the concept of value can be perfectly explained by presenting the features, benefits, and advantages of the product.

And if you want to test your product before delivering it to customers, to capture their insights for improvement opportunities, with the "Sprint" book you'll build one in five days. On Monday you will map, on Tuesday you will find some solutions, on Wednesday you will decide, on Thursday you will build the prototype and on Friday you will have it in hand.

Okay, but how can I apply this to my life?

• Develop strategies to engage and create value for networked customers;
• Create inter-organizational relationships of cooperation, not just competition;
• Get data from multiple sources and make it a valuable engine for innovation.
• Test your products before placing them on the market and turn this process into learning for your business.
• Observe customer wishes and do not wait for a moment of crisis to adapt your value proposition;
• Be aware of disruptive challenges and creative ways to respond to them by preventing your business from disappearing.

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