Digital Transformation and Digital Darwinism
We at 2SQRS strongly believe that human and tech go hand in hand, and we are sharing our thoughts on the subject, inspired by the inaugural lecture Cold Tech and Warm Contacts by Lotte Willems and Hans Bouwknegt (2016).
Remember how Google introduced Google Chrome with The Wilderness Project in 2010? Or how fast and seamlessly Uber and Netflix became a part of our everyday lives, that we almost take them for granted now?
Indeed, we have seen quite some remarkable tech innovations in the recent years, which have been gradually digitalizing of our lives. Inevitably, this has brought the bar for companies in terms of what is expected from them to deliver to consumers. Moreover, this has raisen discussions on where does tech end and human begin (and vice versa), when in reality the two should go hand in hand.
This is a time of digital darwinism… adapt or die.
Many industries have gone through massive changes, driven by pioneers like Airbnb, WhatsApp and Spotify, in order to stay relevant and engage customers at every stage of the customer lifecycle. This process of adaptation to and new investments in technology and business models is referred to as digital transformation (cf., Altimeter, 2012). In other words, the companies which expand their business and remain relevant to the digital world and the society are the ones which integrate digital technologies like cloud computing, analytics and social. These companies use data to cater for responsiveness in customer needs, values and expectations, and to be able to adapt their business models. As Igor Beuken coined in 2016: “This is a time of digital darwinism… adapt or die.”
Experiences and the human factor
Digital transformation is much more than manifestation of leadership or involvement from senior management. Rather, it is a process of continuous adaptation revolving around a better understanding of the way human beings experience the world and technology. We, as humans, are familiar with the fact that, actually, it is namely experiences which bring value. For example, Netflix brings the pleasurable experience of watching a movie and Amazon - the convenience of shopping from the comfort of our own couch. We use social media to express our experience of anger or frustration about a certain subject. Thus, because digital transformation is focused on experiences, it creates value. And value creation through experiences is human-centered.
Businesses have understood the importance of experiences already a long time ago and some have indeed successfully incorporated experiences as one of their core values. Apart from being human-centered, experiences reflect also on the characteristics by which we perceive that entities are human. These businesses have already understood that becoming successful is about engaging people and that connecting on a human level is crucial for a proper customer lifecycle. Organizations have been thus adopting the human factor and there are 3 types observed:
Sentient organizations - their offerings consist of technically-powered products and services which appeal to customers’ human capacities. This is where the human and the technology mutually reinforce each other.
Human organizations - they strive to look, sound or act human. Like M&M’s human features. Here, the human factor serves the technology.
Personal organizations - they focus on their customers as individual human beings, rather than personas. An example here is the personalization of shoes that Nike offers its customers. Here, the technology serves the human.
Big data and external data sources are crucial for the existence of the sentient organizations. This is how they obtain context-specific knowledge about the customer engagement and its dynamics - they have information about every critical touchpoint and the customer experience lifecycle. Because of this, these organizations are ‘sentient’, meaning that they are responsive and highly adaptive to the environment. This is how they can be relevant and have sustainable relationships with their customers. And this is why the winners of the winners of digitalization are not the giants of a particular industry, but the tech giants - the inhabitants of the digitalization industry. They know so much better how to act in the era of the digital source system, which all industries have acquired. By using data insights on the behavior of the users, companies like Netflix have gained major advantage over the competition. In this case - what the users watch, when they pause, on what type of device, and where. Apart from being responsive to data and acting upon it, another crucial aspect to delivering future-proof products and services is to focus on the user interface. This is where the connection between organizations and users takes place and, in the end, between digital technology and human engagement.
The future is digital. If your company wants to survive, become a sentient organization - embrace the mutual reinforcement of humans and technology, live and breathe data, act upon it, and provide a user interface that your users are craving for. And no, most likely robots won’t make us jobless in the near future. Stakes are higher that they will empower us to do our jobs better, and the human factor will be even more and more crucial for an excellent execution.
Want to read the full paper on Cold Tech and Warm Contacts? Click here.