Does digital have to be disruptive?

Myth: Digital requires radical disruption of the value proposition.

Reality: Digital usually requires using the right digital tools to better serve the known customer need.

Some managers believe that to achieve a digital transformation, they must dramatically alter their company's value proposition or risk suffering a tidal wave of disruption.

As a result, at the start of many digital transformations, companies aspire to be like Apple and try to find a new high-tech core product or platform that will serve brand-new customer needs.

Although some might succeed, I believe that the customer needs most companies serve will look much the same as before.

The challenge is to find the best way to serve those needs using digital tools.

Take the taxi business for instance.

Uber's impact on taxis is one of the most frequently cited examples of digital disruption.

The public remembers taxi drivers' striking around the world-notably including in Paris, in the face of what seemed to be an existential threat to their livelihoods.

But today taxi companies in Paris are thriving.

G7 is a traditional taxi company founded in 1905.

It once had a reputation in Paris, as did many other taxi companies, for its drivers' rudeness.

Fast-forward to the present: Like Uber, G7 has developed an app that allows customers to book a taxi.

The app offers various service levels: sharing, regular cab, green (hybrid or electric), van, and VIP.

You can use the app to hail a car from the curb, or you can jump into one standing at the corner, and you can pay the driver with the app using his or her four-digit code.

But G7 differs from Uber in some important ways:

Its drivers are better trained, the cars are cleaner, and you can pre-book a ride for exactly the time you want it, instead of in a 15-minute window.

More important, although a G7 might be slightly more expensive on average than an Uber, it is vastly less expensive when you most need it: Uber imposes surge pricing, multiplying your fare twofold, threefold, or even eightfold, while G7's prices remain constant.

It's clear that Uber's arrival forced traditional taxi companies to improve their service: G7 drivers now take etiquette lessons.

But it's hard to argue that the advent of digital necessitated a wholesale reinvention of G7's value proposition.

Understanding that digital transformation does not change the reason your business exists will help you identify the technologies you should focus on.

Managers who believe that digital disruption requires wholesale reinvention of the core business end up running in a thousand directions.

But if the challenge is simply to better address their customers' jobs to be done, they will most likely focus on the technologies that have the greatest effect on their customers (such as customer experience or relationship synergies) or their core capabilities (such as cost synergies).

Your company, just like G7, can probably continue to serve the same core customers even in the digital era.

And the needs of those customers won't change-although digital will certainly provide a better way of catering to them.

So, the next time when you think of digital, 9/10 times think of solving known customer needs rather than looking at digital as a medium to bring radical disruption to the value proposition your business provides.

If you want to learn more about such Digital Transformation lessons and take better decisions in your career to stand out from the crowd, meet us on 10th June where we start the new batch of A to Z of digital marketing masterclass.

That’s it for today, folks!

Have an awesome Sunday ahead.

Cheers,

Apurv