As an analyst, I try to pick emerging themes and topics around a range of industries and most recently I had a chance to study how Pharma companies are catching up to the digital trends – A latest article by Manhattan Research on “Digital health” 2012 suggests that online health awareness has advanced significantly and the new media tools such as online video, discussion through social media, and use of mobile devices have become most essential to any enterprise and an integral part of the day-to-day lives. It is very clear that customer trends and rising healthcare costs are prompting these pharma brands to put more weight behind digital strategies, though they have a long way to go and fill the gap between where customers are and where the budgets are going.
In reality, adoption of digital technologies should grow a bit faster because customers are becoming more demanding, however mindsets are changing - “it’s great to celebrate a 100 years legacy in the business, but their technology capabilities don’t’ have to match the age of the enterprise”.
Studies have shown that Pharma is just NOT the only industry, facing the heat of this massive transformation, enterprises across various industries have seen their business models affected as they contend with twin forces of technology and globalization.
Most executives say the three major trends in digital – Big data/Analytics, Digital marketing and the use of new platforms, cloud and mobility are top priorities for organization, however McKinsey’s annual survey on the topic also report some tough challenges as in, half of its respondents say their companies’ digital initiatives are either too small to deliver results on their objectives or they lack capabilities to meet their technological priorities.
Most common challenges for business leaders in adopting digital technologies
What C-level executives say - Digital doesn’t deliver?Digital has transformed our universe completely – Not only me and you! I wonder, how it has really challenged enterprises. Once Global CEO, BBDO, Andrew Robertson spoke in one of his interviews with Forbes claiming that he doesn’t really see digital as a technology or new medium – Digital is like learning a new language, something we could use to express ideas and create magical experiences that customers choose to engage in. In my opinion, many leaders fail to take time to assess how comfortable they are with this new language. Learning a new language takes time and dedication – Now, it’s up to you, what is your approach to master this new language?
CEO Nancy McKinstry, Wolters Kluwer says her company’s professional customers have always paid for value information and so when the digital came into reality, what her team found that they just not produced pure information but also developed sophisticated tools that customers can use every day to diagnose patients and to simplify complex tax return. As their customers started using these new digital tools, the retention rates went up, so the digital initiatives have helped increase the value that a company can deliver to its customers.
Ubiquity of digital technologies threatens existing business models?The change is occurring at an alarming rate and many companies are not ready to introduce new business models to keep up with the evolving demands of customers and harness digital capabilities within their existing commercial functions. Whether such digital activities should be centralized or regionally focused and how much online activities should be standardized based on various geography, product or service – Such questions are thought-provoking and creating confusion among enterprises, however leaders need to understand what works out for them, depending on the industry they are operating into. For example if a company’s strength is having thousands of retail outlets, its digital experience should match up to that advantage, not to replace it.
So, is there a single solution to this? I would say – the mindset needs to change, first.
Going onwards, Marketing and IT teams will require a collaborative partnershipCustomers are increasingly interacting with brands via social media and have shifted almost seamlessly to new digital channels but on contrary, enterprises are still in the early days of finding resources/staffing for social media and struggling to analyze social data. We can’t just leave this task to marketers, who have been in charge of social media. New digital platforms are disrupting both marketers and IT leaders – As empowered customers gain more power over suppliers via mobile and social technologies, the ability to consistently deliver positive customer experiences will be critical to success of the organization. Traditionally marketing and IT have been much siloed, however in today’s time both marketing and IT teams need to share joint ownerships and have to be evaluated against the same business goals like higher customer retention or increased margins etc. For example, Marketing should develop competencies with IT to help shift the business from paper-based marketing to digital marketing, similarly IT leaders need to develop teams that can focus on helping marketing leverage technology.
Incorporate digital initiatives into your organization’s strategic planDespite being well informed about the potential of digital technologies, executives find two challenges: organizational structure and lack in their infrastructure and IT in fulfilling the promise of their digital initiatives, clearly show their unpreparedness to take advantage of a data rich world.
Executives will need to focus on building and acquiring skills to carry out their digital agenda. I believe, in today’s organizations, success depends on people as companies struggle/compete for the digital talent not only within their industries but also with start ups. In regards to digital technologies, I think we are all learning more from each other from the amount of cases everybody sees – in nutshell, everyone is experimenting so, what do companies do? Innovative companies should be resourceful in nurturing in-house skills wherever possible as well as creative in setting up processes that fast track for talent to implement their strategies most effectively. Remember, companies where thought leaders are actively engaged and sponsor digital business initiatives, it is much likelier to say their organization deliver more values than the competitors.