Smart Digital Strategy Requires Making Tough Choices

by Sue Spaight

“The essence of strategy is choosing what not to do.”

This is both a brilliant statement, attributed to Michael Porter, and a fact that’s far too often overlooked. It’s incredibly easy to fall into the “DO ALL THE THINGS!” trap. It’s eminently harder to make the tough day-in-and-day-out choices required to stay focused and avoid the “initiative overload” that dilutes resources, paralyzes teams, and kills effectiveness. This is true of strategic planning on every level – and certainly true of overarching digital business strategy. 

How to Develop a Great Digital Strategy

In its Winter 2017 issue, “MIT Sloan Management Review” features an excellent article entitled How to Develop a Great Digital Strategy. It posits that the first step in charting digital strategy must be choosing whether to pursue EITHER a customer engagement strategy OR a digitized solutions strategy. It’s a useful and unusual choice to propose, with the authors differentiating between the two in this way: 

“A customer engagement strategy targets superior, personalized experiences that engender customer loyalty. Recognizing the always-rising bar of customer expectations, companies with a great customer engagement strategy are constantly identifying new opportunities to connect with their customers.” Their example of this is Kaiser Permanente, which is focused on approaching health care as a collaboration between care providers and members, using digital technologies to support that approach. 

A digitized solutions strategy, on the other hand, “targets information-enriched products and services that deliver new value for customers. A digitized solutions strategy transforms what a company is selling.” An example of this is Schindler Group, a provider of elevators, escalators, and related services, which is collecting real-time data on the use of its products to improve their quality. 

Choice is Difficult. And Utterly Imperative. 

These strategies often converge, as the authors point out. Pursuit of customer engagement may very well lead to new digitized solutions. Pursuit of new digitized solutions will likely impact customer engagement. The point is, though, one MUST choose. Convergence doesn’t obviate that need.

It’s difficult to accept the idea of needing to choose instead of using both digital strategy approaches … difficult enough that several readers wrote to the MIT publication and objected. I’ve also heard objections from people with whom I’ve shared that article. Why is this choice essential? The authors responded in a follow-up article called Why Can’t We Have More Than One Digital Strategy?

Companies – and individual employees – need a clear focus to guide their innovation initatives and – this is the crux of it all – resolve debates over priorities. In other words, it drives the effective and focused resource allocation that will ultimately make or break your organization’s success.

Regardless of whether you buy into the need to choose between a customer engagement strategy and a digitized solutions strategy specifically, I implore you to focus your resources on a clear and omnipresent strategy. You may have multiple sub-strategies that support your overarching digital business strategy. Just make sure that isn't used as an excuse to throw in everything but the proverbial kitchen sink. “Death by 1,000 initiatives,” as a former boss used to call it, is a slow and excruciating death.  

Put Your Money Where Your Strategy Is 

THIS is important. Please stop and think about it for a minute. It sounds incredibly obvious. And it’s often forgotten, day to day: 

In reality, the strategy your company is actually pursuing is going to be determined not by what you have in your strategic plan, but by where you spend your money and where you deploy your people on a day-to-day basis.

If you spread your resources around too thinly, you might realize some smaller incremental wins. But the BIG, more strategic win will perpetually elude you. Focus is EVERYTHING when it comes to strategy. You simply cannot lead your team through two digital strategy doors at the same time. Pick one and stride through it confidently with everything you’ve got. 

Posted in: Digital Strategy

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