In part three of the Digital Solutions Stack series, CEO of Innovation Platform, David Swank, discusses how organizations can begin to create digital adoption in a way that doesn't disrupt the overall business model. Get advice on how to make a smooth transition from the C-Suite to the field operators when making a digital transformation by reading the full transcript below.
David: Welcome to another edition of The Digital Change Podcast. We're glad that you joined us today. We are in the midst of a five-part series on the digital maturity stack that we call the digital solutions stack here at the Innovation Platform. This Digital Change Podcast is really all about achievable solutions, impactful results and meaningful experiences. Last week, we began this series of the digital maturity process or digital maturity stack in talking about digital strategy planning. If you didn't have the opportunity to join us, we actually began to talk about this digital maturity in the context of as an organization or as a community, have you really begun the process of looking at and engaging your organization and its capabilities to confront the contrasts and challenges that are facing us in this new digital era? We talked about from an operational standpoint, have you begun to understand your current processes? How are those processes going to be impacted by the digitization of everything? How is your customer interface going to change as customers begin to demand more information and more access to the experience with organizations and service providers that they work with? Lastly, we talked about the financial investments. I want to begin today in revisiting the last part of that digital strategy planning process and that is really considering our financial investments. What drives our financial investments?
I shared an article last week from Navigant that spoke about the Energy Cloud 4.0. In that article, Navigant pointed out that today businesses are represented by four types of business models that drive their financial investments. This first, being an asset builder. Secondly, a service provider. Thirdly, a technology creator. Or the fourth, being that of a network orchestrator. The article pointed out that at each of those levels, scale was achieved at higher levels and profit margins increased as you went from an asset builder, all the way to a network orchestrator. Today, as we think about the idea of what type of business were in or what we invest in, because what we invest in, many times, demonstrates what we believe our company represents. I would advocate that many organizations have lost sight of their ‘why’. James Allen made a statement that said, “Until thought is linked with purpose, there is no intelligent accomplishment”. So, when you think about that last week, we really begged the question: Are we thinking? Are we giving thought to what our organization looks like in this new digital era? I shared insights from John C. Maxwell's book called Thinking for a Change where he actually posed questions about are we big picture thinkers, are we creative thinkers?
Today, we begin in this second stack of the digital maturity. In talking about linking those thoughts to purpose. Today, we're going to begin to talk about digital access and adoption, but the question is what's the purpose of having access today? To having access to digital? What's the purpose of increasing the adoption rate or accelerating the digital experience in our organization and within our customer base? Some key elements that we're going to talk about today, as we unpack this second level, is have we, as organizations or communities, done a digital inventory? Truly understanding and knowing what our inventory consists of in regard to not just data digital devices and so forth. We'll begin to talk about that a little more clearly as we get into this discussion today, but also we're going to talk about internal access to data and digital experiences. We're going to talk about the customer access and then we're going to conclude by talking about the digital adoption and how do we accelerate that adoption. Again, I want to pose the question and go back to the purpose. The purpose or the why in which we began to not only access data, pursue this digital economy and this digital era.
A book that I recently read was given to me by one of the board members that I used to serve, an outstanding board member who really appreciated the idea of strategy and planning. It was a book from Simon Sinek called Start with Why and I think it really begins to set the stage for our discussion today as we think about why we begin to look at digital in reference to our organization. Begin to understand if we're going to apply some of these transformational technologies to organization how do they complement or allow us to really stay true to why we exist? Why we are there to serve our customers, our clients and in the case of a cooperative, its members. Simon made the comment that people don't buy what you do, they buy why you do it. He went on to talk about this Golden Circle where the outer ring is your what, the next circle is your how, and the target that middle circle being why you do what you do. He made this statement when most organizations or people think, act or communicate, they do so from the outside in. From what to why. For good reason, they go from the clearest thing to the fuzziest thing. Think about when people meet you for the first time. Many times, they ask what is it that you do. They rarely ask what is it that you believe or why do you exist, for example. They ask what you do because, a lot of times, we choose the what to define who we are and in many cases, who our organization is. We say what we do. We sometimes say how we do it, but we rarely say why we do it. That's where it is so important that we as an organization begin to think about the why. Simon Sinek went on to talk about the example of Apple.
Apple is a computer company, a consumer electronics company, a smartphone company. These are all expressions of what Apple does. If Apple only identified itself with ‘what’, you might rightly ask what the heck is Apple doing in all these disparate industries. But Apple doesn't start with what. They start with why. In the early 2000s, Apple started a campaign to communicate the ‘why’ called Think Different. In the case of Apple, they're buying the ‘why’ of think different, of challenging the status quo, of being an innovator. I remember for years, you would see Steve Jobs get up on stage and introduce the next innovation from Apple and it captured the attention of a nation. People were beginning to be intrigued by what is Apple going to do next. They represented more than just what they did but the ‘why’ of thinking differently. I would share with you today, as we really begin to consider digital access and digital adoption, that at Innovation Platform, we believe in order for digital access and adoption to be effective and provide the outcomes that you're looking for as an organization, you must start with being real. That's really our why that Innovation Platform is being real. Being real about the exponential change that is happening in our economy. Being real about the disruption that is taking place.
This article from Navigant that I shared with you last week, one of the things they advocated or suggested that utilities in particular need to do is to begin to look at various scenarios that are going to empower their organization. They talked about not just disruption, but they use the word massive disruption. In other words, even to the degree of revenue streams decreasing maybe up to 50%, what would that mean to an organization if their current business model began to shift in dramatic ways. It means being real about the situation. I have used the statement before, ‘That that is is. That that is not is not. Is that not it. It is.’ Today, in a world where we say things like reality is not reality. Perception is reality. In a world where we have video games and things that really drive the imagination, which on one side is very positive but on another sometimes it keeps us from being realistic about where we're at and where we need to go. Again, I would really encourage you, as an audience, to think about, in a very real way, what is happening in your organization from a digital standpoint. Why is it important to begin to provide your employees, your customers, your clients and your ecosystem a digital access? Why is it important that we accelerate the digital adoption? Those are important questions.
On this idea of reality, I'll share with you a story that I think makes this point. A golfer who had been playing badly went to a psychiatrist who told him to relax by playing a round of golf without a ball. “Do everything you would normally do, but use an imaginary ball,” advised the psychiatrist. The golfer tried the next day. He stepped up on the first tee, imagined he got a 260 yard drive, made a fine approach shot to the green, and then he put it for par. The round was just going splendidly as he approached the 18th hole. He met another golfer playing the same way, no ball. The other golfer had been to the same psychiatrist. They decided to play the last hole together and bet $10 on the outcome. The first golfer swung at his imaginary ball and announced that he had gone 280 yards right down the middle of the fairway. The second golfer got up to the tee and matched the drive. The first fella took out his 5-iron as he approached the ball. He hit the ball on the green. He spun it back, it went in the hole and he looked at the other golfer and said, "I win". He looked at his partner who just hit the ball and said, "No, you don't. You hit my ball."
Imagination being unrealistic. In many ways, we go through life and this is a humorous story, but it really depicts how sometimes we tell ourselves stories. The book Crucial Conversations talks about that explicitly. When we are in the world of trying to engage people about issues and challenges, we use a lot of what we call facts, but they end up being more opinions than they are evidence-based. Moving in this data world really is about being evidence-based. Being more factual. Being more realistic. It is so important today that we understand that the reality is not an imaginary game. That it is a real game. We're not playing with house money. We're literally being depended upon by consumers, by members and by constituents to make very strong decisions based on reality. The stakes are high. The impact is real. The consequences are very impactful to the trajectory of our organization and to our community. So, when we hear statistics like 63% of executives revealed that the pace of technology change in their organization was too slow, those are real indicators. Real facts in which we're left with what do we do? How do we move forward? Again, at Innovation Platform, we believe that we have to be real about what those actions look like. Today, as we talk about digital access and adoption, those are real purposeful actions. Real purposeful activities. But how do we go about that?
I would ask that you consider this idea of real, R-E-A-L, in this way. One, as we really look at providing digital access and accelerating adoption, we need to ask ourselves is it relevant? Is the information relevant? Is the data relevant? As we look at the new economy, the digital economy which means the idea of economic development. How we do economic development in our communities is changing? I actually saw a statistic in the last few days from the U.S. Census Bureau from 2017 to 2018 on the population changes throughout the country. It demonstrated that we are seeing a continual decline in population throughout many of the rural communities. Urbanization is happening. We have to be real about what is it that is attracting people to urban areas. Why is that a trend that is happening? How do we begin to make areas in which we live in relevant so people will want to live, work and play in these communities, especially those of rural communities? Be engaging. How do we make the data and information that we're going to make accessible and engaging? We have many disruptive forces in technology today. Those disruptive forces have the ability for us to harness them and capture them for value. Are we agile? Agile and using data to create new methods and new practices. If we're going to provide access to our employees and our consumers, how do we look at that data and be agile about changing processes and methods, even perhaps changing our business model so that that access to data becomes more meaningful for those who are accessing it. Lastly, leading transformation and really connecting people to the next greatest thing in the co-operative world. Most everyone's familiar with a book called The Next Greatest Thing and what the book was all about is how electricity transformed rural America and therefore, it was called the next greatest thing.
I've always said that one of the things that made me proud about being in the co-operative world is we are pioneers. One thing I hope doesn't happen is that no matter what industry or business you're in, you don’t lose that pioneering spirit. Technology has always brought about change and brought about opportunities for positive change for those who are pioneers who can capture and harness that change. It's important for us to be a part and as leaders to lead that transformation and to be real about some of the challenges. I would just point out two of those challenges before we really talk about the key elements of this digital access and adoption stack in the digital maturity process. One is the challenges internally from our employees to board members to those who are part of the internal processes. There's a book called Change the Culture, Change the Game. The author talks about this pyramid of you've got to start with experience. Experience leads to belief and belief leads to actions and actions lead to results. How do we begin to provide meaningful experiences to our employees and to our board in accessing data and making sure that that data has value and has something that is a meaningful experience for that individual? I think a challenge we're facing internally is the education process and the training process. We get so caught up in allowing the urgent to crowd out the important. It's going to be vital that we begin to create opportunities for training and education for employees not only to understand the value of data, but to also understand how to access it. How to engage that system of whatever application we're having them use for those purposes. Then, also how do we move from complicated systems to more simple process or simple methods of accessing data. Big data itself is an extremely challenging task. How do we begin to take big data and turn it into not complex systems, but more meaningful opportunities? I like the statement that we're drowning in information but starving for knowledge. That's one of our tasks. How do we create a system of systems an innovation platform? We're going to talk about that next week as we talk about the digital platform component. How do we start creating a system of systems where we really can begin to manage big data?
Another challenge that we have to address and consider is the challenge for our customers and for those that we serve. How do we take this big data in digital era and the digitization of everything and begin to make that meaningful to the customer? One of the things we must recognize is that we are competing for the customer's attention today more than we ever have in the past. In the early 90s, I was at a meeting where we were talking about deregulation in the utility sector. One of the speaker's made the comment that I believe is a big truth today that when we lose the meter because the meter is the connection to the customer, we're going to lose the customers loyalty. Lose the customers attention. We're going to be competing in ways we've never imagined. Flash forward today and look at the Internet of Things. Look how many connecting points that customers have in their homes in smart buildings and really allow them to begin to put the customer in more of a control type position. We find that whether it's Google Nest or the list goes on and on in which these various Internet of Things, these appliances, are beginning to really do functions that at the utility sector are used to perform. It's going to be important for us to know that one of our competing challenges is competing for the attention of our customers. Those who have traditionally been in a very controlled environment. We're going to have to be intentional about targeted and education campaigns with our customers and clients. Helping them not only understand the value of the data and the experience we provide, but how it can really improve their quality of life and the value proposition that we provide. Also, what we prepare to provide the customer support beyond the meter, if you will, to begin to have the customer understand how we are not just connecting to them but we're connecting them to the grid edge, as many would say. These are just some of the challenges and there are many more challenges, but the challenges of how we connect employees and customers to this digital access and this whole desire to create digital adoption.
Someone once said, “Challenges make life interesting, but it's solving those challenges that give life meaning.” I believe, today, we have the opportunity to bring meaningful experiences to people by capturing this digital error. Let's jump in today, briefly, to these key elements of this digital maturity stack and the digital access and adoption, the second stack if you will. I would tell you these are the key elements that really are going to have to be performed by organizations and communities in order to create purposeful, achievable, impactful and meaningful experiences with data. First, we must do a digital inventory. Secondly, we must think about the internal access and access points, the customer access, the ecosystem access and then begin to think about how that accelerates the digital adoption. Let me just briefly touch on each of those. First, on the digital inventory, the question for us is do I know all of my systems. Not only all the systems I have in place, but applications that contain, hold and collect data. Do I know all the data that is within those systems? Do I know all the devices in my organization and where people access the data? Do I know all the intelligent, collected points within my organization sensors? Am I aware of all the digital communication paths and digital communication channels in my organization? When we talk about doing a digital inventory, these are the elements that we're speaking of. When you think about internal access, it's about making sure not only do we have the data structured, but that we're giving the data to the right people at the right time for the right decision. That is so important. There's a cartoon I saw a few months ago that had a group of people sitting around a table and it said, ‘Let's shrink big data into small data and magically hope it becomes great data.’
One of the things that big data represents is an opportunity for us to take more data, to ingest that data, to digest that data and begin to leverage that data for great purposes, for real, meaningful experiences. But how do we do that? Well, you have to first define the data that's available and the audience. In this case, we're talking about internal. Who needs that data? What actions can be taken by those new insights? Just providing people data is not really what we are striving to do. What we're striving to do is provide them data with new insights that lead to more efficiency, more productivity and greater opportunities to deliver value. What processes can be impacted by increasing these access points? How do we eliminate steps of processes, automating processes? In other words, this is when data becomes great data. This is when big data becomes real value. Let's talk about customer access. On the customer access, it's important for us to begin to recognize that customers are no longer basing their loyalty on price or product. We're seeing today that instead; they're basing their loyalty on companies who provide them an experience. An experience, in many cases, are based on data. Look at the experiences that people have in the palm of their hands, today, with a mobile phone. The mobile phone is transforming so many experiences for the customer. Our question is instead of focusing always on price and product, how do we begin to transition and begin to think like the customer? Gartner predicts in some recent survey that by 2019, more than 50% of organizations will redirect their investments to customer experience innovations. This goes back to earlier my discussion about being a network orchestrator. If investments are beginning to be focused on customer experience and my organization or my community is not doing that, how does that put me in a less of a competitive position? How does that put me in a position that I'm not as relevant to my customer or to my clients? Why do we improve the customer experience?
We need to do it for purposes of customer retention. We need to do it to improve the customer satisfaction. We need to do it to increase possibilities for new service offerings and also our ecosystem access not just employees. How do we make sure that they have access to this data? For decades, our supply chain has been based on supply focused models. Where we're moving today is more to demand focus models where we're providing into that supply chain but perhaps the supply chain is adding more value in our offering to our end user. So, how do I look at my ecosystem and really begin to expand on how that ecosystem helps me to deliver the final value proposition to my customer? Goes back to that idea of network orchestrating. In conclusion, we talked about as we think about the purpose and the why of digital, as we think about the why we would want people to have access to data, the why of people accelerating digital adoption, then we really began to affect change. You really began to affect change in our organization. Begin to affect change in our communities. This is the second stack of the digital maturity process. Next week, we're going to be talking explicitly about what we call the digital platform. The first week, we spent time talking about digital strategy planning. Understanding our capabilities. Understanding our internal operations and our processes. Understanding the customer interface as it stands today. Beginning to look at how are we going to invest in the future today. We've talked about the second stack of the digital maturity process.
That second stack starting with how do we know our inventory of our entire digital experience? Do we have that documented? Do we have a baseline understanding? Do we then know how we're going to take that inventory of both data and devices and begin to leverage that for internal access and accelerating the adoption internally? Do we you know what that looks like? How do we take those investments, those assets of the digital inventory and begin to actually move those into scale for our customers and our ecosystem? Are we leveraging the ecosystem? Are there new value propositions and opportunities by engaging in our ecosystem? How do we begin to integrate them into our platform so that they become a part of that end result to our customers, our clients and our potential revenue streams? Then, what are some of our strategies as it relates to digital adoption? And on that digital adoption, we have to address things such as security of data, how we provide advanced visualization, how we bring things into a single view, and how we create mobility. I hope today is giving you additional insights into this digital maturity process. Again, next week is a very important week as we really begin to talk about a digital platform. A digital platform that really allows us to scale. A digital platform that allows us to begin to move to achievable solutions, impactful results and also meaningful experiences. I want to close by sharing with you a story that makes the point of how it’s important that when we get to this point of the digital maturity process that we are beginning to create a belief in our ‘why’ and a belief in where we're going.
I'm reminded of a story of a pastor who asked one of the individuals in his congregation, “What do you believe?” The individual responded, “Well, I believe the same as the church believes.” He asked him, “What does the church believe?” “Well, they believe the same as I believe.” Seeing he was really getting nowhere the pastor said, “And what is it that you both believe?” And the gentlemen responded, “Well, I suppose the same thing.”
I share that with you because I think one of the challenges in this digital era and one of the great challenges of this magnitude of change that is happening is knowing. It is truly understanding and believing in not only what your current status is, but where you're going. Again, these first two levels of the digital maturity stack that we've talked about are really built on that idea of thinking, very big picture, thinking creatively. The second stack is about why am I really pursuing the digitization, the digital economy. We're going to be talking now about how do we begin to truly build a digital platform. It will require a strong belief in how do I begin to build a platform where I can transform my organization and become relevant, become engaging, be agile and also lead this transformation? Thank you for joining us today and we look forward to visiting with you again, next week, as we continue this series on digital maturity.
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