Technology Vendors Need New Approach in the Age of Digital Transformation

Technology Vendors Need New Approach in the Age of Digital Transformation

Technology enablement of digital transformation is not just some combination of deploying mobile, cloud, analytics, social, security or IoT. Every enterprise technology plays an important role in digital enterprise, but technology vendors will have to make adjustments in eight key areas in order for their solutions to be appealing to digital businesses.

1- Metrics. Technology vendors need to clearly communicate what metrics their solution can improve, set realistic expectations for improvement and provide proof points extracted from their current install base. More importantly, when dealing with organizations that are going through digital transformation, vendors need to get a good understanding of what business goals organizations are looking to achieve and how they measure their success and be able to tie deployments of their solutions to achieving those key goals. This would lead to vendors having to answer a “so what?” question when pitching their products in a fashion that is different than what we were used to in the past.

2 – Messaging. For years, vendors CMOs have been struggling to find the right balance in their messaging between the focus on features and functionalities and a higher level, more strategic message. The challenge was that a higher level message would make them look and sound like everyone else in their industry, while leading with features and functionalities would make their offerings look like “tools” or a point-solution, which makes it more difficult for folks that are signing a check to understand why they need it. Digital transformation brings both good and bad news for CMOs. The good news is that they don’t have to face this dilemma anymore as their messaging should be around how their solution can address key goals of digital transformation and improve a new set of metrics that digital businesses care about. The bad news is that this is a brand new game for many marketing professionals and it will take a lot of learning about their potential customers until they get their message right.

 

3- Capabilities. Even though the role that technology plays in digital transformation is much more than its features and functionalities, competing in digital economy is putting even more pressure on technology vendors to innovate and continuously improve their capabilities. Being agile, innovative and customer focused are some of the key goals of digital businesses and they are expecting the same from providers of technologies that they are using.

 

4- Usability. DEJ’s research shows that some of the key attributes that digital enterprises are looking from technology solutions are: 1) to provide value to multiple job roles and groups in the organization; 2) interoperability with other solutions deployed; 3) ability to be used by non-technical staff. One of the biggest barriers for successful digital transformation is an organizational culture that operates in silos and hinders collaboration. Additionally, many digital business are allowing decentralization of purchasing decisions and allowing staff, with little or no technical expertise, to make purchases of technology solutions that can enable them to provide more personalized services for their customers. Solutions that are easier to use, can be effective in more use cases and benefit more stakeholders, have a stronger chance to get on the radar of digital enterprises.

 

5 – Deployment and management. Time to value was one of the top selection criteria that organizations reported in DEJ’s survey. Also, as more organizations are adopting the RGT (Run, Grow, Transform) model for budgeting technology investments, they are looking for solutions that will allow them to reduce “R” portion of their budget so they can allocate more resources to growth and transformation. Solutions that are easier to deploy, have low total cost of ownership (TOC), require less “hand holding” from vendors, can provide immediate value and can keep up with progress of digital business are more likely to be appealing to these organizations.

 

6 – Use-case based approach. The path to becoming a digital enterprise is different for almost every organization and there is no cookie-cutter blueprint for how successful digital transformation should be conducted. Therefore, when working with user organizations that are going through digital transformation, technology vendors should be leading with proof-points about their effectiveness in specific use cases as well as with a range of use cases that they can support, as opposed to communicating the generic effectiveness of their solution.

 

7 – Transparency. Working with user organizations that are looking to become digital businesses is a different game for technology vendors than what they are used to. In order to be truly effective in helping their clients, vendors need to be able to form true partnerships with these organizations and gain their trust, so that they can really learn about their business and the goals that they are trying to achieve through digital transformation. The best way to gain that trust is to be fully transparent with their clients, especially when it come to things such as pricing, total cost of ownership and a product roadmap and, also, have more of an “under promise and over deliver” in their sales approaches.

 

8 – Sales process. Two of the top items on agendas of organizations that are going through digital transformation are: 1) improve skill sets of their employees; and 2) improve the sales process through personalization and more meaningful customer engagement. Technology vendors that are looking to work with these organizations must be willing to set the same goals for their own organizations if they want to be successful in getting traction with digital businesses. The old approach of creating a sales funnel through lead-generation, nurturing and qualification gets a new dimension when dealing with organizations that are committed to digital transformation. Sales leaders should be prepared for having different types of conversations with prospects, talking to different job roles, different procurement and approval processes, different types of customer relationships and different post-purchase evaluation cycles. Dealing with this different looking customer journey (from understanding a need all the way to post purchase evaluation) that is characteristic for the age of digital transformation requires a new set of skills on the vendors side as well as changes in how the sales process is being planned, executed and managed.

About The Author

Bojan Simic

Bojan Simic is Founder of Digital Enterprise Journal, a media and research firm focused on digital transformation and the business value of technology deployments. Bojan has been an analyst and entrepreneur in the enterprise technology industry for more than 10 years.
As an industry analyst, Bojan has surveyed and interviewed tens of thousands of IT and business professionals from end-user organizations and has published more than 100 research reports. Bojan is frequently quoted in leading industry publications and he has presented his research findings at hundreds of market facing events.

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