Q. What do you think of the term digital transformation and its validity in 2023?
The term ‘digital’ has become a common currency and people generally understand what it means. However, whether it is correct or not is debatable. When I was at Google, they were trying to avoid the word ‘digital’ saying that we live in a 'post-digital' world, as everything around us - certainly in our everyday personal and professional lives - is done in the realm of digital. So, calling it ‘digital’ is actually redundant.
In that sense, “Digital transformation is not a project, but a lifestyle and constant process of adaptation and evolution in the modern world. It means different things to different people and is a journey, not a destination. Change is a constant feature of the modern business, and survival fitness is more important than standard digital maturity” – as Lazar mentions in the report – Digital transformation is dead. Long live Agility.
There's obviously nuances with different sectors and whether companies still have a lot of legacy operations they're trying to digitise, and if you are a digital native company, so to speak, or a startup, then you're not really transforming so much as evolving.
Well, precisely. This is the issue when the term "digital" is used. It immediately raises the question of what to do with a digital pureplay business. For them, digital is simply a means of survival and transformation to achieve business success, right?
However, it often goes the other way for them. In my experience with Google, I encountered many brilliant individuals who possessed extensive technological knowledge but some of them lacked understanding of people and brands. They tended to view things from a product perspective rather than considering the psychological construct of a brand. It was necessary to explain and teach them the distinction between a brand and a product, as well as how to comprehend the audience they were addressing. This aspect is not typically a strong suit for engineers, right? Hence, for them, transformation entails delving into the human aspects of the world, rather than solely focusing on technology. This is why the phrase "digital" can be misleading and fails to encapsulate what needs to be considered.
Q. I guess we've got the backdrop of recessions, cost of living crisis, consumers feeling the pinch, and businesses potentially having to tighten their purse strings. What's your feeling in terms of whether this is going to stifle investment or actually speed it up?
The transformation will affect both the hesitant and pro-active companies. The pro-active ones will seize the opportunity to not only survive but also gain a competitive edge by adapting and innovating. Adapting to crises and thriving in chaos, as Silicon Valley often preaches, is key. Smart companies mine crises for opportunities and evolve.
In practical terms, adaptability involves walking backward from your market, and understanding changing customer needs and preferences. This drives both efficiency and effectiveness. Efficiency may mean saving time, money, or streamlining processes (doing things right), but effectiveness means doing the right things and getting resonance with customers, so it's a two-way street, benefiting both the company and the customer. This transformation is about better serving customers in better business ways and, in turn, achieving business success.
This transformation process involves gaining insights from the market and adapting accordingly. Case studies abound about how companies rapidly evolved during the COVID-19 pandemic. For instance, in countries like Serbia, small food producers thrived by shifting from physical markets to online social platforms, opening new avenues for growth. Small-scale entrepreneurs tapped into online marketplaces, connecting with a broader audience, transforming their businesses in the process.
Adaptability and transformation are vital for survival and success in a rapidly changing world.
Q. When you are lecturing, are there any examples or case studies you like to drop in? I guess, for example, how maybe COVID was a catalyst for suddenly better services to customers and efficiencies for a win-win?
During the COVID-19 pandemic, many companies quickly adapted to the changing circumstances.
To expand on that example from Serbia, as many people may not know that, the transformation the small food producers in this country had undergone in just a few months was truly remarkable. Serbia is known for its multitude of small food producers, as it is an agricultural nation where food holds great significance. These producers often operate out of their own homes, whether it's individual houses or even apartments. They specialise in crafting a wide variety of delicious jams, pickles, cured meats, and exceptional cheese.
Before the pandemic, their only option for selling their products was by personally bringing them to the local green market, a concept that wasn't widely familiar in the UK. We have farmer's markets, but it's on a much smaller scale. However, in Serbia, the green market is a bustling hub where vendors can affordably sell their goods. It served as their primary avenue for sales and marketing, along with some sales made through word of mouth.
These small businesses faced limitations in terms of growth potential. But during the pandemic, several individuals took the initiative to create online marketplaces, including Facebook groups, specifically tailored for these small-scale manufacturers.
I personally know someone who successfully gathered over a thousand such entrepreneurs from all across Serbia, offering a diverse range of products, including confectioneries and cakes. Suddenly, these entrepreneurs had access to a market of a several million people, all conveniently reachable from a single platform. As a result, many of them experienced remarkable growth, transforming their once modest lifestyle businesses into proper companies that even employed other people.
These individuals, who were often overlooked in the job market, including older women or private groups with exceptional culinary skills, suddenly found themselves in high demand. It’s truly a commendable achievement.
This newfound growth also led to the emergence of new brands, which have now secured distribution in major supermarkets. The online platforms played a pivotal role in discovering these brands and facilitating their entry into the mainstream market. In just six months, the food production scene in Serbia underwent a remarkable transformation.
Interview: Lazar, thank you so much for sharing your story with us.