Creating a New Value Proposition Aligned with Your Digital Transformation Processes

Abacus Cambridge Partners
4 min readMay 7, 2021
Create New Value Propositions Aligned with your Digital Strategy

Not all corporations begin as digital and data-driven entities. However, all modern organisations will be forced to create new value propositions as the market embraces digital business models. New digital technologies have advanced so rapidly that many corporations are involved in a game of playing catch up with their customers.

It goes without saying that we now live in an increasingly complex world, with a bewildering array of forward-thinking digital technologies. Even customers are often more technologically savvy than the companies trying to push their products and services on them, plus customers expect consistent innovation. In terms of a new value proposition, digital transformations require companies to reimagine their business from a customer’s perspective.

A New Way of Thinking About Business

A McKinsey global survey of business technology shared that many executives believe technology will drive future value propositions. Despite the fact that many still think that IT essentially creates the most value through traditional forms of operational support and business enablement. On the other hand, they also believe that IT will drive business results.

Yet, even in the wake of technological advances, digital transformation has been nowhere near a simple change, regardless of the size of the organisation.

According to McKinsey, less than 10 percent of all digital transformation initiatives create the expected value. In fact, after an unsuccessful digital transformation, some companies have fallen off of Fortune 500 while others make dramatic entries within a few short years. To ensure success, it would behoove companies to partner with an experienced digital transformation partner.

Creating New Value Proposition: Where Does Your Organization Stand?

So where should organisations, seeking digital transformations, look for benchmarking and guidance? At a casual glance, success stories tend to point at tech titans such as Apple, Google, or Amazon.

Many of these success stories are dazzling, glimmering, and often a major focus in mainstream business news. Still, just like the stars in the sky, they are too distant to illuminate the paths of many larger, older, and more traditional companies that did not begin as digital corporations.

Interestingly enough, business researchers at the MIT Center for Digital Business and Capgemini Consulting developed a digital maturity model to demonstrate how corporations respond to various technological opportunities. In the digital era, these opportunities could potentially help create new value propositions.

The four levels of digital maturity level are comprised of: Digital Beginners, Digital Fashionistas, Digital Conservatives, and the Digirati. All these quadrants fall within a scale of either low digital intensity or high digital intensity and high transformation management intensity or low transformation management intensity.

Source: MIT Sloan Management Review

While Digital Beginners may be mature business entities with traditional applications such as e-commerce and ERPs, they don’t seem to fully utilise their available digital capabilities. Researchers believe that their position in this category is purely accidental.

Digital Fashionistas, on the other hand, already have many digital applications such as API management, Robotic Process Automation, Conversational AI, and Intelligent Process Automation — among others. Research indicates that some of these applications may create value, but many do not when they are not relevant to the company’s business objectives or the needs of their target customers.

For instance, there is a wide array of business applications available, but many organisations do not have an accurate digital strategy in place — or powerful guidance — to ensure the right digital transformation, which can then lead to digital maturity. If a company does not know how to capture the real business benefits of various applications, then they put themselves at a digital disadvantage. In and of themselves, the technologies are valuable — but, they need to be utilised strategically for the advantages to manifest.

According to George Westerman, Research Scientist at the MIT Center for Digital Business, digital transformation done right is similar to “a caterpillar turning into a butterfly.” On the other hand, if digital transformation is done incorrectly, “all you have is a really fast caterpillar.”

Digital conservatives are rarely quick to jump onto new technologies before fully contemplating their value, which sometimes works against them. They are more focused on prudence and getting the utmost value of their dollar rather than innovation. As a result, they are more likely to miss out on some of the benefits of new technology in the digital economy.

Finally, the Digirati represent companies referred to as digital natives. They have focused on building a digital culture that welcomes and even initiates digital changes in the digital economy. The Digirati have mastered the art of driving value with the digital transformation.

In Summary

Just on the horizon, many business executives believe IT will create new value propositions by innovating and driving tech solutions that ultimately determine positive business results. In fact, according to the MIT Center for Digital Transformation, companies who have implemented a powerful digital transformation strategy are 26 percent more profitable.

While technology may lie at the heart of digital transformation, companies must recognise the fact that a relevant value proposition — and real transformations — should be driven by what consumers want. Digital natives, such as Google and Amazon, have created enormous value by leveraging changes brought about by their customers’ requirements.
Will your company be next?

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Abacus Cambridge Partners

Headquartered in the UK, Abacus is a technology, consulting, and outsourcing firm offering future-ready solutions to its clients across the globe.