DIGITAL IS HERE TO STAY
26 July 2019
MIM-Kyiv hosted a discussion with Mr. Dmytro Chashkin, founder of Cobit-Solutions company which develops business analytical systems and ex-IT director of the Starlight Media, one of the largest national media and entertainment company as a part of Cobraining Day.
Digitalization is coming. Earlier only big companies could afford new technologies, nowadays small and medium ones are heavily in them. It means a more equal field for all those who are doing their best to deliver services up to the customers’ expectations regardless of the size. Such shared economy companies as BlaBlaCar, OLX or Airbnb makes the competition tougher and even kicks global leaders out of the market.
CAN’T WE AVOID DIGITALIZATION?
Recently, the advantages of working digitally were proved by numerous researches. In particular, McKinsey research results confirmed that reinvented incumbents’ turnover was 2.5 the size of their traditional competitors with better EBIT and ROI due to the digitalization. It happened due to the higher digital transformation investment, readiness to self-cannibalize obsolete business-models and digital business-models integration.
BCG reviewed the competitiveness of the digitalized players which no surprise was higher. They are especially successful in launching new products and startups, entering the new markets and manage the costs.
Back in 2016 Match-Maker Ventures surveyed European corporations. 79% answered that they cooperated with startups with two formats of cooperation dominating the corporate population. 30% worked with startups to develop new products and/or enter the new markets and 21% did it for financial gains.
Ukrainian businesses do not seem to be affected much by digitalization, but they’d better think about it before it’s too late. Where to start?
HOW LEARN ABOUT BUSINESS DIGITALIZATION?
MIM-Kyiv hosted a discussion with Mr. Dmytro Chashkin, founder of Cobit-Solutions company which develops business analytical systems and ex-IT director of the Starlight Media, one of the largest national media and entertainment company as a part of Cobraining Day. In the very simple words he answered the most important questions about digital means for business, e.g. why do it; who is responsible for what; which blocks and how to integrate the variety of technologies, what is going, what suitable business models, etc.
Dmytro strongly believes that no business could avoid digitalization nowadays firstly because Y and Z generations are gaining more and more purchasing power and will soon dominate the consumers. They are used to the 24/7 WOW-service. If they are not happy they vote with their money. “They want their unique customers’ experience and they want it quick,” he explained.
Answering the question “Why” is the most critical. Although it may look clear, for many Ukrainian companies it’s rather a PR effort. Such pseudo-changes means transferring responsibility to companies’ marketers.
At the preliminary stage, companies need to research their environments to better understand which technologies are available, regulatory framework and potential digital partnerships. An internal audit could help identify bottlenecks. Then comes IT infrastructure, investment capacity and competencies assessment.
Strategy and planning should be the next steps. They are usually aligned with companies’ overall strategies and ambition. However, digital technologies may completely transform business-model and strategy updates. Monobank, the first digital bank in Ukraine is a good example. Sometimes, such updating affects “only” distribution channels like UBER or Airbnb.
What might be even more difficult is to change corporate culture and HR management. Businesses need people with absolutely different skills set. HR managers’d better be experts in flexible working, and be able to balance it with their companies’ hierarchies.
“Z generation don’t want to go to the dull office. Money is often a not-good-enough motivation. People don’t want 9 to 6 office day. They want to work anywhere and anytime, they want to be a part of something big. Therefore, in-companies’ communications are changing for videoconferencing,” Dmytro said.
Changing the habits of employees and customers is long and difficult. However, according to Peter Drucker, “Culture eats strategy for lunch.” If you want to thrive you shall develop digital culture. It’s “Digital or out!”