Businesses all throughout the world were suddenly exposed to an increase in digitization during the beginning of the epidemic. All authority to take any action necessary to keep a business operating was handed to those who pledged to keep things moving.
The digitization lodestar is starting to wane, though, as more people head back to work. Early in the epidemic, investment objectives were well-defined; but, businesses are now faced with the same uncertainty about digitization that they had before.
What is the Business Model Canvas and How Can It Be Used for Digital Transformation?
One of the main difficulties that many firms confront today is managing digital transformation, much like creating novel business concepts. But fortunately, you may learn a lot from each other’s strategies as you innovate your company model and transition it into a digital enterprise.
Genuinely adopting digital transformation does not just include expanding existing paradigms or carrying on as usual with more advanced technology, as is the case with business model innovation.
There’s a chance to leverage the sometimes continuity-focused IT investments of recent years as the foundations for a more true transformation of the firm, particularly as companies throughout the world are now asking what to do with their recent tech investments.
1. An illustration of the existing business model
Organize your present business model by drawing a map of it. You may add a valuable baseline to your transformation efforts by going through the nine components of the business canvas, especially if your present business model has evolved rather than being properly designed. Your present business model’s weaknesses are shown through this exercise.
A firm that creates and manufactures medical prostheses is a nice example. They discovered that the physicians who deal with the patients directly fully mediated their relationship with their end consumer (i.e., patients) when they were required to draw out their present business strategy.
2. Engage in transformational opportunities
The digital transformation consultants by Base22 find strategies for interacting with the transformational opportunities. You can use a ranking exercise to pinpoint the most important factors, after which you can start to progressively implement the required modifications.
Letting go of the status quo has been a crucial component of the talks I’ve had with teams working on digital transformation so that we can better see the transformation’s end result rather than just the process. Additionally, several of the teams used methods of strategic foresight to aid in this stage.
A global producer of specialist construction equipment had to confront the fact that demand for its conventional goods was rising while rivals were able to provide smarter, more networked devices. The business learned after using the business model canvas that the problem they were having wasn’t largely tech-related.
The organization concluded it needed to concentrate its transformational efforts on creating and disseminating an updated value proposition first after carefully considering the effects that smarter and connected goods would have on their business model.
As a result, the project’s emphasis switched from identifying the need for an updated value proposition to integrating smart and linked components into their goods.
Remembering the business model canvas, this stage begins incorporating updates and modifications into your canvas.
3. Make the required adjustments
The third stage is all about coming up with the essential alterations to get from the current situation to the digital aim once you’ve sketched out the goal in the second step. Successful digital changes have been compared to orchestral directing rather than just purchasing the most recent instrument.
It’s critical to recognise the fundamental adjustments upon which the transformation depends, as well as to monitor the ripple effects these changes will have throughout the entire canvas and to be aware of the complementary actions that will be required.
In this sense, choosing the appropriate technology for the job and being aware of its commercial ramifications might prove to be at least as crucial to a successful digitalization as training and upskilling.
A distinct knowledge and vision of what you can now achieve differently are more important. The majority of teams found that making deliberate adjustments to their core operations was necessary to guarantee that technology investments were used wisely and produced long-lasting improvements in the ways value was produced and distributed.
4. Verify that you have reached your goal
Making sure you’ve hit your aim is the focus of the final and complimentary phase. Digital transformations frequently depend on segmenting the entire transformation activities into smaller segments, and they may even turn out to be a continuing activity.
Iterative initiatives must be closely monitored to stay on course, and doing so prevents firms from entering a post-transformation stagnation that gives them a false feeling of stability.
This constant involvement with digital transformation is essential to keeping ahead of the competition, especially when digitizing one component of the business makes you realize that other aspects of the organization need to follow suit.
For instance, limitations on the amount of customers allowed in their businesses during the epidemic originally presented problems for a chain of convenience stores that were mostly situated near transit hubs.
The team’s business model emphasis prompted them to consider their value propositions to individuals “on the go” and pressed for time more thoroughly, even though this may have been seen as a transitory problem needing a temporary solution.
The team came to the realization that launching an app that allowed customers to pre order items to pick them up in-store soon after the first lockdown.
For them, shifting the focus from “what can we accomplish with this technology?” to “how can technology help us achieve this goal?” and concentrating on their business model and main value proposition opened a cascade of changes much beyond the initial digitization of the sales channel.
The bottom line
By using these as a guide, you may retain your attention on business objectives and impacts rather than merely technology advancements if your company is struggling to keep up with the digitalization trend. Impacts of matching changes must manifest in the canvas and its components if digitization is to be really revolutionary.