Here is a brief excerpt from an article written by Driek Desmet, Shahar Markovitch, and Christopher Paquette for the McKinsey Quarterly, published by McKinsey & Company. To read the complete article, check out other resources, learn more about the firm, obtain subscription information, and register to receive email alerts, please click here.
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Even as organizations assemble digital building blocks for the long term, they also need short-term, pragmatic moves that meet customer expectations and protect core businesses today.
Digitization is a profound transformation.1When a global bank reinvented its onboarding process for commercial clients, the results included dramatically reduced costs, a market-beating customer experience—and an exhausted organization wondering how ambitious it should be. Could it repeat what it just went through for the rest of its business? How could it possibly do more than one of these at the same time? Would it take years?
Companies that are achieving digitization at scale have found a better way. They have developed a distinct structure that enables them to digitize their most important customer experiences at scale and at speed—in a consistent way, with consistent resources, to produce consistent results. In doing so they transform much of the rest of their organizations, from product and process design through to technology and culture, becoming truly digital businesses.
Crucially, these companies not only understand the digital stakes confronting them—they also act on that knowledge. Think of how consumers behave in the digital world. Most of us will try a new app once, or maybe twice, and if we can’t get it to work, we abandon it. That behavior leaves companies only one or two chances for their digital offerings to make a good impression and win adoption from their customers.
Yet today’s customers do not want digital versions of the same manual, bureaucratic processes they faced yesterday. They search, download, pay, and listen to music all in one go, so why should their electrical service or car insurance still make them run a gantlet of separate steps for searching, price quotation, purchasing, invoicing, delivery, payment, and activation?
Companies that want to win at digital adoption are therefore recognizing that they must reimagine and digitize entire “customer journeys.” These are the beginning-to-end processes that customers experience in getting the product or service they need, across whichever channels they choose.
Streamlined, simplified journeys show impressive results quickly—usually on several fronts at once. Faster mobile-phone sign-ups raised a telecommunications company’s customer satisfaction by 20 percent and reduced costs by 30 percent. For a European lender, time for account opening and loan approval fell from days to minutes, customer-engagement opportunities rose from once a month to three or four times a week, and IT became far more agile, delivering new releases in a month instead of a year (Exhibit 1).
A structure for scale and speed
In much the same way that the leap to digital means rethinking how an analog process works, the leap from transforming a single journey to tackling many at once means rethinking how digitization works. Even as the organization is building the new capabilities that digital businesses require, it must deploy its existing capabilities very differently in order to achieve scale and speed. The challenge is to balance all of the conflicting demands.
In our experience, six critical, parallel shifts combine to make digitization more manageable and predictable. Depending on an organization’s starting capabilities and strategic needs, the amount of effort the elements require will naturally vary. But all six are essential to ensure that an organization actually makes the changes, derives their full benefit, and can keep improving once the changes are made.
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Here is a direct link to the complete article.
Driek Desmet is a director in McKinsey’s Singapore office, Shahar Markovitch is a principal in the Tel Aviv office, and Christopher Paquette is a principal in the Chicago office.
The authors wish to thank Christian Schröpfer and Edwin van Bommel for their contributions to this article.Tags: Christopher Maquette, Driek Desmet, McKinsey & Company, McKinsey Quarterly, Shahar Markovitch, Speed and scale: Unlocking digital value in customer journeys