Wake up! This is 2018, not 2008.

I always seem to hear people crying to me about how difficult it is to do the right thing in business today. This digitalization is a huge challenge, something really tricky. So much uncertainty. And anyway. You always want to shout at them: Wake up! Welcome to the here and now. In real life.

(Reading time 5 minutes)

About the forest, the mushrooms, the wolf, the horse and the fat meadow

“If you haven’t figured it out yet, it’s going to be really difficult” is what I always think to myself. Where have these people been for the last 10 years? They exist, these industries that have spent the last 10 years in a remote forest, so to speak. Unmolested by the evil wolf, so to speak, and able to pick mushrooms in peace.

Well, the evil wolf will get them all. Some faster and more obvious, others slower, first hidden, then suddenly snarling in front of you on the path.

At this point, my dear readers, I would like to give you an insider tip: The evil wolf is in fact a wild racehorse.

The art in this upheaval is apparently the following: After perceiving the animal as an evil wolf, to realize that it is a racehorse. And then to develop the skill of being able to mount the horse and ride it at a gallop out of the dark forest and onto the fat meadow.

I hope I haven’t already lost you with this little fable. In consulting speak, this would mean: Recognize that digitalization is not a threat, but an enormous opportunity. Develop the skills to use this opportunity to gain a competitive advantage. How boring.

Digital is the new normal

As the basis of all economic activity today, it is easy to assume that the digital processing of simply everything is the norm. Admittedly, this is already more obvious in certain areas and less so in others. But if you are still defining solutions and processes today that do not start from a “digital base”, it is quite simply wrong. There are no ifs and buts.

This does not necessarily mean that non-digital alternatives do not and must not exist. They should just be seen as a bonus, as a tribute to the past with a very limited life expectancy. And this is also how investments must be made.

Securing and keeping things for today, working on the things of tomorrow. It’s so simple in thought, but when I look at the economy, the status quo is so often discussed and what may come, no one can know. Is that true?

No. I have come to the conclusion that it has never been so easy in the history of mankind to develop possible scenarios for the immediate future (2-3 years) and provide them with probabilities of occurrence. This is not because the world as we make it has become more predictable per se, but simply because so much information is freely available at all times. You just have to do the work. Perhaps you can now understand my frustration with futurology, which has somehow become fixated on giving colorful presentations with robotic images instead of working in a scientifically rational way.

Using new technology to reduce customer costs

Now back to the forest. No. It’s simply not difficult to know what to do. The best place to start is with the customer. Think in total costs that a customer has with you.

On the one hand, there are the direct monetary costs that he has to pay in order to purchase a product or service. I can tell you that for the vast majority of products, these are not incredibly important. Other costs are the time that the customer spends using your product and the frustration that using the product generates. On the other hand, there are the concrete, soberly considered benefits and the emotional benefits, the joy, the great feelings that a customer has when using the product or service. The bottom line is the total cost, which must always be negative.

At first glance, it may not seem very intuitive to formulate the benefits as negative costs. However, the longer you engage with the improvement process, the more logical it becomes.

The easiest thing to do now is to reduce costs for the customer by using the technology. My colleagues at VIAC in Switzerland are a perfect example of this. VIAC is a pension product that can be set up and managed entirely via an app.

The conventional/traditional process with such products involves being sent half a forest of paperwork, filling it in with a ballpoint pen and sending it all back. The whole thing takes days and I have to actively take care of it and not forget it. If my part is delayed because I have more important things to do, for example, someone calls me and inconveniences me further. In the worst case, as a customer I’m already annoyed before I’ve completed the product. Nota bene, without anyone having done anything wrong.

A process that is not only lengthy, but also incredibly laborious. The people at VIAC basically did something banal. They simply thought about how they could make each step as simple as possible using new technology. The result is a product that couldn’t be simpler and yet offers much more than the competition. The fact that they also lead the field in terms of direct monetary costs has certainly also helped to make their incredible growth possible. VIAC has what it takes to completely capture the market for this type of pension solution in Switzerland. Existing providers can count themselves lucky that VIAC has not yet invested considerable sums in marketing. But that is only in passing.

What does VIAC have that existing banks and insurers (who also offer this product category) don’t? At first glance, nothing. On the contrary, objectively speaking, existing players usually have more of everything. But what they obviously lack is the mindset to ask: How can we use technology to make a product better for the customer? To reduce these total customer costs? What should the pension product look like in 2018?

A large number of industries that operate completely without this mindset

If I go through life as a consumer with my eyes open, it is made incredibly difficult for me in many places. Think of offline shopping. The list of things that can be simplified with the simple use of technology is almost endless. Unfortunately, retailers have completely missed the boat by focusing on the separation of offline and online customers. This is an artificial scenario. Neither online nor offline shoppers will want to shop in the same way tomorrow as they do today.

The entire financial sector is becoming more and more obsessed with compliance instead of parallelization. There is a growing likelihood that the old-established financial scene as we know it today will literally perish. I hardly ever hear the question “How can we make it as easy as possible for our customers?” in discussions about products with banks. But I feel like I’ve talked about compliance more times than I’ve been on vacation in my entire life.

No. Knowing what to do today is really easy. I claim that I (and many who are familiar with technology) can draw up a 5-point plan for any company with 4 days preparation and 1 day workshop with concrete measures that have maximum impact on these total customer costs. It’s really not that difficult anymore. It’s 2018, so stop posturing with strategic rhetorical questions. It just shows that you’re still thinking in the last decade.

Implementation, phew

Well, “well roared lion” you might think. And you’re right. It’s always easy to write something, work out a strategy and draw up a plan. Adapting reality to the plan, on the other hand, is a real challenge. The wheat is separated from the chaff when it comes to implementation. THAT is really difficult, even in 2018.

And it is so much more difficult to bring about such changes in a large company. The dependencies, the cultural habits, the entrenched relationships – all that is poison for change. Now this is an acknowledgment on my part of why large companies often find it difficult to bring about comprehensive change. But it is by no means an excuse for not tackling this change. Precisely because nothing is worse than doing nothing at all.

And hey, let’s be honest, it’s 2018 and the digital transformation has already happened. Not because everyone is already fully digitalized (what an idea), but because “digital” is now the new “normal”. The new groundwater level in the well of the economy.