How to close the value gap

Q

Given all the changes of the past two years, what is the state of enterprise digital transformation today?

A

We have undergone a dramatic and prolonged change in business, the economy, and the world these last two years. Business leaders have been faced with market and talent disruptions, along with rapid business model shifts. Given this turmoil, it's no secret companies are struggling with their digital transformations.

A McKinsey report found that fewer than one-third of transformation initiatives have been successful in the last five years. Yet we know the rate of business change will continue, fueling more transformation investments. In fact, IDC predicts that by 2023, 75% of organizations will have comprehensive digital transformation implementation roadmaps, up from 27% today.

The inevitable move toward a truly digital destiny heightens our responsibility to ensure our customers' transformations create the value they expect.

Q

What is behind the success-or failure-of most digital transformation efforts to date?

A

Business leaders are acutely aware of the graveyard of ill-fated projects, but what they often miss is that failure or success is often determined before implementation even begins. McKinsey found that nearly one-quarter of value loss occurs during target setting, with a further 23% lost during the planning phase.

This means successful transformations start with a comprehensive and realistic assessment to identify opportunities for improvement. These goals set the tone and vision for what success looks like. Leaders can then map those goals to an operating model that makes them achievable and then share them with the organization at large.

Q

Can you explain the concept of the value gap?

A

The value gap is the difference between the value an organization expects from their digital transformation investments and what they actually experience. And in speaking to customers, partners, and peers, I've found this gap to be persistent and nearly universal.

There are three root causes that together create the value gap.

First, many organizations have a difficult time tracking progress and making smart decisions based on actual business value. They're also slow in getting to value, which impacts ROI and drains resources from other transformation initiatives.

Second, businesses struggle with a skills and tools gap. They may lack the right expertise to achieve the expected success, and they're often too busy tackling technical debt to take advantage of new innovations and capabilities.

And finally, even after focusing on innovation and transformation, there's a gap in wider adoption. Organizational change management-in other words, getting people on board-can be the difference between failure and success. If employees don't buy into the transformation, they won't adopt and the initiative will flounder.

Combined, these root causes create a value gap where expectations of digital transformation ROI fail to meet reality and results.

Q

How can software companies better support their customers' need for rapid innovation?

A

It's all about empathy.

Only by taking an outside-in perspective-putting ourselves in our customers' shoes and really listening-can we understand what action we need to take to ensure their success and continued innovation.

At ServiceNow, we've interviewed hundreds of customers in various industries, prioritized what we heard, and then pushed to deliver innovative ways to bring their transformation to life. By putting the customer at the center, we can reimagine and personalize their experience. This allows us to focus on outcomes and get to value faster, using proactive and preventive recommendations and a combination of technology and human expertise to ensure success.

Q

How important is personalization in supporting the needs of your customers?

A

Personalization is incredibly important because every organization is different, regardless of industry.

We as consumers expect our preferred brands to know our preferences. We expect relevant information and recommendations delivered to us at the right time in the right context. We want an intuitive and engaging experience using whatever personal device. So why not take these core principles to heart and use them to shape our customers' experience?

Personalized, by company, by the stage they are at in their journey, by role, and offer relevant recommendations, industry and peer benchmarks, all via a premium digital experience so you can access what you need when you need it.

It's up to software companies to work with customers to provide customized metrics and support to track progress and get to results faster.

Q

When you think about customer experience, what does the future look like?

A

Today, everyone is competing on experience, working to create moments that "wow" and build deep, meaningful relationships with their customers.

Unfortunately, the software enterprise customer experience hasn't fundamentally changed in decades.

Customers deserve better. Which is why we embarked on a structured approach to understanding-and then transforming-our customer experience.

The result is ServiceNow Impact, a new value acceleration solution designed to meet customers with personalized guidance, training, and recommendations wherever they are in their unique transformation journey. By marrying our expertise with AI-driven recommendations and an innovative digital experience, we can create a more personalized and proactive customer journey.

Our solution is unique in that it was built from the ground up with the customer at the center. And isn't that how every customer experience should be? My bet is that once our customers experience ServiceNow Impact, they'll demand the same kind of personalization and insights from every technology partner they work with-and the industry will have to step up.