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Digital Transformation: Without Guidance You Can Fail When Trying

By Karlo Valentin Rodriguez - Klustera
CTO & Co-Founder


By Karlo Rodriguez | CTO & Co-Founder - Fri, 12/18/2020 - 09:17

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In this article I am not going to talk about digital transformation trends and how the covid-19 pandemic accelerated this “transformation”, you probably have read tons of business reviews or participated in several webinars talking about this. But what I want you to take home after finishing reading this article is a new perspective about what really should be the goal of any digital transformation strategy for a covid & post-covid world.

Back to basics:

In march suddenly our “normal” lives came to a halt, suddenly all the things we take for granted totally stopped and with them the economy also stopped and the biggest financial crisis in modern history started, but think for a bit, what did not stop? what business thrived in the middle of the lockdown? I am not going to mention the industries now because for sure you already knew which ones are, and think a little bit more, did you see a pattern? What do these industries and businesses share in common?  They answer to the most basic needs of consumers and I am not talking about food & cleaning supplies, I am talking about any industry and business supplying to each step of the Maslow's pyramid.  

You may think “this is normal, people was not able to get out home and consume” and it certain way it is true, but not totally related, we are having a very uncommon financial crisis, in past economic turmoils there was a lack of resources to spend but the offer was there, in our case we are living (and I am say living because as today the pandemic is in full throttle) a double sided crisis, consumers do not have the same level of monetary resources as before and also the offer was diminished by the lockdowns, in common terms it was like “I have not much money but also there is no way to spend it”, this mix would be extremely difficult to create without a global pandemic and this made the consumer turn back to basics, back to ensure their most basic needs, but with the lockdown and a general public used to live in a consumption culture this “basic needs” where extended to other areas beyond food and shelter and got into the realm of the digital economy, here are some examples:

Physiological needs: 
The food and groceries delivery industries skyrocketed, yes, because of the lockdowns but millions of new users of these new platforms will remain because they have found the simplicity and convenience of not going to the supermarket and this also means a huge threat for traditional neighborhood markets even after the pandemic is over, if this traditional business do not find a way to make more convenient and digital the purchase process, new generations will slowly forgot about them.

Safety needs:
The global insurance industry growth a 9% (IFC) during the lockdown months compared with the same period in previous years, health and wellbeing became one of the most discussed topics in social media in the same months, insurers react quickly and digitized their offer, making it digital-first and easy to get insured with just a few clicks, many new consumers quickly rallied to get insured in fear of getting sick and have to resource to the public health systems, the pandemic showcased the reality of health in emerging countries and this fear will prevail for some years as long public healthcare get to the point of no saturation and provide same standards as private sector.

Belong & love needs:
Dating apps and communication services saw their traffic and users increased exponentially, for most of the population, the lockdown meant being alone and far from their loved ones, the connection was there, but with no way to be fulfilled other than in a digital way.

Esteem & Recognition needs:
How many podcast, videoblogs, blogs or topic-specific social media accounts emerged or got positionated during the lockdown?  As we were not having the usual interaction with our family, friends or coworkers, any achievement, anything we wanted to show to our circle has to be shared digitally.

Self-Actualization needs:
Online learning platforms saw a huge increase in new customers, some of them because of the boredom of the lockdown, others because finally they got time to take that course they always wanted, but the most important thing is the consumers now realize there’s no need to spend thousands of dollars to get educated and for the new normal an online diploma worth the same as a top college.

And, What needs do my business fulfill?

Regardless of your industry or your business model, if you have a business that already has a digital transformation strategy it means you already have a clear value proposition and product-market fit and at the end of the day it means your business fulfill in some direct or indirect way any of the aforementioned needs, otherwise you won’t be still in business and with a “digital transformation” strategy, we need to get back to the drawing board and detect in which basic need do we fit as a business and how it relates to our business model and the way we make our products and services accessible to our customers with a digital-first strategy as a mantra, otherwise all the investments and actions taken in our business towards delivering a “digital transformation” for the new normal, once we launch it, it will be dead on arrival, because the needs changed and the customers are now aware of it and they love it... 

Photo by:   Karlo Valentin Rodriguez

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