How to Thrive in the “Digital” Next Normal?

As we emerge from the earliest months of the global Covid-19 crisis, leaders at companies of all sizes are looking ahead to the “next normal.” What will life look like for our customers and our employees? How do we plan, prepare and lead to succeed?

If there is one inescapable word permeating this period of reflection and planning, it is DIGITAL. We know that, worldwide, time spent online and digital commerce greatly accelerated during the pandemic. Daily, we read about the digital-led recovery, enterprise digital transformation, the rise of the Digital Strategy Officer, and a surge in the use of digital platforms and applications among our consumers and colleagues.

Increasingly, digital is not a place or a descriptor. Life is digital and digital describes our lives; the two concepts are inextricably linked. (For some fun, anecdotal evidence, check out Elon Musk showcasing his brain-machine implant, Neuralink.)

For business leaders, the logical extension is that digital strategy is business strategy and vice versa. The two can no longer be separated or disconnected – in our minds or within our organizations.

This shift was well underway pre-pandemic. In January 2019, seven of the ten most valuable companies globally were digital platform business models, the likes of Google, Microsoft, Amazon, and Alibaba. For several years, business analysts have used words like “seamless” and “frictionless” to describe the future.

Undoubtedly, the pandemic has accelerated the seamless assimilation of digital and physical life to warp speed. By some estimates, consumers have vaulted 5 years forward in digital adoption in a mere 8 weeks. For certain sub-groups like seniors or rural consumers, that leap was likely much larger.

The “next normal” is undoubtedly the “Digital Next Normal,” and it is here for every organization. The question facing leaders is how to help yours not only survive but thrive. How to see around corners to spot new opportunities before others do and even create them where they may not inherently exist?

For me, this challenge feels most approachable if it can be broken down into discrete, actionable parts.

Here are 4 guiding principles on my mind as we head into the last quarter of what will undoubtedly be remembered as an historic year.

#1: Understand how your consumers have transformed…

**THEN PUT THEM AT THE CORE OF ALL YOU DO.**

We hear so much about digital transformation; I think it is easy to lose sight of the underlying cultural transformation that is powering it.

Across the globe, people’s daily lives have changed in significant ways. In the U.S., the average adult now spends an incredible 16.6 hours per day with digital media; e-commerce sales climbed 25% in the first two weeks of March and continue to grow at a staggering pace. Digital tech supports a myriad of activities that have been shifted to the home.

A recent Fast Company article dubbed this growing, cross-generational psychographic of digital-first consumers “Generation Novel” (Gen N), writing that companies paying attention will “source the insights necessary to transform and enhance operational and business models, products and services, and customer experiences.” I wholeheartedly agree.

In this moment, “Job One” for leaders is to understand that the pre-Covid customer you think you know is very likely not the same person powering growth today. This reality calls us to update long-held ideas about our customer, rather than falling back on legacy data – especially when it comes to digital attitudes and behaviors.

At the end of the day, the most transformative digital leaders will start by understanding and championing how consumers themselves have transformed.

Black%2Band%2BWhite%2BCity%2BBlog%2BBanner-2.jpg — Fuse data-driven consumer insight…

**WITH FORESIGHT.**

#2: Fuse data-driven consumer insight with foresight

Henry Ford is famously attributed with saying that if he had asked consumers what they wanted they would have gotten a faster horse. Of course they got the Model-T, and the rest is innovation history. We can apply this sentiment to the present to highlight the fact that following the data can only take us so far. It tells us what consumers know they need today, but what about the unmet needs they will discover tomorrow (and the day after that)?

“Foresight” was an innovation buzzword several years back, but interest in imagining the future has more recently given way to innovation powered by data analysis, addressable audiences, and predictive algorithms.

While these tools remain critical, this moment also requires us to invest the time to employ a healthy dose of forward-looking imagination. We need to anticipate the needs and wants on our consumers’ digital-first horizons, then develop thoughtful offerings that meet them where they are headed.

I see a few glimmers of this mindset on the landscape already:

Peloton, imagining that some will never return to the gym is expanding their offer of live fitness content and integrating with platforms like Apple’s GymKit to reinvent the idea of the workout facility.
Travel purveyors, understanding the pandemic will change nearly every aspect of their industry are imagining door-to-door solutions, including biometric airport check-ins, hygiene-class airline tickets, hovering suitcases with no wheels to touch the dirty ground, and robotic hotel maids to provide contactless cleaning services.
CVS, imagining that safety concerns will finally nudge U.S. consumers to adopt the contactless payment systems used widely in the rest of the world, is leading the way to roll out Venmo and PayPal in retail stores.
Lowe’s, envisioning that homeowners will be reticent to allow outside contractors inside for years to come, is piloting an augmented video chat tool that allows them to conduct virtual visits and provide plans and materials lists without ever setting foot in a space.

I wholeheartedly believe that companies who imagine quickly and well will be the winners as we proceed into the Digital Next Normal. I am urging my teams to dedicate some time each week to envisioning what “could be” in the next 60, 90, and 365 days. Won’t you join us?

Black%252Band%252BWhite%252BCity%252BBlog%252BBanner.jpg — 3. Create hypotheses about your digital company of the future…

**THEN BUILD IT.**

#3: Create hypotheses about what your digitally-enabled company of the future looks like, then build it.

In some ways it feels like a lifetime since I attended Davos 2020, but one of the themes that has stuck with me is the idea that we can create the digital-first future of our company (and our world, for that matter) by creating hypotheses about what it could look like.

A key action item for leaders is to envision what your company could look like in the next 5, 10, or 20 years and identify the pieces you need to get there.

As one starting point, we know that shoppers are adopting ecommerce faster than ever during the pandemic. We expect them to retain many of their online shopping habits, with an increased emphasis on safety, personalization, and speed. But, what are the second- and third- order implications of this shift?

Does your organization need to accelerate testing or adoption around:

· Touchless Payment: see Alibaba’s “smile to pay”

· Contactless Delivery: see Covid robot boom and Wal-Mart’s on-demand delivery drones

· Re-purposing Physical Space: see Best Buy turning stores into delivery hubs

· Cloud Computing: see explosion of Google Cloud and Berkshire Hathaway’s buy-in to Snowflake

· Supply Chain Agility: see 4th IR Tech Solutions

· AI Tech for In-Store Personalization: see “Magic Wand” mobile shopping tool at NY Retailer Showfields

Have you done enough to break down internal silos that hamper truly seamless digital experiences?

Do you have the right partners to win in the future? Would many have predicted a few months ago the partnership between Accor & AXA to provide medical care to hotel guests? Or Delta & Lysol to innovate on travel hygiene?

On the precipice of the Digital Next Normal, we must diverge in our thinking and honor the tenet that no idea is too far-fetched. If your team is not evaluating at least a few ideas that scare you, I’d venture you aren’t looking far enough down the road!

#4: Create a fail-forward culture to grow into the Digital Next Normal

Within my organization, the crisis showed us we can move with speed and agility that would have seemed daunting a few months before the pandemic, especially when it came to digital transformation. This was the true embodiment of the “Fail Forward” culture that is easy to espouse but often difficult to practice in non-crisis times.

One of my key takeaways is that you really do have to think like an attacker all over again. Even if you were the incumbent, even if you were the leader before this pandemic, you’re now the attacker, so you must take the steps that attackers take.

Over the past six months, we have attacked by creating new global capabilities and rearchitecting processes—from net revenue management, to marketing as a function, to direct business models—with a focus on delivering our products to market with greater speed, agility, personalization and precision than ever before.

The next challenge is to figure out how to embrace this approach even when the urgency has receded. In my company, this means experimenting with new digital working and training practices, reimagining physical spaces from the factory to the grocery store. And, evolving the roadmap for unconventional partnerships and acquisitions. What does the freedom to fail forward look like for your team?

What’s Next in the Digital Next Normal?

I had a chance to live the prequel of this journey in China, where the 2003 SARS outbreak (among other things) is credited with pushing the county to the digital-first future into which the rest of the world is now embarking.

Thinking back on it, I am reminded that life in that future is dynamic and invigorating. It is full of chances to chase down new ideas, nimbly pivot, and continuously improve along the way.

I am optimistic about the opportunities to re-imagine and re-engineer. Please join me, and let us share successes and leadership learning along the way.