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How B2B Firms Can Achieve Digital Potential

Seven action points can help B2B leaders counter common myths on digital transformation.

Par Anant Bhagwati

First published on septembre 28, 2017
min


This article originally appeared on Livemint.com. The valuation of digital ‘unicorns’ and the overall high visibility of new technologies such as artificial intelligence (AI) and automation are creating a buzz around digital, often described as the next big thing in business. However, unlike business-to-consumer (B2C) industries, in which channel disintermediation has been the prime source of digital value, the path in business-to-business (B2B) industries is not as clear. Chief executive officers (CEOs) of B2B companies usually struggle to clearly articulate their firms’ digital potential, and typically have to counter several myths on the path to digital transformation. Myth 1: I understand digital is a great enabler, but it’s hard to quantify tangible numbers, which I can track objectively. Not having a clear path to profit and loss (P&L) impact undermines the attention that B2B firms can put on digital. In a home improvement leader, for instance, while customer relationship management (CRM) software had been deployed to make the lead management process digital, it was hard to connect this CRM intervention to sales uplift. But P&L impact needs an “end-to-end process” to become faster and more effective. Rather than point digital interventions, this will need a clear visibility of leads being sourced from external social media sources, accelerated to the mobile CRM system, which is easy to use for the frontline sales force, and finally to deep engagement with consumers until conversion. While digital actions might accelerate some part of the process, unless the CEO insists on seeing the path to increased new sales via digital origination and acceleration, the cash register will not ring. Myth 2: Digital’s value is primarily about e-commerce and transactions. The real value-addition for B2B from digital is likely to be earlier and deeper engagement of customers with the value proposition. Data shows almost 75% of Indians use the internet for early inspiration. This becomes critical for higher-value categories with a long decision-forming process, such as home, car and white goods buying. Read the full article at Livemint.com. Anant Bhagwati is a partner in Bain & Company’s Mumbai office.

This article originally appeared on Livemint.com.

The valuation of digital ‘unicorns’ and the overall high visibility of new technologies such as artificial intelligence (AI) and automation are creating a buzz around digital, often described as the next big thing in business.

However, unlike business-to-consumer (B2C) industries, in which channel disintermediation has been the prime source of digital value, the path in business-to-business (B2B) industries is not as clear. Chief executive officers (CEOs) of B2B companies usually struggle to clearly articulate their firms’ digital potential, and typically have to counter several myths on the path to digital transformation.

Myth 1: I understand digital is a great enabler, but it’s hard to quantify tangible numbers, which I can track objectively.

Not having a clear path to profit and loss (P&L) impact undermines the attention that B2B firms can put on digital. In a home improvement leader, for instance, while customer relationship management (CRM) software had been deployed to make the lead management process digital, it was hard to connect this CRM intervention to sales uplift.

But P&L impact needs an “end-to-end process” to become faster and more effective. Rather than point digital interventions, this will need a clear visibility of leads being sourced from external social media sources, accelerated to the mobile CRM system, which is easy to use for the frontline sales force, and finally to deep engagement with consumers until conversion. While digital actions might accelerate some part of the process, unless the CEO insists on seeing the path to increased new sales via digital origination and acceleration, the cash register will not ring.

Myth 2: Digital’s value is primarily about e-commerce and transactions.

The real value-addition for B2B from digital is likely to be earlier and deeper engagement of customers with the value proposition. Data shows almost 75% of Indians use the internet for early inspiration. This becomes critical for higher-value categories with a long decision-forming process, such as home, car and white goods buying.

Read the full article at Livemint.com.

Anant Bhagwati is a partner in Bain & Company’s Mumbai office.