January 22, 2020

Digital transformation strategy: 6 steps for success - TechTarget

3. Lead with a business initiative

Determine your most critical business needs, said Tom Austin, CEO and founder of The Analyst Syndicate.

For example, does your company need digital supply chain transformation to take advantage of newer technologies, such as machine learning and analytics? Once you decide on critical business needs, decide how to address them, and give them a defining name so the goal remains in focus.

"Many an executive sits in mortal fear of the threat of Amazon entering and conquering its business segment," Austin said. "So, they formulate business initiatives to defend and enhance their position vis-à-vis Amazon."

Best Buy, Kohl's, Trader Joe's and Walmart are four companies that created several new initiatives to hold Amazon at bay -- or at least to improve their competitive posture against the retail giant, Austin said. Those strategies were the following:

  • Best Buy decided to defeat or reduce showrooming, which is people checking out the goods in the store before ordering the same on their phones. Best Buy achieved this by creating stores within a store for key suppliers.
  • Kohl's decided to increase store foot traffic and revenue by setting up in-store Amazon return centers.
  • Trader Joe's continued to invest in unconventional merchandizing and supply chain optimizations.
  • Walmart decided to exploit inventory in its vast number of retail outlets to compete with Amazon on delivery and profit.

"Technology was part of the business strategy, of course, but first and foremost, it was business strategy," Austin said.

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