4 Main Ways to Innovate in a Digital Economy

The vibrant, ever-changing nature of today’s digital economy calls for a light, nimble approach to innovation for companies. When the difference between success and the lack thereof could be defined by speed of action or reaction, how can business owners streamline their processes and operations to think fast and on their feet?

Here are some helpful guidelines that may help you rethink the way you approach problems and opportunities for your business:

1. Leverage Digital Design to Create Products and Services

Today’s business should create new products or product segments and services by pushing the envelope of traditional product performance, with any possible improvements facilitated by digital design.

This way, companies can develop and commercialise various segments of their production supply chain by using either in-house or out-sourced organising mechanisms. Companies such as Tesla, Volkswagen, Boeing, Apple, and IBM are actively operating in this ‘specialist’ mode.

For example, Tesla’s efforts to develop an external arm that produces batteries, Gigafactory, demonstrates a company developing internal capabilities for competitive industry advantage.

Innovation of this nature prevents imitation from competitors, allows companies to attract and retain their top talent, and empowers them to maintain process rigour in an era of increasing design churn.

2. Create a 'Startup' Team

‘Startup’ teams within organisations can be individuals within corporations who are able to assemble the resources necessary for innovation by using intermediate services which provide access to specialised tools and skills.

These teams, which may previously have been expensive to operate within a larger workplace setting, are now more cost-effective and practical to run due to advancements in digital design tools. For managers of more established firms, this mode allows small, entrepreneurial teams to develop new product or service ideas and test them at a low cost.

‘Startup’ teams can also help seed traditional concept funnels with ideas that are light and more advanced in terms of design and concept testing than traditional methods which may require multiple levels of corporate approval to proceed. Speed is of utmost importance in this mode, and the leaner operating team must act quickly to stay ahead of the industry innovation curve.

3. The Data-Driven Customer Experience

Companies, and marketers in particular, should take advantage of the data trail obtainable via today’s consumer behaviours. For example, each time a potential customer swipes on a mobile device screen or post an update on social media, they leave a trail of informative data related to their preferences and behaviours.

Each of these interactions offers potential for brands to gain insight into how to create personalised customer experiences. By combining first and third-party data insights (from social media sites, search engines, etc) in a data management platform (DMP), companies can create a holistic view of their customer base.

This allows business owners to understand patterns and stories that extend beyond their traditional touch points, and discover truths about how their customers interact with the online and offline world around them!

Use these stories and data to create specific targeted market segments and understand your customers on a demographic-isolated level. Many market leading companies adopt this stance when developing marketing strategies driven by big data insight.

4. Embracing Partners And The Value They Offer

To take advantage of the full value of a digital partnership or business network, companies should explore the following:

• Create new alliances: Consider partnering with new associates or even former competitors to offer expanded coverage and streamlined digital processes.

• Data-driven business models: Share your valuable data across digital networks to collaborate better with your most important suppliers and distributors.

• Network of networks: Collaboration across entire vertical markets is key to value creation.

• User experience: Suppliers and distributors are consumers too, and they are becoming accustomed to the digital consumer experience. Business applications should reflect that same user experience by being intuitive and effortless to use.

As opposed to the more traditional, insular models of business, companies today can stand to benefit by sharing data, insights and customer behaviour patterns with their valued partners and stakeholders. In turn, this open approach serves to sharpen the product offering and increase the attractiveness of the company for customers, future partners, or investors as well!

When it comes to the potential of the digital economy, most companies are just scratching the surface. As the Internet of Things drives the surge toward hyperconnectivity, partnerships will progressively become more important. This will inevitably result in the expansion of digital ecosystems, which will ultimately lead to multiple sectors of the economy becoming increasingly digitally interconnected.

Before you set out to overhaul your organisational workflow and processes, get inspired by these clever tricks to exercise your creative muscles. Who knows, a more creative point of view could get the process kick-started on a more productive note!