Athens International Airport

Creating a Digital Strategy

Presented to: Athens University of Economics and BusinessPresented by: George DemetriadesDate: November 16th, 2016

Do or Die

-3-

Be a victim ? Top 10 Brands That Failed.mp4

Or A Winner? Top 10 Products That Killed Competitors.mp4

Do or Die

-4-

What is the Magic Word ??

… is it magic ??

-5-

The “T” word …..

-6-

…. t ransformation

In industry after industry, scenarios that once appeared improbable are becoming all too real, prompting boards and CEOs of flagging (or perhaps merely drifting) businesses to embrace the T-word: transformation.McKinsey Quarterly, http://www.mckinsey.com/business-functions/mckinsey-recovery-and-transformation-services/our-insights/transformation-with-a-capital-t (McKinsey & Company , 2016)

Transformations as we define them take up a surprisingly large share of a leadership’s and an organization’s time and attention. McKinsey Quarterly, http://www.mckinsey.com/business-functions/mckinsey-recovery-and-transformation-services/our-insights/transformation-with-a-capital-t (McKinsey & Company , 2016)

Why ??

-7-

..transformations need …

Vision

Strategy

-8-

..what is strategy ??

A company can outperform rivals only if it can establish a difference that it can preserve.

What is Strategy ?

a plan of actions designed to achieve a long-term or overall aim.

Why do businesses need strategy ?

-9-

..or a different outlook on strategy components..

 The art of war, then, is governed by five constant factors, to be taken into account in one's deliberations, when seeking to determine the conditions obtaining in the field. 

These are: (1) The Moral Law; (2) Heaven; (3) Earth; (4) The Commander; (5) Method and discipline. The Art of War, Sun Tzu

• The Moral Law causes the people to be in complete accord with their ruler, so that they will follow him regardless of their lives, undismayed by any danger. (Loyalty??)

• Heaven signifies night and day, cold and heat, times and seasons. (External conditions ?) • Earth comprises distances, great and small; danger and security; open ground and narrow passes; the

chances of life and death. (Risk Appetite ?) • The Commander stands for the virtues of wisdom, sincerely, benevolence, courage and

strictness. (Leadership ?)• By method and discipline are to be understood the marshaling of the army in its proper subdivisions, the

graduations of rank among the officers, the maintenance of roads by which supplies may reach the army, and the control of military expenditure. (management & methodology)

Parallelism ..

-10-

……strategy building blocks

1.Drivers & constraints (environment, SWOT, implications)

2.Current state : Where are we ? 3.Target State : Where do we aim to go ?4.Initiatives : tactical targets that give us the

strategy5.Roadmap : How we achieve the tactical

wins ?

-11-

…digital strategy is like any other strategy

…only focused to digital & innovation…

Why Digital

“Digital disruption is changing business.. The rise of smartphones and the mobile web has helped organizations reach customers and segments they never thought possible…”The digital tipping point, A Verint white paper, www.verint.com

-12-

…compiling the digital strategy : step 1

1. Define the Business Objectives RevenuesServicesCustomer ExperienceIndustry specific targets (e.g. Destination Marketing)Other

-13-

…compiling the digital strategy : step 2

Create the customer experience map and identify the “pain points”

-14-

…compiling the digital strategy : step 3

List the external drivers & their effect as well as threats and opportunities by the use of methodologies

 Factors for consideration Impact on Business

Political1. Political issues2. Rise of extreme political powers

1. Tourism may get affected as foreigners may prefer more stable destinations

Economic1. GDP significant decrease2. Salary freeze (or decrease)

1. Decrease of citizens’ disposable income forces changes in consumer behavior.

Sociological1. Unemployment etc. ……

Technological1. Innovation2. Digital disruption

……

Legal1. New legal frameworks …….

Environmental

1. “Green effect” etc. ……

-15-

…compiling the digital strategy : step 3

List the Opportunities to Innovate and the respective Digital Implications.. These are the tactical wins…

-16-

….what do we do next ?

We establish where we are in terms of digital

Digital Maturity AssessmentDigital Value chain & Business CapabilitiesDigital Technology EnablersDigital Enterprise Operating Model

Level of Readiness

-17-

….what is Digital Maturity Assessment?

1. Digital culture and vision – business-IT alignment on the desired target state of doing business the digital way; the organization’s appetite for digital innovation; supporting behavior at all levels of the organization. (Digital leadership and management.)

2. Digital value chain and business capabilities – What the enterprise value chain is now and what they want their value chain to be; their current ability to leverage digital within the business and their vision of what those capabilities should be. (Digital technology.)

3. Digital technology enablers – information technology solutions that enable digital business capabilities to realize the digital vision. Insights/information – applications – infrastructure (devices, platforms, connectivity, security). (Digital technology.)

4. Digital enterprise operating model – cohesive business-IT operating model that enables the organization to effectively innovate, plan, buy/build/integrate, and provision/operate in the digital space. Top priority capabilities: (Digital leadership and management.)

Enterprise operating model management – the operating model must be continuously reevaluated. Innovation management. Digital enterprise architecture governance and management. Sourcing strategy and governance – emphasis on governed, strategic, cloud-based sourcing of

technology solutions that swiftly enable digital capabilities. Digital value realization management – track and promote value. Security and privacy management.

The evaluation of the following metrics :

Assess level of maturity for digital culture and vision

None. The enterprise has no interest in pursuing digital opportunities.

Ad hoc. There is a fragmented, incomplete vision of what the enterprise wants to digitize. There is no shared, holistic business-IT understanding of the target state of digital in the context of the enterprise. There is no culture of digital innovation.

Managed. There’s a mandate (can be informal) from the executive management to explore digital opportunities. Cross-functional, business-technology teams work on digital initiatives that are managed as projects. There’s a culture of business-technology collaboration in adopting the digital way of doing things.

Formalized. A digital strategy is formally defined, approved, and being executed. Shared values and principles for adopting digital are formally defined and promoted to the employees company-wide.

Measured. The company measures the executions of its digital strategy because of the principles that were defined and employees are assessed on their adherence to those principles.

Improving. The company is continually re-evaluating its digital strategy in hope of finding new ways of using technology.

1

0

2

3

5

4

Assess level of maturity for digital value chain and business capabilities

None. The organization has no digitization to its value chain and business capabilities.

Ad hoc. The organization has scattered digitization that was the result of reactive and scattered measures from different silos.

Managed. There is a mandate from executive management to explore digitization of the value chain and other business capabilities. Cross-functional teams execute this mandate.

Formalized. Value chain and business capabilities’ digitization are formally defined, approved, and being executed.

Measured. Value chain and business capabilities have been digitized long enough to provide before and after results on the business.

Improving. The company is continually re-evaluating its value chain and capabilities to see where new digitization methods can be implemented.

1

0

2

3

5

4

Assess level of maturity for digital enterprise operating model

None. The organization has no resources that enable it to innovate, plan, or buy/build/integrate in the digital space.

Ad hoc. The business has an operating model that allows it to innovate, plan, and integrate in the digital space, but there is no guideline on how these processes are done.

Managed. The enterprise has an operating model that has informal guidelines for innovation, planning, and integration in the digital space.

Formalized. The organization has an operating model that adheres to specific documented guidelines that allow it to innovate, plan, and integrate in the digital space.

Measured. The business has an operating model that adheres to specific documented guidelines and consistently adheres to its principles when innovating, planning, and integrating in the digital space.

Improving. The business continuously upgrades the guidelines of its operating model to meet future business needs in the digital space.

1

0

2

3

5

4

Understand scope of technology enablersFirst, define the scope of your digital technology and keep that in mind as you assess the maturity of your digital technology enablers. Please check off all those that your organization uses:Technology Enabler Definition

Analytics Analytics involves a spectrum of data utilization – from data collection, to synthesis, to use in advanced decision-making models.

Mobile Mobile involves the usage of short message service, multimedia message service, apps, and email to communicate your value proposition to the client about your product or service.

Social Media Social media involves a variety of web-based platforms, applications, and technologies that enable your customers to socially interact with your organization and provide user-generated content.

Internet of Things (IoT) Internet of Things refers to an ever-growing network of physical objects that feature an IP address for internet connectivity and the communication that occurs between these objects and other internet-enabled devices and systems.

E-commerce A type of business model, or segment of a larger business model, that enables a firm or individual to conduct business over an electronic network, typically the Internet.

Security Techniques for ensuring that data stored in a computer cannot be read or compromised by any individual without authorization. These measures may involve both the physical and digital world.

Compliance Regulations and rules set by a governing body with regards to the collection and storage of data generated by the digitization of data.

Cloud Computing A type of computing that relies on sharing computing resources rather than having local servers or personal devices to handle applications. Different computing services are delivered to an organization’s computers and devices through the Internet.

Assess the level of maturity for technology enablers

None. The organization has no resources to enable digital business capabilities to realize the digital vision.

Ad hoc. The business possesses technology enablers but innovation and spending are done on an as-need basis with no prior planning.

Managed. The enterprise has informal processes that guide spending on technology enablers but most decisions are still made on a reactionary basis.

Formalized. There is a mandate from business leadership to guide spending on technology enablers.

Measured. The business adheres to specific documented procedures to improve technology enablers and consistently adheres to its principles when improving existing technology intensity.

Improving. The business adheres to specific procedures and also has a formalized plan in place to improve technology enablers for the future based on synergies with current enablers.

1

0

2

3

5

4

Select the maturity level based on the average level of where all your existing technology enablers are at:

Apply a level of readiness assessment to each pillar

Percentage of Completion Description

Not Achieved (0 – 15 %) (N) No or very little progress has been achieved on the current stage of the process.

Partly Achieved (16% – 50%) (P) There is some evidence of an approach to and of achievement in the current stage of the process.

Largely Achieved (51% – 85%) (L) There is evidence of a systematic approach to and significant achievement in the current stage of the process.

Fully Achieved (86% – 100%) (F) There is evidence of a complete systematic approach to and full achievement of the current stage of the process.

A level in the process is achieved if the following occurs: • The previous level in the process is fully implemented.• The current level that is trying to be achieved in the process is largely implemented or

fully implemented.

Apply a percentage of completion to each of your selected levels of maturity on the four pillars to communicate how far your organization is from moving to the next level:

Complete the digital maturity summary

None Ad Hoc Managed Formalized Measured Improving

Percentage Readiness N L P F N L P F N L P F N L P F N L P F N L P F

Digital Culture and VisionDigital Value Chain and Business CapabilitiesDigital Technology EnablerDigital Enterprise Operating ModelSummary: (A short summary and overall level of the organization’s digital maturity.)

*See the next slide for a filled out digital maturity summary.

Sample: Digital maturity summary None Ad Hoc Managed Formalized Measured Improving

Percentage Readiness N L P F N L P F N L P F N L P F N L P F N L P F

Digital Culture and VisionDigital Value Chain and Business CapabilitiesDigital Technology EnablerDigital Enterprise Operating ModelSummary: Managed. Business leadership has an informal mandate to explore digital opportunities, the digital value chain, and business capabilities. The organization also has informal guidelines from management on how to innovate, buy, and integrate digital processes. These 3 pillars are close to begin formalizing into actual documented processes. Digital technology exists in the organization but is only improved on an as-needed basis. Improvements still need to be made to have informal processes to guide spending on technology enablers.

-26-

….and…?

We establish where we want to go

Using the 10 “commandments”Creating the fundamental objectives

Creating the target customer experience mapEstablishing the target maturity model

Defining the roadmap

-27-

…the ten commandments of digital…

Digital Guiding Principle Name Digital Guiding Principle Statement

1. Customer engagement We will seek to create new meaningful digital interactions to increase the customer’s level of engagement and satisfaction.

2. Value generation We will only undertake digital transformation in order to generate value for the customers and for the organization.

3. Competitive landscape We will examine our competitive environment, to determine whether we are losing consumers to new technology, and remain flexible to adapt to these changes.

4. Reuse > buy > build We maximize reuse of existing assets. If we can’t reuse, we rent or procure externally. As a last resort, we build custom solutions.

5. Simplicity We choose the simplest solutions and aim to reduce operational complexity of the enterprise.

6. Iterative approach We will implement digital initiatives, collect feedback, and iterate to increase collaboration and the likelihood of success.

7. Managed security We manage security enterprise-wide in compliance with our security governance policy.

8. Compliance to laws and regulations We operate in compliance with all applicable laws and regulations.

9. Innovation We seek innovative ways to utilize technology for business advantage.

10. Collaborative We seek to involve the organization as a whole to engage in digital transformation.

Support our Business partners Growth-

Innovation / test & learn-

Boost Digital presence-

Digitalization of traveller’s journey -

Strategic Partnerships

Maximize travelers’ value through sales-

……our fundamental objectives

-29-

Stages 1 2 3 4 5

Attitudes Interested Educated Happy Delighted Satisfied

Behavior line Initial contact Research Purchase Delivery Post-purchase

People and things

Call center employee, on

site, and website

Web research/website

In store, over the phone, or website

Third-party delivery

Call center, self-serve portal, and

mobile app

Background support

Telephone, staff, and website

Search engine optimization and

company site

Staff and company website

Call Centre / Social Media

Centre

Call center analytics,

website, and app

……..creating the target customer experience map

Desired Improvements

Target Digital Maturity

None Ad Hoc Managed Formalized Measured Improving

Percentage Readiness N L P F N L P F N L P F N L P F N L P F N L P F

Digital Culture and Vision

Digital Value Chain and Business Capabilities

Digital Technology Enablers

Digital Enterprise Operating Model

Definitions: Not Achieved (0 – 15 %) (N); Partly Achieved (16% – 50%) (P); Largely Achieved (51% – 85%) (L); Fully Achieved (86% – 100%) (F)

-31-

….define the roadmap…………..…

Stakeholders to agree on roadmap of projects & assign resources

Finalize initiatives for each strategic pillar

Stakeholders to define roadmap’s Benefits and KPIs

Gain executive sponsorship & involvement

The way forward…

-33-

The digital way of doing business encompasses an innovative use of modern technologies that continuously transforms the business to gain competitive advantage and improve value realization. A successful customer-focused digital transformation will improve how your customers perceive your organization, and will open the doors for new opportunities, business models, or even industries.

Alexander ZverintsevCIO Advisory

Info-Tech Research Group

Don’t be relegated to a supporting role – be a partner in determining how to create a better customer experience through

digital transformation.

ANALYST PERSPECTIVE

-34-

Force update

Sales Forecast

Adjust pricing

Profit Oprimization

Push item xx more

Recommendation Engine

Optimize Inventory across

warehouses

Supply Chain

Updated to cater for increased

demand

Inventory Forecast

Popularity of item xx increases

Sales Forecasting

… a chain reaction…. Guess what ….

Teaser !!!!

-35-

1. Supply chain optimization (warehouse selection)2. Supply chain optimization (II) (Routing)3. Supply chain optimization (III). (Gas purchase optimization)4. Supply chain optimization (IV). (Road Traffic Analyzer) 5. Pricing and profit optimization 6. Fraud detection 7. Fake reviews detection.8. Taxonomy creation  9. Smart search engine technology 10. Multivariate testing, for instance to find out which version of a search engine increases sales, everything else being constant11. Recommendation engine 12. Customer segmentation13. Advertising optimization (SEO & SEM)14. Inventory forecasting 15. Sales forecasting  16. HR analytics: 17. Real estate analytics18. Software/hardware system analytics19. Payments analytics. 20. Competitive analysis21. Tax engineering Ad Relevancy Algorithm (Optional)

..tomorrow is already today… Integrated Strategy Machine …

Optimum commercial Results

BCG, The Integrated Strategy Machine, https://www.bcgperspectives.com/content/articles/strategy-technology-digital-integrated-strategy-machine-using-ai-create-advantage/

-36-

Thank you

George.Demetriades@AIA.GR