Welcome to the world of digital transformation.

You know better than anyone how to run your business. You know what works, how it works, and, above all, you’ve had your way of doing things for a long time. You have a plan, a budget, a team, and things just work. It’s a comfort zone.

But as Mike Tyson would say:

"Everyone has a plan until they get punched in the face".

That punch can come from several directions and take several forms: disruption from new entrants with better business models, better products, and smarter technology. That’s when companies start asking where they need to improve, change, and adapt. Most of the time, the answer is a lack of digital efficiency and an inability to adapt to more modern technologies.

So, what is digitalization? What does it really mean, and how can companies win the digital race? In a nutshell, digitalization is the process of updating your business processes, culture, and customer experience using modern digital technologies to become more efficient. Most digital giants and early adopters have understood this, while only a few companies are truly benefiting from it.

Think end-to-end digitalization

Digital giants make a lot of money from digital technology. Think of Amazon, Google, Apple, and Facebook, whose revenues run into the billions. Critics may say they make money through unethical and illegal behavior. But they understood one thing: value creation.

Most large companies are engaged in digital transformation, but few seem to be on the right track to becoming fully efficient and profitable. The reason is that they focus mainly on the transformation part of digitalization and don’t streamline the end-to-end touchpoints of digitalization. Put simply, digital transformation can be broken down into 3 phases:  

1. Buy
2. Transform
3. Sell

In the "Buy" phase, buyers purchase and data value is created for full visibility and decision-making. In the second, "Transform" phase, companies devote much of their work and investment here — integrating HR tools for organizational efficiency and financial tools. While this helps the business run more smoothly and communicate better, it simply isn’t enough.

Many companies have all the tools they need to be efficient and understand their data, but they still fail to sell their services and products.

Why? Because the third "Sell" phase of digitalization is pushed to the background, or even ignored in some cases. B2B companies are reluctant to change or launch B2B eCommerce for several reasons, the most notable of which are the following:

- Misconceptions about the B2B buyer - There’s a myth that most B2B buyers don’t want to buy online. In the past, strong customer relationships were built on personal relationships. With the web and new technologies, industrial-era companies think this will eliminate human interaction. On the contrary, it brings companies closer to their customers through the right tools and processes, making interactions easier and customer experiences better.

- A lack of simple, native B2B solutions on the market - The solutions currently on the market are built on the B2C model, and many of the major platforms are on-premises, which means companies have to keep up with every new release and pay for them.

The need for agility, adaptability, and scalability in a constantly changing market becomes difficult with these solutions, because they aren’t designed or built for B2B needs.

Managing multiple vendors on the platform, complex bulk orders, individualized pricing, content duplication across the platform, automatic ERP system reading, and the long purchasing process involving multiple decision-makers are just a few of the many B2B requirements we face today.

- Digitalization decisions made by middle management - in many companies, large or small, digitalization gets stuck at middle management level. The digitalization project and process have become siloed instead of being a company-wide effort across every level and department. The goal of digitalization isn’t just to implement faster IT or sales tools, but to reinvent the organization as a whole.  

The existing challenges are complex and difficult to tackle, which makes it even more important to approach digitalization as value creation across every channel, from buy to sell.

People don’t buy an Apple phone because it’s a good product; they buy it because it’s easy to use and adds value to many needs in people’s lives.

Better ways to create value

Part of the digitalization jungle is that most companies focus on extracting value and less on creating value. They focus more on internal processes than on creating value for customers. If these companies keep going down this path, it’s only a matter of time before most of them fall behind digitalization pioneers. According to a recent McKinsey study, "82% of B2B decision-makers will actively look for a new supplier if a performance guarantee isn’t offered in the omnichannel experience." (HBR 2022).

Think customer and self-service

Successful B2C brands understand their consumers and buyers. They understand that times have changed and that consumers want to be able to buy, experience, or communicate anytime, anywhere, and everywhere.

The way B2B customers buy is changing, mainly because of the millennial generation (Forrester 2020). Tech-savvy buyers expect nothing less than a full e-commerce experience. They don’t want to be limited in their device choice or payment options when making a purchase.

With the convenience of self-service in our personal lives, there’s growing pressure for B2B to offer the same convenience and simplicity when ordering products or services.

Assess your channels

The number of B2B customers who prefer to deal with a sales rep in person or by phone, fax, or even email will continue to decline rapidly as millennial buyers gain more decision-making and purchasing power within their companies.

Just as Uber reinvented the taxi industry and Netflix changed the way we watch movies and TV, companies need to adapt their models to stay relevant or risk being disrupted like Blockbuster. Delivering an integrated experience across channels means evaluating every channel in place — do they work together, or are they siloed? According to Harvard Business Review (2022), leading B2B companies use cutting-edge cloud-based platforms to integrate customer data across channels in real time. Launching isolated websites may work well for acquiring new customers for a while, but it will most likely frustrate existing customers.

The way companies manage all their customers across channels will be defined by their ability to deliver a fully compelling, seamless experience. Every channel will need to be streamlined: whether procurement, sales, acquisition, or customer support. Just like in B2C, B2B buyers now expect to move from one channel to another without complexity.

To deliver a seamless end-to-end B2B experience, companies need to build a complete mix of agile technologies, break down channel silos, and deliver a consistent message across every channel.

No big bang

Digitalization doesn’t have to happen overnight. A rushed digital transformation effort is, in some ways, worse than no attempt at all, which is why reworking the processes at the heart of your business requires serious thought and planning. It’s better to start small than big, especially if this is the first step in digitizing business operations.

Succeeding in B2B commerce is complex, but in reality, it should be easy in 2022. A company-wide commitment to B2B commerce excellence can truly be a game changer. Not only will companies be better positioned to gain a competitive edge, but they’ll also improve decision-making, customer satisfaction, and revenue growth.

Now is the time for companies to take note of how the major giants and early digital players are navigating the digitalization jungle. They do it with agility and intelligence, constantly creating new and innovative ways of doing business, always with a deep and ongoing understanding of customer needs and behavior.

Waking up to reality after a punch can be hard, but necessary, if companies want to survive in this digital jungle.

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