The customer is king: The commercial perspective on digital transformation
Commercial and sales teams have a clear vision for digital transformation, but research suggests that they are also disappointed by what their businesses have achieved so far. What do they need to do and who do they need to partner with to hit those right notes?
While commercial and sales teams have a clear vision for digital transformation, many are not achieving the improvements in the customer experience they had hoped for, and they are also falling behind on other key goals, including efficiency and speed of decision making.
Compared with other functions in the business, commercial teams are significantly more likely to be focusing their digital activity on improving the customer experience. Despite this clarity of purpose, there is a long way for the commercial and sales teams to go to meet their objectives. All too often, they are hitting the wrong notes.
According to new research by DBS, less than one in three commercial respondents (31%) has managed to exceed their customers’ expectations around digital engagement. Around half (48%) admit that they are just catching up.
There is frustration elsewhere too. Scarcely one in two commercial respondents is satisfied with how digital transformation is improving customer acquisition. About the same amount (51%) are pleased with their results on brand awareness. Moreover, only 53% think that transformation is helping them retain customers.
The key that is treasury and finance
How do commercial teams secure more of the transformation benefits they had expected? The DBS findings suggest that building stronger links with their business’s treasury and finance functions will make the difference.
The research indicates that organisations achieving the greatest all-round success from transformation are far more likely to have championed collaboration between commercial functions and treasury and finance – right from the earliest stages of innovation and new product development.
Jean Noel Lau Keng Lun, Senior Vice President Product Management at the French hospitality business Accor, subscribes to this approach. He runs Accor’s ‘Digital Factory’ initiative, which is responsible for driving transformational products across the business with the collaboration and support of multiple business functions.
“Our organisational culture has shifted,” he says. “In the past, we had some tense negotiations between functions, but most of that is gone now. Instead, there is a spirit of partnership, of co-construction, and even of co-conception of the initial idea.”
Many commercial teams have started to recognise this imperative. The top priority of the commercial function as it strives for better transformation outcomes is to improve data-sharing across the business. Asked about the key elements of a more productive collaboration with treasury and finance, 46% say that the teams need to share timely, high-quality data.
For now, 57% of commercial teams worry that a lack of collaboration between their function and treasury and finance is making digital transformation more challenging than it needs to be. What is stopping that collaboration from happening?
The obstacles in the way of closer working
First, there is a resourcing issue. Almost half of commercial teams (45%) in the DBS research are concerned that their colleagues in treasury and finance do not have the bandwidth to support transformation with the commitment that their organisations now require, which will be exacerbated by the demands that the inflationary environment is putting on the function.
Another concern is that finance and treasury appear to have different views about when they should become involved in digital transformation work. Almost a third of commercial teams (31%) want collaboration to begin much earlier. Finance and treasury teams are less likely to feel this way.
Then there is the issue of mismatched priorities. Commercial managers may be focused on the customer-facing benefits of transformation, but finance teams are more likely to see increased efficiency as their most important objective. With different goals, the two teams may struggle to work together effectively.
Leading on from this, commercial teams will naturally measure success in a different way to their peers in treasury and finance. More than a third of the commercial teams in the research (35%) see this as an issue standing in the way of closer collaboration.
Stepping out of siloed comfort zones
To address these problems, different parts of the business will need to learn each other’s language.
“You need to be really clear about the strategy around what you are trying to build, and you need to help finance understand that strategy,” says Mike Hughes, Head of End-to-End Digital Commercial Excellence at energy company Schneider Electric. “Finance naturally wants to feel comfortable that there is a strategic plan underpinning investment and that this plan will drive measurable returns, so you need to help them get that comfort.”
The bottom line for commercial teams is that collaboration requires a different type of mindset. In DBS’s research, the most successful transformers are the businesses that are empowering their commercial, finance and treasury leaders to step out of their comfort zones and take greater responsibility for driving change.
Commercial teams that can embrace that opportunity will, alongside finance and treasury, finally secure the benefits promised by transformation.