10
Dec

Era “CoMoDIn”

Excelling at Customer Service, increasing revenues, reducing costs and Sustainability remain as companies’ main open challenges. This article introduces a framework (“Co-Mo-DIn”) to ease their understanding and how to face them. Let’s analyze separately each of the components:

  • Co, includes the collaborative dimension, commitment towards establishing alliances and opting for a co-petitive approach (Collaborate & Compete) beyond just a competitive one. Companies need to interact with each other, understand consumers’ changing habits and how these affect their activity and the environment where they perform. In this context it is worth mentioning the concept of co-creation. According to a study from the WTO, co-creation of economic and social value, involving the key stakeholders of the ecosystem (customers, providers, ambassadors) has led to significant productivity increase and improvement of customers’ perceived value, particularly within Service companies.
  • Mo, refers to the quantitative dimension, comprising monitorization and monetization of the company’s information and high value data. A precise and concise definition of Key Performance indicators allows to measure. Rephrasing Lord Kevin “What is measured can be improved; otherwise what is not improved is always degraded”. A Data Monetization strategy untaps the opportunity for short term Profit enhancement through revenue increase or cost reduction. Data monetization must be decoupled from Digital Transformation and companies that are laser-focused on data monetization regardless digital transformation and their state of digitization maturity have been found to gain tremendous benefit and possess significant advantage in the market.
  • D, equals Digital. The cost of computation and storage has decreased dramatically in the last years. The cost per megabyte of data storage in 1956 has fallen from US$85,000 to $0.00002 today in constant dollars. Furthermore, connection speeds of hundreds of megabits per sec now cost only tens of dollars per month [1] [2]. The The result of this, is that organizations installed a myriad of systems – computers and software – to enhance their services, resulting in the capture and storage of enormous amounts of data. Most of it is, in the best of cases, is underutilized [3]. On the positive side, digitalization has enabled the proliferation of advanced techniques for data analytics to process and analyze information, in order to create value. At this stage, OpenSource development has been a key accelerator.
  • In, stands for Innovation. Transformation ocurring at all levels demands companies to un-learn and re-learn; in other words making things different. Innovation is a must for every company that wants to outperform in a sustainable way. Statistics reveal that most innovative companies attain high capitalization market values multiplying by an exponential factor (e.g. Google, Amazon, Facebook, Alipay, …). Other competitors anchored to traditional models lost market share or even ran out of business. Innovation often increases complexity- number of initiatives, stakeholders, data sources, platforms, tools, controls – and with the rise of digital transformation this intrinsically growing trend is not foreseen to slowdown unless companies approach disruptive cultural transformation around simplification, identification and elimination of unnecessary complexity.

The result of putting together the aforementioned components is the immersion of the company in a continuous improvement dynamics that allows to prosper. This framework enriched by a leadership with focus on Governance and the social and environmental dimensions has proven exponential growth rates. In the last decade, investment sustained on this model’s principles has ten-fold up to US $30 trillon. 

Main reasons to consider the CoMoDIn dimensions can be grouped in 4 categories:

  1. Improving Customer Service, favored by co-creation that generally derives in better user perceived value and increases the sense of belongness by core stakeholders.
  2. Revenue generation, as a result of innovating in products and services that add value and thus customers are eager to pay for them.
  3. Cost reduction, as a consequence of increased efficiency from the new ways of working – Agility, collaboration and automation as the key drivers and technology as a facilitator.
  4. Sustainability, in how the business evolves leveraging on a data monetization strategy that untaps short term Profit engancement opportunities and capitalizes on a continuous improvement dynamics that optimizes investment in resources and constant measurement of performance.

As future lines of work, this framework could be enriched with the definition of a Performance Index and a Checklist that supports business leaders and executives along the Process of decisión making.

[1]D. Parkings, “The world’s most valuable resource,” The Economist, May. 2017. 

[2] “Drastic falls in cost are powering another computer revolution, ” The Economist, September. 2019. [Online] Available: https://www.economist.com/technology-quarterly/2019/09/12/drastic-fa lls-in-cost-are-powering-another-computer-revolution 

[3] F. Toesland, “How five brands learned from digital transformation failure,” www.raconteur.net, September. 2018. [Online] Available: https://www.raconteur.net/digital-transformation/digital-transformation -failure

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