The ultimate resilience resource, part two: digital agility

 

Resilience is one of the key business buzzwords to rise from the COVID-19 pandemic, but it has always been essential to survival. Being a resilient business is  about being able to adapt rapidly to changing environments. It’s having resilient systems and processes, which in turn helps the business to continue operating smoothly in the face of a disruptive event.

COVID-19 is an extreme example of a disruptive event, but with everything changing faster and being more interconnected, a much smaller issue could still bring a business undone, whether that is a competitor, a weather event breaking your supply change, a hacked IT system or the sudden departure of key personnel.

In this four-part SmartCompany Plus series, we’ll dive into four key pillars of resilience — adaptability, agility, people and community. We’ll unpack what resilience looks like in these areas, and how they can help your business stand up to the toughest of tests.

Part two is digital agility.

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Agility explained

Many businesses that had long intended to become ‘digitally agile’ before COVID-19 were forced into action when the pandemic hit. In May 2020, McKinsey Digital reported that “we have vaulted five years forward in consumer and business digital adoption in a matter of around eight weeks.” Banks, grocery stores, doctors surgeries, education providers and more all swiftly pivoted to offer nearly 100% online services.

This view is backed up by Cisco’s 2020 Asia Pacific SMB Digital Maturity Study, which found nearly 70% of SMEs in Asia Pacific were accelerating the digitisation of their businesses as a result of COVID-19. 

Digital agility is defined in many ways. Essentially, it is about embracing technology to help deliver products and services to customers in the most efficient and effective ways. Deloitte says this can include external platforms for marketing and communicating with customers, along with cloud software to manage sales, payments, logistics and back office processes.  

This digital-first approach aids a business’ resilience — strengthening its ability to maintain service delivery throughout times of disruption. Deloitte reports that digital agility helps to foster new innovations, improve revenue, open up opportunities to employ more people, and help deliver to changing customer needs — including gaining new customers internationally. 

“…SMBs with higher levels of digital engagement do indeed have a superior business performance to those with lower or more basic engagement with digital tools,” reports Deloitte. 

Agility works hand in hand with adaptability, which we explored in The ultimate resilience resource part one: Adaptability.

Agility in action 

Within the SmartCompany network, many SMEs leapt forward with their digital agility agendas from the onset of COVID-19. Here are some case studies of their experiences. 

Embracing virtual tools

Before COVID-19, KidsCo ran on-site school holiday programs in corporate workplaces to keep children occupied while their guardians were working. The programs were facilitated by school teachers and were designed to be fun, interactive and educational.

In March 2020, KidsCo received a flood of calls cancelling bookings. COVID-19 had hit Australia, and people would be working from home. Co-owner Adrian Rokman says that after coming to terms with the new reality, the team quickly got to work getting digitally agile. They innovated with KidsCo Virtual – a series of online, full-day programs that kids can do from home. The next step was to market the new program via direct email to existing clients.

“We sent an email out to our database with the subject line ‘KidsCo’s got your back’ with an explanation of the initiative and a ‘book a 15-minute meeting’ link. The following morning, we opened our calendar to find 47 meetings booked,” says Rokman. 

With the initiative proving a success, the team went on to create ‘Virtual After School Care’ — a mini version of the full day offering. 

By becoming digitally agile, the business is now able to scale its services, and also expand internationally.  

“Whilst international expansion was always on the cards, it wasn’t a focus until 2022… In April-May (2020) we expanded to New Zealand, Singapore and Hong Kong. In July, we expanded to the UK, Wales and Ireland. In September, we expanded to Japan. We are now looking at launching into the US.”

 

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The steps we took were:
1. Brainstorm
2. Contact clients to understand what they need (market research)
3A. Divide and conquer across technology, procurement, staff and sales strategy
3B. We all came back together at 6pm to discuss our findings and create a plan of attack
4. Launch
Adrian Rokman, KidsCo

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Leveraging ecommerce and digital marketing

East Forged launched in early 2020 and produces a non-alcoholic, cold-brewed tea, packaged in a can. Co-owners Kym Cooper and Tania Stacey had planned to educate buyers about their beverages in person at restaurants, bars and cafes, as well as at markets, trade shows and tasting events.

However, with the onset of COVID-19, it was clear they would need a digital approach to reach their customers. E-commerce was central to the new strategy, so the pair enlisted the support of two digital marketing specialists to boost public relations, data, SEO and online advertising. 

“By August we had grown our digital channels through Amazon Launchpad and Dan Murphy’s online, allowing us to reach a wider demographic of customers, and to provide data on market segment and category fit of our digital customer profiles,” says Cooper.

To meet delivery demand, East Forged shifted from a single third-party logistics solution to state based fulfilment warehouses, to ensure the ‘last mile’ of shipping was much more efficient. To entice new customers, they created smaller pack sizes so that people can try the drink flavours before committing to large orders. 

“Overcoming a cost barrier and providing greater choice helped to continue getting our beverages tasted by prospective customers when tasting opportunities were no longer available,” says Cooper.

The pair also embraced social media, updated their website and engaged with influencers to help spread the word about their products and brand story.

“We were also very careful to select influencers that genuinely enjoyed our beverages. This has helped with building awareness in our customers’ journey, and we are starting to see the result of these low-cost marketing campaigns with increased online sales and also wholesale enquiries.”

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“We have learnt that being a direct-to-consumer brand gives you the closest connection to your customer, allowing us to gain detailed insights for data collection and CX optimisation. We now have dashboards in place that show us the impact of our marketing efforts across social media, Google and other referral sources and this allows us to direct our marketing budget more wisely.” Kym Cooper, East Forged

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Streamlining shipping

Melbourne-based fitness goods retailer World Fitness Australia had one eye on retail expansion, but when COVID-19 hit, the team turned attention to e-commerce instead. They made adjustments to the website to create an ‘in-store experience’ online, with better visuals and communication opportunities. Next, they engaged in more online advertising, and soon found Google and social media ads were driving 70% of sales. 

Co-owner Fred Seoud says that as e-commerce ramped up, the team had to streamline product dispatch and improve the accuracy of their inventory data. 

“We had no control over delivery times, but we did have control over how quickly we could dispatch orders,” he says. 

E-commerce has expanded the business’s national audience, which in turn is refreshing the team’s interest in opening physical stores in different states. In addition, World Fitness Australia is looking to provide more online value to customers. 

“Some of these strategies include sharing complimentary workout videos across all social media channels for anyone to access, and sharing regular health and fitness tips,” says Seoud.

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“Don’t be afraid to experiment with something. The point is you won’t be any different to any other business if you continue to emulate, not innovate. Once your plans are playing out in the real world, you need to adapt quickly to reactions, assess if you need to change something, and then don’t wait, change it ASAP!” Fred Seoud, World Fitness Australia

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The solutions

Putting digital agility into practice

Being a digitally agile business means embracing digital tools. As mentioned earlier, Deloitte reports that these include external platforms and marketplaces to use for marketing and communicating with customers, in addition to cloud software to manage sales, payments, logistics and back office processes. 

Deloitte defines an ‘advanced’ digitally agile SME as one that has a website that allows for domestic and international sales, conducts the majority of its sales online, uses data insights to market and personalise products, uses marketing tools such as SEO, and uses cloud-based software across business functions.

Here are some thought starters in these areas:

Three avenues for digital agility

1. E-commerce

   Customers will increasingly engage with your business across multiple platforms, which means you need to offer an ‘omni-channel’ experience. This means customers can shop in-store, online, on their phone, via social media, choose to click and collect, and more. It also needs to be supported by streamlined logistics to make sure your customers get their goods quickly and securely. Shopify outlines some good tips for logistics, covering everything from planning your shipping costs, to considering product weights and having suitable packaging. 

2. Data driven personalisation and advertising

   Analysing customer data is central to being responsive to your customers’ needs. David Evans, a director in data science at KPMG, says the key is: “Collecting and mining raw POS (point of sale) data to understand what motivates your customers to remain loyal, so that you can provide the right incentives to maintain or improve your relationship with them.”

   This insight helps you choose the products, channels and messaging that you use to reach customers effectively. 

3. Cloud platforms

   Countless cloud software vendors have tools for e-commerce, data and analytics, customer relationship management, managing advertising and social media output. These are increasingly able to be integrated into your existing software rather than having to fully replace systems. 

Keeping ahead of customers

According to McKinsey Digital, businesses that have invested in becoming digitally agile during the COVID-19 pandemic will be in a better position than their competitors when it subsides — as consumers will largely stick with their new digital habits. 

“Fully 75% of people using digital channels for the first time indicate that they will continue to use them when things return to ‘normal’,” McKinsey Digital reports.

For SMEs still on the digital starting block, there’s no better time to become digitally agile with so many platforms and software tools available to make the process more simple.

Digital agility will not just benefit your business’s resilience in the face of the next disruption, but will keep your customers happy and give you a competitive edge.

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Three further readings on resilience and digital agility  

1. This McKinsey & Company compilation explores digital agility issues such as cloud platforms, digital analytics and cybersecurity. One piece points to a world in which: “digital channels become the primary (and, in some cases, sole) customer-engagement model, and automated processes become a primary driver of productivity — and the basis of flexible, transparent, and stable supply chains.” 

2. The Australian Retail Outlook 2020 compiles a raft of expert thoughts on digital agility in the e-commerce space, covering everything from the customer experience, advanced analytics, inventory management and more. 

3. For a quick guide to building an e-commerce arm to your business, Shopify has compiled some of its top tips from sourcing products to understanding SEO and fostering sales channels. 

Look out for part 3 in our resilience series – a deep dive into People.