Any business can be a digital business

green washing machinesDigital innovation and disruption can happen anywhere and at any time. It is one of the features of the digital revolution, which is using technologies that are freely available and at relatively low (and sometimes no) cost to create new offerings and experiences for customers. And due to the ubiquitous nature of these technologies, the disruption can come from previously unknown or small players within the market or from start-ups with no prior presence in the industry they are disrupting.

Digital requires a new perspective on the organisation. It is about looking at the business from the customer’s perspective. It is about understanding what outcomes or benefits the business provides for the customer, and asking what additional or new outcomes or benefits it could provide in the future.

And any business can do this. Whether your organisation is large or small, consumer- or business-facing, online or completely offline, it is possible to take this outside-in approach to develop a business model, products and services that will ensure your business can survive in the digital age.

Take for instance a launderette. A traditional, bricks and mortar business with little or no online presence other than perhaps a website or a listing on some business directories. How does this type of business become a digital business? Well, one launderette owner in Brisbane, Australia has done just that. Ian McFarlane, owner of Snap Laundromat, has internet-enabled the washing machines and dryers, enabling customers to pay for services with their smartphones.

To use the service, customers first create an account with Eziwash, the business McFarlane has created to provide the service to his own and ultimately other launderette businesses. They can then use the mobile app to add credit to their account, check their account balance and pay for using a machine by selecting its unique code and the service they wish to use.

McFarlane developed the solution by first identifying a customer need or outcome and then by working out how technology could be applied to meet that outcome. In this case the customer need was to not have to collect and carry large amounts of coins to operate the machines. By combining freely available technologies such as a controller within the machines, a cloud-based server, a mobile app and a payment gateway Eziwash has created a digital service that gives customers an added benefit and enhances their experience of using the launderette.

But the potential of this solution does not stop at facilitating cashless payments. Because the solution will collect data on customer purchases, Eziwash plans to establish a loyalty scheme that rewards customers that use the mobile app for being regular customers. This extension of a solution to provide an additional customer benefit is what James McQuivey refers to as adjacent possibilities in his book, Digital Disruption: Unleashing the next wave of digital disruption. Looking at adjacent possibilities is way of generating ideas for innovation that are driven by customer needs as opposed to the more traditional route of looking at the organisation’s existing products or services and thinking about how they can be developed, enhanced or even replaced.

Adjacent possibilities are generated by asking a question such as what is the next thing my customer wants? And, as McQuivey explains, by asking this question repeatedly it is possible to generate a large number of ideas for potential innovation. However, some of these ideas may not yet be feasible so the next step is to look for convergent possibilities. In other words, look for those ideas that can be realised using available solutions (and not necessarily technology solutions) inside and outside your company. In the Eziwash example, cashless payments would not have been possible 5 years ago but the availability of the smartphone, cloud and payment gateways converged to make the idea possible.

McQuivey also suggests a third step: persist in the path of innovation, which means continuing to innovate the adjacent possibilities, as this will lead you to “the next thing your customer needs, even if that thing is not exactly the product you originally designed.”

The Eziwash loyalty programme is an adjacent possibility that is enabled by the original solution and the customer data that is collected by the app. These two things converge to make the loyalty programme the next innovation that enhances the customer experience.

And, if Eziwash continues to innovate based on adjacent possibilities it is easy to see how the launderette’s mobile app could be extended to send alerts to the customer when their wash cycle is about to end, or through a partnership with content partners the customer could be offered access to TV programmes, films, music, online magazines, etc, through their smartphone. The app could even recommend certain types of content to match the length of the selected wash cycle.

In the future, if clothes carried QR codes on their wash labels, the app could be used to scan the code and recommend a wash cycle (or set it automatically), or if clothes carried RFID tags the app could read the recommended washing instructions of all items and determine the optimum cycle for the load. And the information from QR codes or RFID tags could be used to serve adverts and special offers for clothes from the same brand, or similar products from other brands. The customer could browse and purchase these products while they are waiting for their wash cycle to finish.

Taking the outside-in approach based on customer needs and adjacent possibilities can quickly turn a traditional, bricks and mortar business such as a launderette into a digital business with a range of digital products and services that enhance the customer experience, improve retention, and create value and potential for the organisation far beyond the base transaction of paying for the use of a washing machine.

And if digital can do this for a launderette then what can it do for your business?

If your organisation wants to develop a strategy for becoming a digital business or if it wants to generate a pipeline of ideas for digital innovation within its products and services then please contact me or visit my website, axin.co.uk.

Trackbacks

  1. […] a previous post, Any business can be a digital business, I discussed how a launderette had added digital services to its core product to enhance the […]

  2. […] digital age or do they just need to develop a network of partners that understand these areas? In Any business can be a digital business I described how a laundrette had internet-enabled its washing machines and dryers, enabling […]

  3. […] them disrupting their own markets if their competitors cannot keep up with the pace of change. (See Any business can be a digital business for more information on the adjacent possibilities approach to […]

  4. […] Any business can be a digital business I described how a launderette in Australia had added digital services to its core product to meet […]

  5. […] over a year ago I wrote about a launderette that had created a digital experience for its customers by internet-enabling its washing machines […]

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