Through the road of transformation of Suning and L’Oreal, how can enterprises improve their digitization capabilities?
At the CDIE Expo (China Digital Inovation Expo) & CIO Summit Tiger Yang, Co-Founder and President of APEX Technologies, hosted a roundtable on how to solve the contradiction between the growing digital demand and the current backwards business model with Junjie Wang, Director of IT Applications of L’Oreal China, and Junjie Wang, Dean of Technological Research Institute of Suning Group, as panelists.
The digital transformation has brought about a new angle on how businesses approach customer experience, which has changed the way enterprises compete with one another. Technology has become the cornerstone of enterprise competition and has become an essential component of corporate strategy.
Using technology as a stepping stone to manage the customer life cycle is the best way to quickly build customer loyalty. The so-called technological empowerment entails breaking the ancient pattern of marketing, products, technology and customer data which are omnipresent in most business models. Based on customer needs and scenario applications, and supported by big data, APEX Technologies will establish an adaptive digital business model. In other words, the digital transformation of the enterprise is based on all the support that IT technology provides through seamless integration. This will make sure that business and technology can truly interact with one another and drive value for both the enterprise and the consumer.
Digital transformation is the top-down transformation of the enterprise
Digital transformation is not a simple IT system upgrade, but a process of IT upgrades and business model innovation.
Junjie Wang, dean of the Suning Group Technological Research Institute, said that the digital transformation of enterprises involves a systematic transformation and innovation of corporate strategy, organization, operation, and talents. Enterprises are required to fully understand and implement innovations from top to bottom. Suning has 11,000 IT employees to facilitate digital transformation, but it operates quite differently from other enterprises with regards to development, operation and maintenance, testing, and product structure. It has an IT organization structure with both orders, customers and data in the middle. They use their system to focus on the core of the organization, as opposed to just mobilizing the digital process of each department and thereby driving value to the business.
The application of new technologies should be based on the actual business pain points of the enterprise
Whether new technology creates customer growth or so-called channel innovation, all efforts must increase the turnover of the retail scene and ultimately lead to an increase in the company’s business.
In 2017, L’Oreal’s IT department made an attempt to use machine learning to analyze the sales in their stores, but the actual results were not good, which inevitably lead to doubts about the technology. Why are such forward-looking technologies and thinking not producing value? The reason is that the data does not give the customer a better experience because it does not solve the real business pain points. Technology serves the business, and business supports technological applications with data. The two should complement each other rather than be separated.
At the meeting, Tiger Yang, President of APEX Technologies, put forth a question that is very meaningful for digital transformation: “How can companies coordinate the technological investment to meet short-term business needs and explore future business development?”.
Junjie Wang believes in the process of small steps in upgrading an enterprise’s technology base. It is necessary to upgrade technologies at each stage in a business and make a long-term investment and commitment to facilitate a sustainable and profitable environment for future business growth. Enterprises must start pursuing sustainable development. There is no substitute for short-term and long-term. The key issue is how to deploy correctly at the right time. This will test the familiarity of technicians with the business, and how to create application scenarios according to local conditions to create greater value for the business.
New technologies need to create sustainable value for business development
One of the typical characteristics of digitization is that there will be unexpected changes in the development curve. It means that companies can’t only rely on past experiences, but must use the science of data technology to see the future.
After analyzing the data, Suning found that although most customers who buy latex pillows are elderly people, there’s also quite some potential in the infant market. Based on this insight, Suning developed a baby latex pillow to create a vital future business.
CDIE Roundtable Forum
Tiger Yang said that the digital era has broken the traditional business boundaries and replaced them with a common language system, constantly flowing data, and the infinite possibilities of continuous iterative upgrades. In the future, industry competition will still entail market share competition and customer acquisition, but it is actually a battle for data based customer experience improvement. Enterprises need to establish a sense of digital management, establish a digital management capability, build a data application tool to mine the huge value behind the data, and ultimately move towards sustainable development.
Today, leading companies are fundamentally rethinking how to provide customers with more comprehensive services and evolve their technology solutions. They transform the IT department into an engine that drives business development, serving the back-end systems, operations, and even products and platforms. Through this kind of transformation thinking, digital demand and the business model can form a good transformation loop, so that technological innovation can be applied to specific business scenarios and realize value for both the customer and the business.
From cloud computing to artificial intelligence, the marketing revolution brought about by the technological revolution is taking place. After experiencing the early stage development, new technologies are gradually sinking into more and more industries, thus promoting the “digital transformation” of traditional enterprises. At the same time, having the ability to analyze data will be seen as a wind vane for a company’s ability to take advantage of future technological developments.
So how does technology empower the marketing of the entire scene to achieve customer value growth, customer experience improvement and marketing decision-making intelligence?
All answers are in the New Technology Marketing Application Trends White Paper.
