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Digital Strategy

04.07.2024 7 Min Read
Anna Katashvili

Management Consultant, Digital Strategist

Digital Strategy

In the dynamic landscape of the digital economy, businesses increasingly recognize the need for digital transformation to remain competitive and meet ever-changing customer expectations. However, the road to digital transformation is full of challenges. We have been told many times that starting this process without a clear digital strategy can result in misaligned processes, untargeted use of resources, missed opportunities, and high failure rates. A strong digital strategy not only provides a roadmap for organizations but also develops a vision plan for digital transformation that aligns with the organization's overall goals. This ensures that all digital initiatives are targeted and deliver results.

According to the teleological doctrine, every object has its purpose - "telos" - the fulfillment of which determines its success, effectiveness, and significance. Applying Aristotle's concept of telos to the context of digital transformation means recognizing the importance of foresight in digital strategy development. This approach encourages organizations to anticipate future trends, technological advancements, and assess emerging market dynamics. This proactive stance allows them to strategically position themselves in the digital landscape, fostering resilience and adaptability in the face of uncertainty.

By adapting teleological principles to their digital strategy, organizations cultivate clarity and confidence in their transformation journey. They have the ability to make informed decisions, prioritize initiatives, and mobilize resources to succeed in the digital age. This philosophical foundation not only sets the strategic direction of the organization but also enables alignment of digital transformation goals with overall business objectives and ensures concerted action at all levels of the organization.

Thus, based on Aristotle's concept of telos, the essence of digital strategy goes beyond operational planning. It is a transformational effort that aligns the overall purpose of the organization with the goals of digital initiatives. That is, the digital strategy should be developed taking into account a clear vision of the desired future state of the organization. This approach helps organizations envision a future where digital capabilities not only improve operational efficiency but also create a significant impact in a rapidly changing digital ecosystem.


Practical Implementation: Assessing the landscape through market and competitor analysis


Assessing the digital landscape through market and competitor analysis is crucial to transforming a philosophical vision into an actionable strategy. This involves conducting market analysis to identify trends, consumer behavior, and competitor strategies. Noise Analysis is a valuable tool that provides a structured framework for identifying competitive advantages and areas for improvement.

By utilizing NOISE analysis, organizations can identify both internal and external factors that can influence their digital strategy. This approach focuses on needs, opportunities, improvements, strengths, and exceptions, allowing organizations to comprehensively assess their current state and identify actionable steps to capitalize on areas for improvement and strengths. This holistic view ensures that digital strategies align with real-world conditions and organizational capabilities, enabling targeted and effective initiatives.

The advantages of noise analysis include:

- Comprehensive overview of the business: It offers a 360-degree view, leveraging strengths to address immediate needs, improvements, and opportunities.
- Accurate prioritization of tasks: Identifying potential opportunities alongside urgent needs helps strategically allocate resources such as time, budget, and team members.
- Identification of competitive advantages: Recognizing what sets a company apart from its competitors helps capitalize on unique strengths.
- Increased efficiency: Comprehensive analytics uncover potential bottlenecks, enabling proactive strategies rather than reactive solutions.



Strategic planning: developing detailed action plans


Following a thorough understanding of the digital landscape, organizations can then develop detailed action plans to implement their digital strategy. These plans define the initiatives, projects, technologies, timelines, and milestones necessary to achieve strategic goals. Strategic planning methodologies like Hoshin Kanri ensure alignment between strategic goals and operational performance at all levels of the organization, promoting consistency and efficiency in digital transformation efforts.

The Hoshin Kanri model, also known as Policy Deployment, is a strategic planning process that aims to systematically implement and operationalize an organization's goals at all levels. This model harmonizes strategic goals with day-to-day operations by establishing clear goals, developing actionable plans to achieve them, and continuously revising and refining those plans. By adopting the Hoshin Kanri approach, organizations can consistently align their digital transformation initiatives with long-term strategic goals, facilitating coordinated action and efficient use of resources.

(Akao, 1991)[1]



Creating a Digital Team



Building a successful digital transformation requires a highly skilled and diverse team. This team should include digital leaders, digital transformation managers, IT experts, data analysts, and change managers, all bringing specialized expertise. The collaboration between these different roles is crucial for the strategic planning and execution of digital initiatives.

To assemble a team with these skills, organizations can adopt a resource-based approach (RBV). The RBV approach emphasizes the importance of leveraging unique skills and capabilities within an organization to gain a competitive advantage. By focusing on internal resources that are valuable, rare, inimitable, and non-substitutable (VRIN), organizations can establish a strong foundation for digital transformation.

(Barney, 2011)[2]


Utilizing the RBV approach allows organizations to strategically build a digital team that can effectively seize opportunities. This approach ensures that the team is not only capable of implementing digital strategies, but also sustaining them in the long run. The integration of diverse skills and perspectives fosters innovation, operational excellence, and continuous improvement.



Leveraging Advanced Technologies


In the digital age, a successful digital strategy relies on the integration of advanced technologies. These innovations are not only crucial for enhancing operational efficiency, but also for enabling personalized customer interactions and fostering innovation.

Therefore, technologies play a crucial role in the process of digital transformation. By analyzing vast amounts of data, organizations can make data-driven strategic decisions. This includes understanding consumer behavior, optimizing the supply chain, predicting market trends, and improving product development. As a result, organizations can identify opportunities and challenges early on and respond swiftly and effectively.

Automation and intelligent systems are revolutionizing the business landscape by simplifying complex processes, empowering decision-making, and driving innovation. These systems can analyze patterns, make predictions, and offer recommendations, significantly enhancing efficiency and accuracy across various business functions.

The concept of technological determinism highlights the transformative impact of technological advancements on business operations and strategic outcomes. It suggests that technological progress shapes societal structures and cultural values, leading to change that is often beyond the control of individual organizations. In the context of digital strategy, this means that adopting and integrating advanced technologies can modernize business processes, create new business models, and alter competitive dynamics

(Orlikowski, 2008)[3]


By embracing technological determinism, organizations recognize that technology is more than just a tool; it is a catalyst for transformation. This perspective encourages businesses to proactively adopt technology and constantly explore new developments to stay ahead of the game. It also emphasizes the need for a strategic approach to technology implementation, ensuring that technology investments align with overall business goals and deliver measurable results.



Agile approach and continuous improvement practices


Agility refers to an organization's ability to quickly respond to unforeseen challenges and seize new opportunities. Taking this approach ensures that the digital strategy remains relevant and effective in the face of changing market dynamics, technological advancements, and competitive pressures

(Rigby, 2018)[4]

Continuous improvement is the foundation of an effective digital strategy. Regularly measuring digital initiatives against key performance indicators allows organizations to refine strategies, strengthen processes, and achieve better results. This approach, based on the Kaizen philosophy, promotes continuous improvement and innovation in products, services, and operations (Imai, 2012)[5]

Kaizen, which means "continuous improvement" in Japanese, is a philosophy that focuses on making small, incremental changes to increase efficiency and quality. In digital strategy, applying Kaizen principles means regularly reviewing and refining digital initiatives to ensure they align with organizational goals and market conditions. Such a focus on continuous improvement helps foster a culture of innovation and excellence that leads to long-term success in digital transformation efforts.



Implementation and Maintenance of Digital Initiatives in Practice


Implementing digital initiatives is a critical step in digital strategy. It not only boosts stakeholder engagement, but also establishes a strong foundation for long-term success. However, sustaining momentum beyond the implementation phase necessitates continuous innovation, evolution, and expansion of digital capabilities. This ensures that each subsequent phase of digital transformation delivers even greater value and impact.


Essentially, a well-crafted digital strategy serves as the foundation of an effective digital transformation. By seamlessly integrating market and competitor analysis, strategic planning, technology innovation, agility, and continuous improvement, organizations can effectively navigate the complex digital landscape. Utilizing comprehensive digital readiness assessments as a diagnostic tool ensures that an organization remains agile, responsive, and prepared to tackle future digital challenges and capitalize on emerging opportunities.

This comprehensive approach not only facilitates the achievement of transformational objectives but also establishes a solid groundwork for sustainable growth and competitiveness in the digital era. By adhering to these principles, a business can chart the appropriate course, attain long-term success, and position itself as an industry leader.



[1] Akao, Y. (1991). Hoshin Kanri: Policy Deployment for Successful TQM. Productivity Press. 

[2] Barney, J. B., Ketchen, D. J., & Wright, M. (2011). The Future of Resource-Based Theory: Revitalization or Decline? Journal of Management, 37(5), 1299-1315.

[3] rlikowski, W. J., & Scott, S. V. (2008). Sociomateriality: Challenging the Separation of Technology, Work and Organization. The Academy of Management Annals, 2(1), 433-474.

[4] Rigby, D. K., Sutherland, J., & Noble, A. (2018). Agile at Scale. Harvard Business Review, 96(3), 88-96.

[5] Imai, M. (2012). Gemba Kaizen: A Commonsense Approach to a Continuous Improvement Strategy. McGraw Hill Professional.


Featured Insights
07.06.2024

For almost two months, our country has faced a serious political crisis. By initiating the so-called "Russian law," the government has openly opposed the Georgian people's desire to join the European family and democratic world. This decision was finalized on May 27. Growing up in the Soviet Union, I understand the realities of authoritarianism, restricted freedom, and inequality. Having witnessed and participated in the collapse of the Soviet Union and the building of a free Georgia, I deeply grasp the significance of democracy and European values. Based on experience, I can assess our country's risks and opportunities if the people's will does not prevail in this struggle. This is why all my thoughts and emotions now revolve around our country's fate and this political crisis.


The article addresses the challenges faced by organizational leaders during political crises. In light of current events, I aim to explore and answer several critical questions: What implications does a political crisis hold for leaders of private organizations? How can leaders manage stress effectively? How can they maintain or restore their leadership strength when they themselves are facing difficulties? And, how can they guide their team and organization through such turbulent times?


Challenges of Domestic Political Crisis


 First, we must agree that a political crisis within a country is significantly different from other types of crises, such as an economic crisis or a war with an external enemy.

During an economic crisis, the rules of the business game change, market conditions shift, and the private sector's status quo is altered. Businesses need to recognize the symptoms of a crisis in time, quickly adapt to changes, think creatively, and take bold steps.


In a war, all the factors of an economic crisis are present, with the added threat to organizations and people's lives. Faced with an existential threat, all other threats pale in comparison. Fighting an external enemy stimulates patriotism, unity, and mutual support. In this situation, business interests, ambitions, and goals take a backseat, and leaders focus primarily on the survival of the people and the country.


A domestic political crisis is very different in nature. There may not be an immediate economic or existential threat, but it is a war of values. Values are the foundation of our "self," and our identity and belonging (to relatives, colleagues, friends, or country) are under attack. If the crisis is not overcome in time, there is a long-term risk of an economic crisis, loss of freedom, and existential danger. In such a situation, people may have to fight for survival not against an enemy but with a loved one, as we have seen in recent Georgian history.


Therefore, in my opinion, an internal political crisis is the most difficult situation for leaders. To navigate it, leaders must have great inner strength, caution, and courage.


Leadership strategies


Fear, stress, anger, irritation, emotional agitation, a complete lack of energy, difficulty focusing on work, a feeling of weakness, a sudden desire to fight, the desire to give up everything, a sense of responsibility and shame for one's weakness, calling out to oneself, taking action, and then again fear, stress, anger... Do these emotional roller coasters sound familiar? If so, I'd like to reassure you that this is a natural reaction to the challenges described above. Moreover, this emotional background is common to everyone, not just leaders.

Now imagine an organization where all employees and leaders are in this emotional state... It's a bleak scenario indeed. Every leader realizes that finding a way out of this situation is their responsibility, but the main question is how. How do we lead effectively in such chaos? How do we maintain our emotional equilibrium, clarity of thought, and resilience? More importantly, how can we harness the energy of stress within our organization and transform it into a force for positive change and growth?

Reflecting on these challenges, I've embarked on a personal quest to uncover strategies that enable me to fulfill my leadership duties with clarity and purpose each day. And now, I invite you to join me in this exploration. Let's share our insights, our triumphs, and even our struggles. Together, we can navigate these turbulent waters and emerge as transformational leaders, guiding our organizations through the storms towards calmer shores.


1. Accept Reality: If there is no problem - there is no solution. Therefore, not recognizing what is happening to us—both the current events in the country and our emotional stress—means leaving reality. The first step is to accept reality. We must correctly assess the scale of the crisis, the risks facing our organizations, and the degree of stress on ourselves and our team members. Acceptance of an unwelcome reality serves as the foundation for effective problem-solving.


2. Stay Informed: In times of crisis, staying informed about current developments is imperative for making well-informed and prompt decisions.


3. Prioritize Self-Care: To support others, the leader must be resourceful himself/herself. Leaders often make the critical mistake of focusing solely on solving problems during a crisis and forgetting to take care of themselves. A leader's physical, mental, and emotional well-being is directly related to their resourcefulness. Self-neglect weakens and exhausts the leader, diminishing their ability to make effective decisions. Even amidst high stress, dedicating time to self-care routines can provide surprising strength. For instance, incorporating daily exercise, meditation, or pursuing personal interests can significantly contribute to maintaining physical and emotional resilience.


4. Create A Supportive Environment: Leaders, like everyone else, experience fears, anxieties, and vulnerabilities. During times of crisis, it's essential to surround oneself with a supportive network of individuals who provide strength and energy. Whether it's family, friends, partners, or professional support like psychologists, drawing upon external sources of support is crucial for resilience.


5. Share Responsibility: Effective leadership entails sharing both power and responsibility with the team. Particularly in times of crisis, leaders should not bear the burden alone. Trusting the management team, fostering open discussions about risks and challenges, making collective decisions, delegating tasks, and jointly assuming responsibility for outcomes are vital strategies for navigating crises and managing stress.


6. Empathy and Effective Communication: Internal political conflict is one of the most difficult crises because society is divided and opposed to each other. We should not forget that an organization is also a community—a community united around one idea and goal. Consequently, the division that exists in society is likely to appear in the organization as well (especially in large organizations). If the responsibility for stabilizing society and the situation across the country falls on the government, within the organization, this responsibility rests with the leader and the management team. Therefore, the leader and management team must ensure effective communication within the organization, eliminate conflicts and restore or strengthen trust among employees. This can be achieved by bringing common interests to the fore and relegating differences to the background. For example, “We all want this country to develop”; “We all want more stability and security”; “We are all in this crisis together, and the consequences (both good and bad) will affect everyone”.


7. Leading by Example with Values-Based Decisions: In the context of internal political controversy and such an underdeveloped democracy as Georgia, publicly stating an opinion contrary to the government's position is risky. The leader of any private company is aware of this risk, which is not only related to the potential loss of business or income but also to the jobs and safety of employees. Therefore, leaders who do not share the ruling power's position on the "Law on the Transparency of the Influence of Foreign Powers" (the so-called Russian law) face a big dilemma. If they raise their voice and openly protest the government's decision, they risk their own and the organization's well-being. On the other hand, if they do not speak out or support the ruling force contrary to their beliefs, they lose self-respect and the trust of their employees, ultimately morally destroying the organization.


Advising leaders on this issue is challenging. However, one thing remains clear: leaders will have to make a choice and assume responsibility for the associated consequences

03.06.2024

Uncertainty is the cornerstone that defines the global marketplace and on which it ultimately depends. Conflicts such as political, trade, and social instabilities, among other factors, are known to upset this balance, presenting a challenge to international business. These disruptions could vary from direct supply chain interruptions to direct refusals of the consumption of the company's products, which can produce drastic effects in different corporations. Especially during such periods of uncertainty, communication, and marketing assets are vital instruments in weathering these storms and preserving the corporate image.


Modern Political Risks and Their Impact


For a long time, organizations were primarily concerned with operational risks, or more specifically, with economic and financial risks only. But soon, McKinsey & Company, in its Emerging Risks on the Global Agenda ([valid URL added]), presents political instabilities as one of the upcoming risk management concerns. This paper, informed by interviews with IT executives and the analysis of political risk data, highlights how vital it is for organizations to plan for political disruptions and need to have specified marketing communication plans. Politics, social issues, and the shifting geo-political landscape are key drivers that can challenge supply chains, undermine stakeholders' confidence, and diminish branding. These are some risks companies can face, and a proactive crisis communication and marketing strategy should not be lacking.


Crisis communication, a vital aspect in managing crises, is planning the type, content, channel, and timing of communicating and interacting with stakeholders during crises. This definition is also based on the standards of operation provided by the International Public Relations Association (IPRA), which is recognized as the world's premier association for public relations professionals. It only takes one communication slip during an incredibly volatile political period to significantly harm stakeholder trust and company image. On the other hand, effective communication management is an invaluable tool with little or no adverse effects because the public gets a positive impression of a company's responsible behavior during a crisis.


Critical Considerations for Efficient Crisis Messaging During the Political Hard Periods


Appropriate measures of crisis communication establish the radar for organizations to continue their operations unhampered by the disruptions of storms of a political nature. Here's how companies can establish a foundation for clear and impactful communication: 


Proactive Risk Identification: Businesses must understand politics. They have to adapt and deal with it. For this reason, the different institutions must analyze possible political risks regarding operations to identify weaknesses.


Building a Rapid Response Infrastructure: Crisis communication cannot afford to be slow. Organizations must set up a crisis communication team to react quickly to incipient decisions and disseminate them correspondingly. This team should comprise personnel from different departments, among them public relations, legal, and marketing departments, in case any issues arise. Efficient operational plans for precise and fast reactions should be set and agreed upon beforehand to avoid confusion and the formation of weak links.


Transparency and Empathy in Action: Maintaining and promoting ethical business conduct throughout the crisis cultivates business and consumer goodwill (in line with the communication principles highlighted by the IPR, 2023). For instance, Patagonia, a company famous for being an active voice in environmental issues, seized a political crisis – the U. S government shutdown – to bring to light its dedication to promoting sustainable practices; this is because the company ceased every advertising campaign during the events.


Multi-Channel Communication Strategy: Stakeholders' communication must occur using a comprehensive communication tool kit. The best way is to develop different messages for every social network because each is unique in some way. While a press release can formally announce events, social media is timely, open, and personal, providing status updates.


Crisis management and business continuity


Crisis communication plans can only fulfill business continuity and crisis management. This plan should outline action procedures associated with communication during risk management and supply chain disruption and accommodate protocols for employee safety and disaster response (Disaster Recovery Institute International [DRII], 2023). You can be confident that crisis communication advocates an essential aspect of these strategies, which involves the timely and accurate flow of information to all key stakeholders.


Adapting to marketing plans and strategies during a crisis has become necessary as a managerial strategy. Crisis communication is an inevitable communication activity in organizations, and it should be aligned with marketing communication strategies to keep the masses constantly informed about the firm's brands and products. This may involve:

  • Adapting Marketing Messages
  • Utilizing Social Media for Authentic Engagement
  • Pausing Insensitive Campaigns


Delving Deeper: Crisis communication and marketing are two key aspects organizations must consider, especially when running a business.

The harmonization of crisis communication and marketing during hard political periods are critical strategies that should be employed to ensure reputation management. Here's how businesses can achieve this.


  • Maintaining Brand Voice and Values: Companies must ensure that when communicating during a crisis and with customers in general, they adhere to their brand's fundamental values and tone. Maintaining consistency is an essential factor since it helps people develop trust and credibility in the brand's response to the crisis that is being faced.
  • Corporate Social Responsibility (CSR): Crisis response is another factor that raises the importance of a strong CSR strategy, as it will become a powerful weapon when the company is to defend itself from the negative consequences of the crisis.
  • Building Brand Support Through Transparency: There is a great degree of trust put in companies that are transparent within the climate of crisis communication.


Today's world can be described as vague, with politics constantly volatile. Therefore, everyone should strive to employ an integrated approach to crisis management in the event of such storms.