4 drivers of transformation (1/3): Product and customer journey optimization

It isn't easy to convert technological breakthroughs into comparable breakthroughs in productivity and performance.

Today, we need productivity gains of at least 20%. The problem is that often the investments into new technologies are too high and investments into human capabilities are too low.

The technology is then not as useful as it could be. Technology must be applied reasonably and hand in hand with a broader transformation of how the business is conducted.

Illustration

Let's have a look at what the mckinsey.com website predicts about the first two drivers.

Product

Some companies have to both design and launch products more effectively. Advanced analytics will be combined with design to create values. Product design is necessary today for differentiation, because product functions are commoditized.

The latest design thinking will be combined with data and sophisticated advanced-analytics, which will provide insights into costs and value improvements.

For example, computer-aided design tools linked to large pools of data from various sources will help companies to design products with maximum profitability and minimum wasted effort.

Journey

The lean management perspective has been already applied to customer journeys. Now digital technologies and agile processes will enable us to make changes more easily and quickly. The scale will be greater and the impact profound. Technologies and processes will be improved by digital means.

An insurer, for example, reduced time to market for their new products from 18 months to just three. One global financial institution transformed customer journeys (total 80% of client interactions).

Faster decision making and willingness to test and revise quickly enabled it to improve customer experience. Sales conversions increased by 4-8%.

-jk-

Article source McKinsey & Company - global management consulting firm
Read more articles from McKinsey & Company

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