As with all digital transformation content, it’s sometimes easy to get caught ‘blue sky thinking’ without thinking of the short-term viability of ideas. The difficulties come from the spectrum of understanding and ability to really make deep change in an organisation, while some truly agile organisations such as Amazon can spin up new business ideas or HBO moving to an online subscription model to consume content, others are more entrenched in the way they work and the way they view their processes.
Some organisations view becoming digital as setting up a twitter account, while others view it as some impossible task which will lead them to a full virtual reality storefront hosted by automated robots. The reality is often somewhere in the middle, and while it’s good to have an end goal in mind, taking the appropriate steps to achieve it is where risual really helps businesses.
One of our heavily publicised benefits of transformation is ‘unlock new revenue streams’ which may be interpreted that risual consultants come in and point out that you could sell your product online. This is not the case, selling a product in a new place is not a new revenue stream, it’s a new channel for the same revenue stream and is something most businesses have already considered, tried and succeeded in doing. A transformational approach is to look at what is generated in the process, and how to monetise that.
For example, the town of Burton-On-Trent was once home to more brewers than anywhere else in the UK, and at one point the beer produced in this town accounted for a quarter of the UK beer production. Beer, as with any factory produced item, once produced needs to be sold to ensure maximum revenue, every business there would need to sell what they produced at different prices to ensure they made as much as they could from that batch of beer. However, in 1902 Burton-On-Trent became home to another well known business, Marmite. The business was set up in a disused malthouse, two miles from the Bass brewery.
As this guardian article states “Its proximity to Bass was, of course, no accident. Marmite is made from the yeast that is a byproduct of the brewing industry. A German chemist, Justus Liebig, realised that the brewers yeast could be made into a natty little concentrate, with a sort of meaty flavour. Today, some of the yeast extract used in Marmite still comes from the Bass brewery, along with other breweries in the vicinity.”
This is an example of unlocking a new revenue stream, breweries were producing yeast extract for years, but it was thanks to Justus Liebig using technology to realise the potential for this waste product, a whole new multi-million pound business could be formed, making the brewers more money despite producing nothing new in their process.
To put in modern terms, all businesses produce data, intelligence, and waste products. For example a logistics company has a detailed database of where everybody lives, what they have delivered and what they purchase together, could they not look to monetise this through a shared digital platform for their suppliers? Audi, a car manufacturer expect to make half of their total revenue from digital and IT services by 2020, by realising they can resell, upsell and cross sell technology that compliments their core business, they are doubling their revenue despite building the same amount of cars. It is this approach to technology where risual has expertise, we can look at your business processes and wastage in a new light to help you understand and monetise new areas of the process.
All businesses need to work to ensure they react to digital environments, and like marmite in 1902 need to understand where and how they can drive additional revenue from their core business. So while ‘you either love or hate’ the buzzwords within digital transformation, doubling your revenue by ‘spreading’ your bets and offering innovative approaches to processes and data is too good an opportunity to miss.