ROLE OF THE BOARD IN A OMNI-CHANNEL TRANSFORMATION
The implementation of an Omni-Channel initiative can yield significant rewards, but it also carries substantial risks that can threaten a company's value and continuity. Given the potential impact on a company's health, it is essential that the initiative be more than a mere technology project and instead be prioritized by board agendas to ensure good governance and due diligence.
An Omni-Channel platform transforms not only technology but also business processes, skills, roles, responsibilities, organizational structure, policy, strategy, culture, and most crucially, the customer experience. By providing a single platform for website, mobile, retail, telephone, in-home, and virtual channels, Omni-Channel simplifies digital channels and enables marketing optimization, new market penetration, increased average order value, and other substantial benefits. However, it is the integration of the digital and physical worlds that defines the modern customer experience. A well-executed Omni-Channel experience can create a true competitive edge, but in this fast-paced, technology-driven world, it will eventually become standard. Technologies such as augmented reality, virtual reality, meta verse, and the concept of "presence" will soon be built on these infrastructures.
Historically, new technologies have produced varying degrees of success for companies, as exemplified by the history of ERP. While some companies have been surprisingly successful in implementing ERP, others have experienced valuation hits and even business failures. Winning or losing is not about the technology itself, but rather how it is considered from a strategic perspective, how it is governed to extract the most value, and how the associated organizational risks are managed.
Omni-Channel is not just a project; it is a transformation that requires active management of risks, issues, and conflicts. The board's role is to ensure that management is engaged and that high-level issues are being addressed. This includes dealing with customer adoption concerns, channel conflicts, service delivery issues, talent resistance and motivation, organizational change, pricing, and more.
Therefore, we argue for board involvement and strong governance in an Omni-Channel effort. How the initiative is strategized and governed will define its success as a technology-led business initiative. An Omni-Channel initiative can have an outsized impact on a company's value compared to its implementation cost, so it is the board's responsibility to ensure that good governance and due diligence are applied to its approval and organizational transformation
How can the Board Ensure Value Capture from Digital or Technology Initiatives?
In today’s rapidly evolving business environment, many initiatives are presented to boards with promises of high ROI, improved competitive positioning, and reduced costs. However, even when post-implementation reviews and lessons learned are conducted, many boards fail to capture and synthesize the most important data into actionable insights.
While reviewing schedules, budgets, and staffing changes and discussing project risks are important, they are not sufficient for successful transformations. Transformations are strategic in nature and require a solid understanding of external market forces, competitors, and how to leverage internal capabilities to compete.
It is essential for board directors to track their competitors’ digital initiatives. This can be easily done by setting up a few keywords in Google Alerts, which will notify the board of any competitor moves. However, simply getting this information and sharing it is not enough. Each director must leverage their background in strategy, organization, marketing, sales, talent, and digital business models to evaluate the potential impact of competitors' actions.
A digital director can help ensure that all directors are well-versed in digital business models, strategies, and operating models, enabling them to better evaluate the substance of any threats. Best practices today include board review of each strategic digital initiative, which should be conducted by every board. To strengthen the overall effectiveness of high-risk/high-reward initiatives, boards should adopt a broader information gathering and assessment process that considers external market forces that could negatively impact the transformation.
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