The transformation caused by new digital technologies, including big data, cloud, social media, mobile and digital marketing, continues to accelerate. And, as a result, the range of digital opportunities for B2B businesses continues to grow.
Digital technology points to enormous benefits: reduced costs, greater access to customers and suppliers, increased speed of supply, easier collaboration in vertical businesses and higher levels of transparency and reliability of information. But while the benefits are clear, the path to achieving them is not.
According to a study published in October by McKinsey, digital B2B businesses generate five times more revenue growth than traditional B2B businesses. The new digital consumer – the end user in the chain – super-informed and super-connected, has changed its buying habits and, therefore, the large B2B manufacturing and distribution companies are condemned to assume the change. Technology is a key factor but not enough on its own. There are other very important factors focused on business, people and experiences. Successful B2B companies have implemented some of the measures which are discussed below.
Probably the most critical attribute for success is the commitment to talent, giving it greater responsibility – something that is easier in organisations with horizontal hierarchies – with a focus, breaking some of the traditional concepts to lead the transformation and create a culture of innovation. It also focuses on core businesses that can benefit from digitalisation, modifying business models and reorganising structures.
THE MOST CRITICAL ATTRIBUTE FOR SUCCESS IS THE COMMITMENT TO TALENT
It is important to define a strategy with digital objectives and to implement a mindset that extends to the entire organisation. The most suitable platforms for the business must also be selected, abandoning the ones that aren’t. The establishment of centres of excellence has been an option for some B2B businesses by implementing specific programs, measuring the results, adapting and, if it works, extending them to other lines of business.
In the B2B field, the different operators in the value chain, partners and suppliers work in collaboration with their corporate customers and even with their competitors, exchanging information to plan, produce and distribute, in many cases adopting innovative and flexible agreements.
Making more intelligent use of granular information – the data – about customers’ habits to predict behaviour, boost sales, strengthen relationships and generate improvements, both in sales volume and quality as well as in conversion ratio, is another measure.
Today’s leading companies in the digital B2B transformation are struggling with the development of flexible multi-channel models, as customers want a unique experience and not to be treated differently depending on when, which channel – online or offline – and where they interact; and the complexity of high-value operations that require highly collaborative sales processes and the need to share benefits and risks in addition to many other quality and relationship issues.
It is important for traditional B2B businesses to understand that digitalisation is not a phenomenon that will disappear over time. It will affect, and even disrupt, entire industries.
Building a business focused on the needs of the client and, in turn, on the client of your client – who is usually the end user of the product – using new strategies, new business models and the digital technologies to approach partners in the value chain, a profound transformation of traditional businesses will be achieved. The financial sector has been one of the most affected by the changes to date and is proof of this. If your sector is not immersed in the transformation, it will be the next one.
True innovation, which changes the rules of the game, comes from understanding the needs of end users. We will find more and more B2B2C-type and more sophisticated collaborative relationships. New digital trends are emerging every day and it is still early to be decisive about the future, but really the transformation of B2B businesses – not to say B2B2C – is the great opportunity of the digitalisation era.
