As Head of Digital Transformation at Google, Joris Merks-Benjaminsen works with top 100 companies, helping them to embed digital thinking directly into their strategies. We recently caught up with Joris, following his book ‘Online Brand Identity’ being nominated* for Best Marketing Literature of 2015.
*Editors Note: Since catching up with Joris, ‘Online Brand Identity’ has gone on to win the Best Marketing Literature of 2015. Congrats Joris – we hear you’re the first person to ever win this award twice!
So, let’s get talking – innovation, digital transformation and leadership… with Joris Merks-Benjaminsen.
BQ – Why do we need agility and experimentation built into our digital strategies?
Joris – Both because we have to and because we can.
We have to because digital change moves lightning fast, while at the same time complexity and competitiveness increase. That means you have less time to adapt to new developments, but you still need to go through a learning curve to do so. Therefore, you have to start right now even if the exact solution isn’t fully clear yet. The good thing about digital is the fact that you can steer on real-time response – so the earlier you start, the earlier you get feedback and the earlier the best solution emerges for you.
Always have an innovation budget that you don’t evaluate based on short term ROI I often see clients get stuck on digital transformation challenges because you can’t really prove upfront, how much impact and ROI you will get if you try something you’ve never done before. You can only measure the impact of something you’ve never tried, after you do it. That is the biggest challenge of digital transformation. If you want proof of ROI before you start a project, you will never start it. This is why you must always have an innovation budget that you don’t evaluate based on short term ROI.
BQ – How can we shift thinking from ‘experimentation = cost centre’ to ‘experimentation = investment in ROI’?
Joris – The perception that experimentation is just a cost centre is more a measurement problem than lack of impact.
Take mobile for example – it is one of the hardest digital transformation challenges almost all companies face. In advanced countries, the majority of all internet traffic goes through mobile devices. However, website experiences are often still made for desktop, and mobile payments are, for the most part, not very user-friendly. As a result of this, consumers often start their journey on a mobile device but still end up buying on their laptop or desktop computer. Measurement systems aren’t designed to handle that.
As long as a person completes the full consumer journey on one device within a relatively short time span the measurement works fine. But, as soon as consumers switch devices it becomes harder to track sales impact. This doesn’t mean mobile isn’t impactful; it is just a measurement problem.
If you look at consumer behavior, it is pretty clear companies should be investing in mobile. However, this is also one of those “chicken-egg” problems. If you wait to invest in mobile until people start buying more on mobile, you will never do it, because people don’t buy on mobile if you don’t offer them a good experience. You need to keep investing in a great mobile experience because you know mobile has a crucial role in the consumer journey. Only then will you be able to update your measurement systems over time and gain the ability to quantify the true value of mobile.
Once you understand that innovative experiments are just harder to measure in the short-term, you will start to see they are not just waste of budget. In fact, if you don’t innovate enough you will eventually lose your entire business – and that is something everyone understands.
BQ – What is the best way to overcome stakeholder fear of the unknown / failure?
Joris – If you look at this from a leadership perspective, you could rephrase the question as “how can leaders help their employees be less afraid to fail and experiment?” If leaders can achieve that, they have established one of the most important ingredients to keep their business sustainably successful.
The problem of innovation and digital transformation is that it is always more work and more risk. Innovations never fit existing processes, and you never know whether they will succeed or not. People in your company will only be willing to pick up the extra work and risk if they know they will receive a reward for doing, so instead of getting backstabbed when the project fails.
Company leaders can create a culture like that by formulating a clear vision about what they think the world looks like five years from now, and what challenges the company needs to fix to maintain readiness for that future. They can establish awards for those that nail important transformation challenges, but also for those that fail in a way that allows the company to learn important lessons.
At Google, we have what we call the “courageous penguin award”. If a group of penguins needs to dive into the water to find food, one of them must dive in first, to check if there is a predator in the water or not. That penguin risks their life to save those of all the others. A person trying something new always takes risks. If things go wrong but the company learns valuable lessons – that should be rewarded.
You need to celebrate the good loudly and filter the bad silently. With the right mechanisms in place, people start looking at innovation as a career opportunity rather than more work and more risk.