When a business must go digital to grow
A specialty business-services company was very successful financially—but management knew that the company had to transform if it hoped to remain competitive in the future. Specifically, they recognized that the company had to go digital—by applying software tools to automate business processes so it could speed up transactions and rely less on manual work.
The company made a few bold attempts to change, but with no breakthroughs. The situation was tricky: the business comprised two newly merged units that previously had been standalone firms. One unit had fairly simple products and made extensive use of technology. The other had a complex product portfolio, with systems customized to cater to individual clients with a heavy reliance on manual methods. Managers in the tech-savvy business unit thought they could simply use tools like open-source software to “fix” the sister operation, but it wasn’t that simple. For one thing, the labor-intensive unit was profitable, so few staff there saw any reason to change. Senior management disagreed—and called on AlixPartners to help them find a solution.
A labor-intensive model becomes a model of digital excellence
When our digital experts took a closer look, we saw an organization that resembled a collective of many different companies, each with its own business model and data for serving its clients. Such a model meant there were neither common data nor common algorithms supporting shared business processes.
Our team conducted our eight-week proprietary QuickStrike® diagnostic, which shed light on how the company could streamline business processes ranging from organization design to system architecture. The successful exercise inspired the company to undertake a full technology overhaul aimed at embedding analytics in the company’s daily operations. We began that overhaul by introducing the principle that we bring to all digital transformations: the need for a comprehensive, clean, current data set. With backing from the CIO, who understood the difficulties inherent in digital transformation, our team began working on a “data platform” that streamlined data ingestion, management, storage, and use. The single platform was built to support rapid development of predictive and deterministic business models. It also featured real-time reporting that informs data-driven decision-making. Importantly, we designed the single data platform, simple interfaces and real-time reporting to interact with and inform each other.
In this services business, speed of analysis is critical. A day—even an hour—can make the difference between handling a task and losing it to a competitor. As part of the project, we made analytics tools accessible to everyone in the organization. Finally, we laid the foundation for machine learning, so more of the company’s routine decision-making could be supported—and augmented—by automation, freeing up management to concentrate on the truly strategic concerns.
When it really matters
The business-services company has indeed gone digital, and is now in a much stronger position to compete successfully in the long run. With a new common data platform in place, employees throughout the company can share pertinent information quickly and easily. The company has been able to boost sales at some operations by at least 50% while reducing labor costs by 50% to 90%. Data inputs that used to take days now take minutes. Operations that previously needed a week now happen in half a day, helping the company win more business from time-sensitive customers.
Equally important, the company has been able to transition smoothly from a labor-driven administrative model to one based on analytics and generating new IP. All of this has enabled the company to achieve impressive process improvements, develop innovative products, and go to market in new ways. What’s more, people throughout the company increasingly see the software not as merely a “bunch of tools” but as a path to systematic learning. More and more staff now view themselves as data analysts, and data coders and modelers regularly present their findings to management. For their part, those leaders increasingly talk in terms of their industry being transformed by tech innovation. The staff are also diving into the data themselves to find and apply new innovative products. And they’re challenging each other and their teams to do the same.