Updated: Jul 31, 2018
Myopia | noun | my·o·pia: a lack of foresight or discernment: a narrow view of something. Merriam-Webster.
It was a dark era for the railroad industry. Some railroad businesses failed, and some suffered a steep decline in their businesses as a result of competition from, at that time, the emerging aviation industry and the uptake of motor vehicles usage. In a Harvard Business Review article titled “Marketing Myopia”, Theodore Levitt asserts that railroad businesses failed not because of the declining use of railroads by customers opting to use airplanes and cars, but rather because the management of railroad limited their view of their business as only a railroad transportation provider. If they only widened their perspective to the broader industry of transportation and focused on what their customers need (i.e. moving from point A to point B, regardless of the mean of transportation), maybe then they had a chance to survive.
Yet, Businesses Don't Learn from Past Mistakes
Every business strives to sustain growth. Nevertheless, executives set up their selves for failures because of two things. First, they limit their view to their current business activities rather than looking at the industry as a whole (e.g. railroad vs transportation). Second, they think in terms of products not what their customers want.
Nevertheless, businesses continue their limited perspective and point fingers to market saturation or sluggish economy. If only brick-and-mortar retailers focused on their customers need for shopping regardless of the medium (i.e. physical store vs Internet), they would have had a better chance to survive against Amazon and eBay. If Kodak understood their customers need and widened their perspective over a product-limited view of selling film-based cameras, they could have avoided filing for bankruptcy protection back in 2012.
Therefore, to achieve sustainable growth, businesses must widen their perspective by:
Look at the macro industry and which they operate in, not only the current line of business.
Focus on customer experience and needs, not pushing specific products and services.
Examine disruptive technologies and business models occurring inside and outside their industry.
The same lack of foresight to the benefits of digital business is happening now. The perspective of executives on what digital means to their business will determine its impact on their business. If the executives have a limited view of what digital technologies can do for the company, then they shall expect mediocre business outcomes. In retrospect, to really maximize the benefit to the business, it's crucial to have a broader perspective, going beyond seeing digital as a merely an automation tool or even a set of technologies to improve the customer experience, to seeing it as the opportunity to transform the business that can grow and thrive in the digital era.
Widening Perspective To Achieve Business Growth
There are primarily three perspectives when it comes to how Digital can contribute to the business:
Automation Perspective: is the use of technology to automate business processes and transactions. When business executives confine digital to this perspective, the business outcome of their digital initiatives will be limited to an efficient and effective business.
Customer Experience Perspective: is the use of technology to acquire new customers and increase customers retention. When business executives confine digital to this perspective, the business outcome of their digital initiatives will be limited to growing market share in their industry.
Digital Transformation Perspective: is the use of technology, not only to automate and elevate customer experience but also to build a new set of capabilities that able to create new sources of revenue through extending the current business model to the digital ecosystem.
The infographic below illustrates the above:
Reaping the Digital Benefits
To avoid Digital Myopia, business executives are encouraged to widen their perspective on how Digital can benefit their business and their customers. As technology is weaved into the fabric of our lives, its shaping our habits and expectations. Such habits and expectations should be examined by businesses to ensure that they stay relevant to their customers and to strive to add value to them. Business executives, therefore, need to determine the vision of their business in the digital era. Once the vision is set, executives then need to devise and execute a strategy to position their business in the digital age.
By Ahmed Albalooshi
Relevant article: DNA of Digital Masters