Seeking, as ever, to view the issue from an assortment of perspectives, we were treated to the opinions of a leader in digital practice within government, the managing partner of the UK’s leading digital marketing agency and a Chief Executive of a world-wide media group. Many thanks to Alex, John and Kevin for sharing their viewpoints and experiences (see below for our summary of the discussion), and to all those who attended and helped spark further debate when the matter was opened to the floor.

Alex Butler – the public sector’s view

As anybody who attempted to forecast the result of the recent election will attest, predictions are the business of fools. So those looking to guess where exactly the revolutionary road of digital will lead us are squaring up against an invincible opponent.

But whilst our crystal ball might be reluctant to yield a clear and detailed picture of digital’s future, we can at least be sure that it HAS one, and a great and significant one at that. Indeed, predictions aside, the hour of the webmaster is indisputably upon us. As the American anthropologist Margaret Mead foresaw, our world will be transformed not by the obvious heroes, by the traditional protagonists, but by a small group of thoughtful and committed citizens.

The scope of the digital medium should be underestimated at one’s peril; it is far more deeply penetrating, and potentially transformative, than the empty gestures of some companies allow for, dismissively believing that a simple increase in their digital marketing spend, a token tip of the hat in its direction, will suffice. To whom those accusations apply, beware: such behaviour exposes only a grave misjudgement about the relevance, significance and permanence of the medium.

Other than its scale, we can be certain of one further feature: the revolution will not be a purely technological one. Indeed, in terms of capability, we have already ticked nigh on all boxes, in the guise of more gadgets and widgets and gizmos than we ever might have hoped for. Still to be unveiled, however, is what this technology will enable us to do, what the future will look like once digital’s potential has been realised in full; as far as content’s concerned, the opening credits have only just begun to roll.

Those who claimed the 2010 election would be fought, and won, on Twitter have been forced to reassess their estimations. Yet beneath the eager prematurity of their predictions may lie something revelatory – for it hints at the shape this revolution could assume at full tilt. The potential might of this medium, it suggests, will best be realised when it succeeds in harnessing currents of opinion, growing heads of societal steam, to enact radical, unprecedented, against-all-odds change.

As many of its predecessors have sought to do before it, this revolution aspires to bring power back to the people. How it will do this, and what will result, is a question for those brave forecasters to ponder.

John Owen – the digital marketeer’s view

Digital is mainstream, of this there can be no doubt. But though it may have set up permanent residence in the everyday, infused our lives to the point of seeming saturation, its ubiquity does not in any way spell the end of its revolution. Indeed, the advent of digital has triggered an ostensibly unstoppable chain of reactions that bring change at an ever quickening pace, establishing a new state of play in which flux is permanent.

No more vivid a picture is painted of this than by the statistics themselves: if Facebook were a country, it would now be overshadowed by only China and India in terms of population. The iPhone, launched in 2007, sold 57 million units in its first two years of existence, making it the fastest-selling piece of technological hardware in history; and, based on its early performance, the iPad would appear to be living up to the standards set by such overachieving siblings.

Viewed in this context, established incumbents have never been so vulnerable. Operating in a world where the only constant is change, whole business models, though but newborn, find themselves under threat from impossibly younger upstarts. There is no room for complacency, no time to rest on smug laurels; the challenge for (short-lived) supremacy is unremitting and the ostensibly invincible must face up to this ceaseless insurgency, or condemn itself to defeat and supplantation.

Public reaction to this new breathlessly fast-paced landscape underlines the urgency with which businesses must respond: consumers have adapted with aplomb, seamlessly assimilating the language of tweets, newsfeeds and status updates into their everyday vernacular and embracing the tools at their ever-connected disposal to experience events in real time. And there is an increasing awareness that with this connectivity comes power: digital has given each a voice, endowing the everyman with the capacity to air and share his views, and join forces with similarly-minded individuals to bring amplification to their opinions. Indeed, the empowerment of the masses is no more clearly evidenced than by Rage Against The Machine’s derailing of the Simon Cowell steamtrain at Christmas, following a catalytic campaign on Facebook.

The implications for brand owners are vast. In this digital age, there is nowhere to hide, no safe, sheltered corner to cower in. Every move a business makes houses the potential to spark an online chain of Chinese whispers, for the better or worse – and the only defence lies in reaching out to this intangible ocean of observers and proactively engaging with their opinions. Answers should no longer just be sought within the confines of the boardroom; companies must listen to the voices from without – its workforce, its consumers, external developers – and be seen to reinstate the customer at the core of all business.

The companies best equipped for survival in this new terrain are those with the clearest sense of what they stand for as a brand and as a business – and with the integrity to articulate and live those values in practice. All will be judged by their words and actions, so the wisest will ensure that these are aligned with their core principles and vision.

Brands matter more now than ever before – and, in this new era of transparency, those with real substance, actively occupying their true position in the world, will be the ones that matter most.

Kevin Costello – the publisher’s view

With a third of the Western world on Facebook, to cite but one of the eye-popping stats in digital’s arsenal, it would be only natural to assume that the medium has become business as usual, so engrained is it in our collective consciousness. And yet still we find ourselves shocked and awed when a new wave hits, destabilising what went before and forcing a new configuration to establish itself in its wake. The truth is, the digital revolution is still rolling; only when this pace becomes a part of the normal working rhythm, when we cease to be surprised by what it yields, will it truly have run its course.

Indeed, relative to the long-established fields of medical, nano and quantum research, digital is still so young it’s barely more than a twinkle in its founding fathers’ eyes. The revolution is assuredly not over yet; this is simply round one.

Yet, to grasp what future forms it may take as it enters its maturity, we must first clarify what is meant by the ‘digital revolution’. For the term does not simply refer to the technological advances that have thus far played so defining a role in the movement; in terms of capabilities, the lion’s share has already been achieved, and the focus must now be on perfecting and fine-tuning these competencies. Similarly, the ‘revolution’ is also not shorthand for a cannibalistic overthrowing of print and other traditional media by digital; the latter coexists with the former, in complement, not mutual exclusivity.

In truth, this revolution hinges upon the audience, and the upheaval of user behaviour witnessed in response to technological innovation. Quite simply it has thrown down the gauntlet, daring businesses to square up to the challenges this reconfiguration presents. In this new user landscape, success and survival will depend on speed and flexibility, on a company’s capacity to adapt constantly to the ever-shifting dynamics of digital development; and, more fundamentally, on the business’ willingness to change – both its structures as well as its underlying attitudes.

Whether due to the scale of the revolution, or the speed with which it has taken root, businesses are being forced to operate in a world where evidence and consensus is increasingly hard to locate; decisions must be made without the support of hard numbers or the validation of a proven expert. To move forward in such a climate demands an entrepreneurial approach, inculcating an open and responsive culture in which the customer is god, and ideas are borne out and refined through pilots and trials.

This test bed spirit cannot be half-heartedly implemented and expected to yield results; it requires a supportive and well-aligned business structure to thrive in full, with clear KPIs, strict measurement, seamless content management systems and an openness that allows knowledge to be pooled and shared between channels.

As the digital revolution ripens, technology itself will play an increasingly marginal role, relative to the front-page billing that content will merit; indeed, the former is simply the enabler, allowing a singular and unerring focus on the end user experience, and the perfection thereof. After all, it is the message itself, and not the medium, that truly counts.

The issue is that sometimes the problem itself isn’t that obvious – even to the likes of a retailer with a turnover of $25bn. Having the customer’s best intentions at heart unfortunately counts for nothing when you have missed what they really think and feel about the journey you’re sending them on. A great example of how vital it is to truly see the world from the customer’s point of view.

Who would’ve imagined that changing a user interface button from ‘Register’ to ‘Continue’ in an online checkout process could increase sales by $300m in 12 months and the number of customers purchasing by 45%? It was only after the realisation that new users didn’t like the idea of having to form a relationship with the retailer to complete their purchase that the button was changed (along with the addition of a reassurance note to let them know they could make a purchase without registering). As one customer put it “I’m not here to enter into a relationship. I just want to buy something.”

The $300 Miilion Button article

The initial big step has been cultural – seeing complaints as an opportunity to improve business insight and customer experience, rather than something to be minimised.  This was turned into a plan for each HSBC country in three stages:

1. Make sure each customer making a complaint is happy by the end of the process – an outcome as much about empathy as resolving the issue.  This is more important than closing the complaint quickly, something regulators measure that can be counter-productive.  Some banks, focusing more on regulation than customer outcomes, resolve complaints without ever telling the customer and leave them feeling unsure.  In Canada, HSBC has a “Recovery with Flair” scheme, where central complaints staff can solve the problem themselves and then send an apology (e.g. flowers) to customers.

2. Make it easier to complain.  This seems strange – it increases the number of complaints.  But if most customers are happy with the process, then more complaints mean HSBC hears about more issues and gets a clearer picture of what needs fixing.  Often banks make you write to your branch manager to make a complaint.  HSBC India has a “grievance redressal” button on every page of their website, to make complaining quick and easy. 

3. Remove the root causes of complaints.  This reduces the number of problems out there, not just the number of complaints (total number of complaints is often measured by regulators, but this can discourage banks from listening to their customers).  Where shallow analysis might define “fees” as the root cause of a complaint, it is often about the way that fees are communicated.  HSBC Malaysia found that a charge for SMS updates was an unwelcome surprise for customers.  They now refund the fee the first time and clearly explain the charge to customers, removing the surprise and the feeling of unfairness.

Commenting on progress, Alex Matthews, Head of Service Quality, said ‘Although it seems counterintuitive that an increase in complaints can lead to improvements in customer experience, we have had support from across the world for this direction and it is now being implemented in countries as diverse as China, Canada, France, the UAE and the UK.’

Our guess is that if any other major British retailer were to have announced such a stretching ambition we would have seen an uprising in both press and public condemnation – but that is not the case for M&S.

As one of Britain’s best loved retailers, M&S has given itself permission to set these lofty ambitions whilst retaining staff and customer support. Most companies use their CSR initiatives to only talk about the good things they’ve achieved, inviting criticism from the press and public alike who focus on issues the company has yet to tackle. M&S took a much more nuanced approach by thinking big but consistently saying, in the words of Sir Stuart Rose, ‘we’re not where we want to be yet’.

This year Sir Stuart is moving into the role of Chairman but his time as CEO can certainly be characterised  by an unerring commitment and ambition for M&S to succeed not just on the balance sheet but also by making a difference to society as a whole – let’s hope the incoming CEO has the same utopian vision.

Ethical Corporation Article

To champion a blind reliance on data, divorced from intuition, would be a foolhardy move. But to overlook the potential for data to help us make better decisions would be equally unwise.

When data reinforces what our instinct is telling us, no questions are asked. Things begin to get interesting, however, when what it reports back strikes us as counterintuitive. It is at times like these that we must understand the superiority of machines at monitoring and processing vast amounts of data, devoid as they are of human bias and error.

Yet pitting data against intuition, as though the two were opposing forces, reveals a fundamental misunderstanding of their respective natures: for intuition is not without rational foundation but rather fed by life experiences, much as the treatment of data is not mindless number-crunching but a process of analytical rigour.

Gone are the days of primitive data analysis that saw credit cards declined at the slightest whiff of an uncharacteristic purchase – technological advances now mean that sophisticated models, imbued with intuition, are available and help avoid the false positives of yore.

Indeed, this progress in the field of data analysis has allowed for the mass production of intuition: much as the village greengrocer can make recommendations based on their knowledge of what the customer likes or what has proved popular with others, this era of loyalty cards, transaction histories and pattern recognition now means the same is possible on an industrial scale.

With the availability of data growing exponentially, and the capacity of computers to crunch this information in real time cantering along at an equal pace, the potential applications for data analysis are still revealing themselves, leaving us with a world in which genome-specific medicines no longer seem the stuff of science fiction.

Chris Clark – the client’s view

For all the patterns that numbers have the potential to paint, it is surprising that, when staring data in the face, we so often miss what it’s trying to communicate.

There is a tendency in business to respond to the news data brings us in a predictable, two-pronged manner: if the data tells us we’re doing well, we breathe a sigh of relief and forget about it; and if the data tell us we’re doing badly, it’s discounted as nonsense and forgotten about. Two different paths leading to the same pointless outcome.

Yet this reaction is indicative of the human response to numbers. The data might tell us one thing (that London is the safest city in the world, say) but the images we see, the stories we hear – which paint a picture more immediately evocative than numbers ever could – leave little more than a disbelieving public.

But it is about time we started looking at data differently – and seeing the pictures lying latent in the numbers. Far from the cold and inhuman beasts they are often billed as, numbers offer us an endlessly fascinating account of human behaviour, a front-row seat as the human condition plays out in all its glory.

When we read data, we mustn’t forget – or wilfully suppress – the head-start being human gives us in getting to the core of what the numbers are saying; it’s this gift of shared subjectivity that enables us to read the data creatively and in context, drilling down to its essence.

So rather than taking data and simply reporting it, or taking data and just rejecting it, we need to read it through the filter of our human experience and then use it in tandem with our intuition.

Indeed, as the grand masters of the chess world have long known, the key to success is tapping into that most underutilised component of the human condition, wisdom – which, at its essence, promotes a world viewed through the lens of experience and intelligence.

Boardrooms love their numbers, and rightly so – but it’s time to make room for human experience and intuition in there too.

Peter Wallis – the commentator’s view

We need look no further than the advertising world to see the historic dynamic of this debate in action. Where once agencies had been full service entities, chunks began to break free: media and money distanced themselves from the creative domain, leaving both sides speaking cruelly of the other. The former were nerds, if you believed the creatives; the latter were arrogant and fluffy, according to the number-crunchers.

Yet this tear would now appear to be sewing itself back together again. Take Gillian Tett, author of Fool’s Gold, as our example: with an academic background in anthropology, she found herself at the derivatives desk of the FT and, in her quest to make sense of this strange new world, lighted upon realisations about the potential trajectory of the industry, which the fantastically clever data specialists had failed to see coming.

In the one corner we therefore have the data miners, whose cautious nerdiness allows only for incremental market gains; in the other we find the boardroom bully, proud badge-wearers of their borderline psychopathy, capable of strategic leaps, but drunk on their own celebrity.

But enough! Enough of the archaic market research world that crowbarred apart quant and qual, designating them unnaturally as two separate corporate entities!

In the face of this madness, the answer is balance. We should interweave these two feeds, seeking to bridge the gap between the data robots and the snakes in suits.

The Foundation’s view

Yes, we concur that the idea of pitting data versus intuition is a most daft one…but it created a lively and stimulating conversation! Thank you Ray, Chris and Peter – and also to everyone in the audience who put the speakers on the spot or shared their own point of view.

Our reflection on the evening is that intuition must have room to be heard at the high tables of business – but not any old intuition. There is the lazy variety, filled with disabling prejudices, which will lead to poor and limiting decisions if left unchecked. There is also a different type of intuition – informed, engaged with the human condition, drawing on life’s experiences, stimulated and honed by the appreciation of data. This is what Chris called wisdom and what Ray meant when he said that ‘intuition prospers on a bedrock of knowledge’. The idea of informed intuition also lies behind Malcolm Gladwell’s 10,000 hour rule – mentioned by Peter – as being the time required to excel at anything.

The Foundation’s contribution to business can be seen as a desire to strengthen and stretch our clients’ intuition – both individually and collectively. And we do this by encouraging and creating space for ‘outside in’ thinking – for example reconnecting one on one with the customer, drawing on specialist academic and industry knowledge, learning laterally from other sectors, organisations and management teams, and working specialist researchers and data analysts. In so doing we are helping clients connect their right brain with their left, build their personal and corporate wisdom and, crucially, embolden their confidence to act upon it.

http://www.heralddeparis.com/29702/29702

FT article – on changing the basis of competition in the market / open & closed models:
http://blogs.ft.com/techblog/2010/01/john-gapper-google’s-open-battle-with-apple/

Google phone could up-end mobile space with ads:
http://digitalmedia.strategyeye.com/article/MFYZrnxLimo/2010/01/06/google_phone_could_upend_mobile_space_with_ads/

Microsoft and HP to join tablet frenzy:
http://digitalmedia.strategyeye.com/article/XdFP7zL2Iw/2010/01/06/microsoft_and_hp_to_join_tablet_frenzy/

Google supports Apple-Quattro deal:
http://digitalmedia.strategyeye.com/article/K2AZhEXVRpo/2010/01/06/google_says_it_supports_apple-quattro_deal/

http://www.ft.com/cms/s/0/25ead124-f70e-11de-9fb5-00144feab49a.html?nclick_check=1

http://www.hotelrafayel.com/