– by Christopher Angevine, Christoph Erbenich, Candace Lun Plotkin, and Michael Viertler
B2B companies have heard the digitization message loud and clear, but few have moved the needle on increased sales, updating the organization, or customer experience. That’s making them vulnerable.
While the impulse of many companies we’ve seen is to invest across a whole set of digital initiatives, our research into the digital practices of outperforming companies finds that less is often more. It turns out that B2B leaders drive five times more revenue growth and 8 percent more shareholder returns by doing the following six things better than their peers:
- They commit to digital at a strategic level. Outperforming companies create bold, long-term digital strategies centered on customer needs. And they are far more likely to back those strategies with sustained high levels of investment. Digital is at the core of accomplishing annual strategic goals at the corporate level and developing the strategic planning process.
- They create consistent experiences online and off. While B2B customers are now demanding digital for key touchpoints, B2B digital leaders provide “smart” interactions across all channels. Customers are recognized from one channel to another. Their activities can be saved and then “remembered” when picked up again later, whether over the web, the call center, or in person with a company representative.
- They use data to enable and empower the sales force. Fewer than 20 percent of B2B companies believe they generate effective customer insights. Digital leaders not only have a finer grasp of high-value customer journeys, they use that data to give sales reps a leg up—arming them with predictive analytics such as next-product-to-buy recommendations, prospecting dashboards, and specialized apps that help reps navigate a crowded client purchasing environment.
- They connect processes end to end: Many B2B companies have done a good job automating the back office. But that’s often not integrated with the front end, leading to multiple customer handoffs between functions, long turnaround times for quotes, and missed delivery dates. Digital leaders, by contrast, use automated decision-support processes to connect finance, accounting, and enterprise resource-planning (ERP) systems with customer sales and order data to provide 360-degree service. They effectively tie presales activities into the pipeline process, which helps boost win rates and renewals.
- They anchor their culture in rapid innovation and execution. Top-performing B2B companies eschew traditional development processes for agile practices—rapid prototyping, minimal viable products (MVPs), and iteration—to transform speed to market. They use design-thinking principles and cross-disciplinary teams to accelerate innovation—often reducing development times from more than a year to a matter of weeks.
- They align their organizational structure to their digital aspirations. While many B2B companies are stymied by slow-moving processes, role confusion, and poor prioritization, B2B digital leaders are systematic about breaking down organizational siloes. Cross-functional teams of six to ten people are dedicated to specific products, segments, or customer-experience journeys. Performance metrics and incentives both track and reward impact against business goals rather than individual performance. They also invest in automation capabilities, such as pipeline dashboards and deal scoring, to speed up processes and decision making.
Digital transformations are complex. But by focusing on the six areas highlighted here, businesses can improve their performance and generate a compound annual growth rate (CAGR) five times greater than the rest of the field’s.
Christopher Angevine is an associate partner in our Atlanta office, Christoph Erbenich is a partner in our Berlin office, Candace Lun Plotkin is a senior expert in our Boston office, and Michael Viertler is a senior partner in our Munich office.