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How can companies use digital initiatives to create value?
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How can companies use digital initiatives to create value?

Four Ways Companies Can Create Value with Digital Initiatives

In this section, the speaker discusses four ways that companies can use digital initiatives to create value.

Reducing Costs

  • Digital initiatives can help reduce costs.
  • Predictive maintenance is an example of how sensors and advanced analytics can be used to understand when a machine needs maintenance, leading to more uptime for the factory and lower cost per unit.

Improving Customer Experience

  • Digital initiatives can improve customer experience.
  • Examples include mobile banking apps in banking and omni-channel retail experiences that allow customers to buy online or in-store and return items either way.

Better Decision Making

  • Digital initiatives can lead to better decision making.
  • Advanced analytics can be used to understand customers better, leading to improved marketing or product development. For example, consumer packaged goods companies use planograms generated by advanced analytics to increase sales and reduce time spent on generating them.

New Revenue Sources

  • Digital initiatives can create new revenue sources.
  • Farm equipment companies have found success providing additional services such as monitoring fields and helping farmers determine when to plant crops.

Importance of Digital Initiatives for Staying Competitive

  • Companies may need digital initiatives just to stay competitive.
  • If competitors are lowering costs through preventive maintenance or providing better customer service through mobile apps, not doing the same could result in lost business.
Video description

As our economy faces continued uncertainty, companies must create value in any way they can. For many, this means leveraging digital initiatives to improve existing business models. Tim Koller, lead author of VALUATION, explains the four ways in which digital initiatives can enable companies to build value today. Learn more about how your company can use digital at https://mck.co/36NJafV.