The Wall Street Journal recently reported that Lowe’s will be shifting its focus and investments towards creating more custom software, particularly on its e-commerce platform. As the Journal states:
“Lowe’s Co s. is taking more of a do-it-yourself approach to software development, retooling its e-commerce platform to boost sales….the hope is to better personalize, through custom code, the online shopping experience for a range of customers, from professional contractors to weekend DIYers.”
Lowe’s focus on creating highly personalized experiences is something that I see many organizations concentrating on. The importance of technology today, in particular how it represents the key interaction point between a company and its customers, means that simply using existing packaged software means you are providing a standard, underwhelming digital experience.
Every business today is investing heavily in technology – the challenge therefore is how to stand out from the competition and create a digital experience beyond that which your competition is able to do. And you can only build a differentiated product by taking more control, as Lowe’s has decided to do.
Executives are looking to use state-of-the-art technology, everything from augmented reality, chatbots, to machine learning, to create a customer experience that differentiates their business. But at the same time, realize that they need to take a highly customized approach in order to meet the personal needs of their customers.
Lowe’s is taking a mature and sophisticated approach. They state that they aim to build 80% of its application portfolio in-house, to enable them to create more custom experiences for their customers. However, for standard internal business processes which provide no differentiation, they will continue to purchase packaged software.
Today, the widespread availability of SDK’s, frameworks and open source software means building your own software products, while still highly complex, can be done faster than ever before. Lowe’s has recognized that building their own solution means they will be able to incorporate the latest technologies and methodologies into what they want to be a competitive differentiator for their organization.
Of course this strategy has its challenges and dangers. It’s one thing for a digitally native company to write their own software, it’s a very different one for a traditional enterprise to be able to apply and practice the right methodologies as well as to apply and leverage the latest or best technical solutions to achieve their digital aspirations.
This is where smart companies understand that building your own solution does not mean going at it alone and thus build strategic partnerships with consulting firms, software engineering companies as well as technology providers that allow them to minimize risks, get to market sooner, with better quality and potentially at a reduced cost while still offering a differentiated experience to their customers.
Before following in the footsteps of Lowe’s it’s worth taking a step back to see how such a strategy can be applied to your organization. And it all starts with creating a digital vision for your organization. How can this vision help you achieve rapid growth and become a leader in your industry.
As Charlene Li points out in her book, The Disruptive Mindset, its rarely technology alone that creates disruption and growth in an industry, but rather “the application of existing technologies in new ways that enable it”. This has been the case for companies from Uber to Netflix.
In the digital world, your top executives need to own your digital experience. Increasingly this means building software and applications to deliver a unique experience. While this involves taking more control, it will still be necessary to work with partners, from agile development specialists to cloud service providers.
For example, in much the same way as what Lowe’s is doing, banks and financial services firms are having to learn that they can no longer manage and control the whole tech stack, but need to take a more sophisticated approach to managing their technology environment in order to create compelling digital experiences for ever more demanding customers.
Remember, the fact that you have decided to have more control and ownership should not mean that you don’t leverage some third party technologies, components or software development companies that will help you realize your vision faster, with proven practices and technologies.
This article was originally published by Forbes
January 08 / 2020
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Digital technology enables organizations to boost productivity and better engage with customers. However, many technology initiatives continue to see cost overrun, damaging the bottom line and undermining the value...Read post