A digital strategy identifies the business objectives that can be enhanced through digital services. A good digital strategy dismisses unprofitable ideas, refines the best ones, focuses on the customer, paints the big picture, and outlines the path to the goal.

An appropriate set of digital services is an essential and effective means to achieve business objectives – even when the core of the business does not revolve online. Developing the entirety effectively and measurably requires a foundational digital strategy.

I refer to the following operational model as a digital strategy.

• Select the business objectives that can be supported with digital solutions.

• Evaluate what the construction of digital solutions would entail.

• Create a plan to execute the solutions.

I divide this operational model into three different phases.

Phase 1: Selecting Business Objectives and Building Hypotheses

A company can set endless objectives for its business. The role of the company strategy is to narrow this infinity down by eliminating 99% and naming the selected objectives.

The role of the digital strategy is to sift through these objectives to identify those that can be supported by digital services. It's easy to cast wishes, but realistically, a small or medium-sized business should not take more than three major objectives onto their table at once. Often, the correct number of objectives is one.

If there's an overwhelming flood of objectives coming from business management, a discussion about realism and prioritisation should take place before moving to the next phase.

Evaluating the suitability of objectives is crucial: it determines whether the outcome has any chance of success. I have found it helpful to consider each individual objective's presumed business impact and digital feasibility during evaluation.

I will provide examples of common objectives I often encounter.

1. Shortening sales cycles (often for certain products or services)
2. Increasing customer satisfaction
3. Succeeding in repeat sales (retention)
4. Generating sales-qualified leads

All of these can be assessed based on their business impact and digital feasibility. In practice, assessments are derived from interviews and workshops with business leaders and sales teams. The result is scored objectives placed into the quadrant shown below.

During the evaluation of objectives, the first hypotheses often arise regarding what kinds of digital solutions can support achieving the objectives and what the expected outcome is — in other words, what is to be achieved. Hypotheses must be developed to a level from which decisions about progress can be made.

The key to crafting a good hypothesis is experience. One must roughly know how much the construction of various digital services costs. What's the price of, say, an online shop, an order system, or a customer portal? One must also envision what expectations are reasonable and what are not. Will the end-user be willing to create an account for yet another portal, and what additional value should it provide to justify that effort?

Even a hypothesis based on experience and researched knowledge must undergo the crucial test of end-user evaluation. User tests and interviews should play a significant role when a company makes the final decision to implement a service.

A sound strategy leaves room for striking the big red cross over plans developed to the level of hypotheses. An essential part of success is ensuring that the wrong things are left undone.

Phase 2: Forming the Big Picture

When proceeding to the second phase, the company has prioritised its business objectives and selected those it can most effectively impact with digital solutions. Additionally, the company has described hypotheses for the expected outcomes and gained some understanding of the magnitude of investments and ongoing costs.

The next step is to integrate the developed services into the company's broader infrastructure. I recommend doing this by visualising the customer touchpoints with the company and the technologies required to fulfil these touchpoints.

Example of the big picture of a digital strategy for a fictional “Smart Home” technology manufacturer. It reveals the primary digital touchpoints for customers and resellers, the chosen social media platforms, and key influencers. The lower part of the diagram represents, at a broad level, the necessary systems, technologies, and their integrations with each other.

The digital big picture includes all of the company's own services and social media channels, where the company and customers interact. It is also an excellent place to visualise the desired movements of target groups between services. The big picture provides a snapshot of how the company hopes to be digitally present in its customer's daily life and purchasing decisions.

The top-level architecture diagram names the system components behind customer journeys. Its task is to convey what the planned customer experience requires to be realised. The diagram also maps out integrations between systems, and the document further elaborates what information is managed by different systems.

The architecture diagram uncovers potential structural flaws and overlaps in plans even before technical design begins and helps conceptualise costs. 

The architecture image of the digital strategy is further deepened and enriched when systems are acquired. It is advisable to sketch this image together with the organisation's ICT management.

Phase 3: Drawing the Development Roadmap

After choosing the objectives, designing hypotheses, and drawing the big picture, it's time to plan how to transition from the current state A to the documented target state B. I recommend drawing a development roadmap for this purpose – it's a tool that will turn the digital strategy into reality.

The roadmap can follow any effective presentation method that clearly illustrates the sequence and dependencies of development work. For simpler entities, I rely on the drawing capabilities of presentation tools, while for more complex ones, I use Gantt charts.

I recommend drawing the roadmap initially without any timeframes. The critical part is for the planner to consider how the next segment of the whole can be realised.

When drawing the roadmap, the group responsible for implementing the digital strategy may experience what I call an ERP lock: all development work seems stalled behind the ever-delayed ERP system upgrade. As a remedy, I recommend planning sub-entities and temporarily forgetting about the perpetually unfinished source systems. No business can afford to wait for eternity projects to finish!

Once the roadmap is complete, it's time to place it on a calendar and make preliminary evaluations of the durations of development projects. A suitable precision is half a year, and at most, a quarter.

A competent strategy always includes monitoring of results and progress. This need must be met by the roadmap by communicating the statuses of development projects. It's crucial to actively maintain this section once practical work begins.

After drawing the roadmap, a digital strategy rooted in business objectives, considering the environment and development resources, should be in hand, crowned by a concrete plan of actionable steps.

The Digital Strategy is Developed, but Work Doesn't Progress – What to Do?

Did you create a good strategy that still ended up gathering dust on the shelf and resurfaces during moments of self-loathing, while you try to piece together ad hoc ideas from the loudest “stakeholders” without a hint of a plan?

Fret not; it's possible to get back on track!

For added support for your digital strategy, I recommend implementing an enterprise-wide management model, enabling all stakeholders to return to the plan time and again and celebrate shared successes.