Digitalization: Hype vs Reality - When Data Trumps Business

The Digital Dream: When Data Obsession Overshadows Business

The buzzword "digitalization" has been dominating business conversations for years. Riding this wave, countless companies embarked on digital transformation journeys. Experts churned out catchy slogans like "business process automation, online workflow, asset digitization, data intelligence," promising a path to corporate success.

But is reality truly mirroring these lofty ambitions?

Recently, I came across a video by Song Xing, a prominent figure in the digital marketing sphere. He painted a bleak picture of the current state of the industry: fewer companies are actively hiring for digital marketing roles while the number of job seekers seeking such positions has increased significantly.

This raises a crucial question: Is digitalization losing its allure?

Based on my experiences across various sectors – both traditional and tech-driven, virtual and physical economies – I believe that digitalization itself isn't inherently flawed. The problem lies in the misguided implementation of digital strategies.

The Pitfalls of Data-Centricity:

One glaring issue is the excessive focus on data without grounding it in core business needs. Take the example of "intelligent driving score" I developed for a new car manufacturer. While mimicking competitor systems, this product ultimately failed to resonate with users. It prioritized data points over truly addressing the user's need for safe and reliable assisted driving features.

The obsession with metrics led to a situation where we were chasing vanity numbers instead of focusing on the essential functionalities that would have driven real value. Data can be misleading; it often obscures the true drivers of success which lie beyond quantifiable metrics.

Ineffective KPIs: The Silent Spiral:

Another trap is setting misguided "north star" metrics – key performance indicators that steer decision-making.

During Shanghai's lockdown in 2021, I witnessed a concerning example. The focus on achieving specific infection control targets led to the prioritization of data points over genuine public health concerns. This distorted view resulted in ineffective strategies and ultimately prolonged the crisis.

Data as a Tool for Internal Power Plays:

Digitalization can also become a weapon in internal power struggles. I encountered this firsthand when working with a third-party data consultancy firm.

A client, driven by internal power dynamics, used our services to discredit existing teams within their organization. Digital audits were manipulated to highlight perceived weaknesses and justify restructuring, ultimately serving as a tool for personal gain rather than genuine organizational improvement.

Reclaiming the Value of Digitalization:

While these examples expose the potential pitfalls of digital transformation, it's crucial to remember that data and technology hold immense value when applied responsibly.

We must ensure that:

• Business objectives remain at the core of every digital strategy. Data should serve to enhance business outcomes, not become an end in itself.
• Metrics are carefully chosen and aligned with real-world impact. Vanity metrics can be misleading; focus on KPIs that reflect tangible progress towards organizational goals.
• Ethical considerations guide data collection and usage. Transparency and accountability are essential to prevent data manipulation for personal gain or internal power struggles.

Let us strive for a future where digitalization empowers businesses, fosters innovation, and drives positive change – not a dream fueled by misplaced priorities and unethical practices.