Digital transformation. You probably hear this phrase all the time but what exactly does it mean? Is it just an empty industry buzzword?

Digital transformation has a specific definition. On today’s show, Anurag Agrawal, the founder and CEO of analyst firm Techaisle, explains the true meaning of digital transformation and how it shouldn’t be confused with digitization or digitalization.

Techaisle specializes in researching small and midsize businesses (SMBs) for the channel, so he has some great insights and numbers to share. But before that, Richard Tubb and Karl Palachuk take a look at what’s going on in the world through an MSP lens.

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What’s Going On

[02:02] Richard just attended CMA Live from the Content Marketing Academy.

[02:49] Most of the speakers were talking about video. There were some interesting statistics about how video and mobile video attract people.

[03:23] Brian Fanzo brought along a new pair of Snapchat Spectacles. These are cool-looking sunglasses with embedded video devices. You can record whatever you see.

[04:32] Most MSPs don’t do a lot of video. Could Spectacles be a cool new way for them to do so?

[04:45] They would be good for how-to videos. They could even be used when putting together a deal for a prospect package.

[05:37] They’re currently targeted to consumers but Richard says they will move into business eventually—these technologies alway do.

[06:56] Richard also spent time with Nigel Moore from the Tech Tribe.

[07:09] Nigel is using Bonjoro to send personalized welcome messages to MSPs who join his community.

[07:25] Why aren’t we using video more often when it’s so easy to use and garners such great results?

[08:16] Marriott is planning on using Alexa as a butler in every hotel room. It’s being sold as an opportunity for better service.

[08:47] Having Alexa on in your room at all times can be a privacy issue.

[09:16] Karl has heard from people that things they’ve talked about are showing up as as advertisements.

[10:06] Let’s do a listener experiment and see if this is really true. Email your results to Auvik.

[10:39] Say the words Karl gives you out loud but don’t put them into a browser or search window. The experiment is to see who’s listening.

[11:48] Richard has a theory that people seeing ads for things they’ve been talking about is simply RAS – our brain’s reticular activation system.

Interview with Anurag Agrawal – What’s the Deal With Digital Transformation

Anurag Agrawal Techaisle Frankly MSP podcast interview
Anurag Agrawal, Techaisle

[17:55] Anurag Agrawal started out as a research analyst for IDC where he launched their quarterly tracker research program. Then he headed worldwide research at Gartner before leaving to form Techaisle, his own analyst firm, in 2008.

[18:23] In episode 12 of Frankly MSP, Josh Weiss mentions Techaisle as a great source for MSPs.

[19:18] Anurag defines digital transformation as the use and integration of digital business processes across the entire enterprise. Digitization is the conversion of manual paper records, data, or processes into a digital format. Digitalization is the business use of data generated through digitization.

[21:23] A surprising number of small and mid-sized businesses are focus on digital transformation. 82% of SMBs have initiated some form of digital transformation.

[22:31] 42% of these SMBs believe the internet and digital technologies impact every aspect of their business and must become a core part of organizational strategy. This opens up huge opportunities for MSPs.

[23:55] The drivers for digital transformation are operational efficiency, employee empowerment, customer intimacy, and innovation.

[24:27] Inhibitors include lack of skills, reluctance to change, and lack of capital investment budget. MSPs need to assess what’s driving their prospects and what’s inhibiting them to package and present digital transformation in a way that appeals.

[25:35] Digital transformation also demands that MSP channel partners develop extensive new capabilities.

[26:09] Techaisle has a free white paper on what MSPs need to do to position themselves for success delivering digital transformation. It covers seven key points are:

  1. Build, test, and evolve road maps that connect the technology investments with the benefits of digital transformation.
  2. Start working with SMB customers to develop expertise in positioning digital transformation effectively to both business and IT.
  3. Invest in the skills needed to deploy, connect, and optimize technologies that are important to the transformation roadmap.
  4. Invest in relationships with vendors that are at the forefront of digital transformation.
  5. Develop an end to end capability by combining access to key vendors with access to ecosystem partners who can provide complementary skills.
  6. Develop customer KPIs to measure the business outcomes and benefits.
  7. Develop an outcome-based revenue model.

[29:25] MSPs should understand where their customers are and where they are best positioned in digitization, digitalization, or digital transformation.

[30:45] It’s important for MSPs to develop their own strengths, so that they can have a meaningful impact for their customers.

[31:25] There wasn’t a lot of traction in the MSP market around digital transformation but it has really accelerated in 2018. 2018 may be a tipping point.

[33:52] Outcome-based revenue is a long-term objective contingent on developing and testing KPIs.

What’s Going On

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