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Saving Businesses From Mass Extinction Through Digital Transformation

Saving businesses from mass extinction through digital transformation

“Mass-extinction events don’t just happen for no reason. In the current extinction event, the causal factor is digital transformation.”


Digital transformation is everywhere these days. Some people talk about it as another overhyped buzzword saturating the C suite, while others say it’s the key to the future.

Despite the hype, digital transformation truly is critical for businesses to understand and solve for, it’s the best way to survive the mass extinction event happening in business today.

For the past 10 years, GoKart Labs has defined digital transformation as the act of becoming a digital business in order to better meet changing consumer expectations. Why should this matter to you?

Why digital transformation is critical for businesses.

For better or worse, people spend most of their day soaking in blue light from a screen. According to some studies, an average day of digital consumption can clock in at over 9 hours. If your business can’t function in this digital ecosystem, then it can’t connect with consumers and it will eventually struggle.

The struggle to connect with consumers digitally is even taking down the apex predators of the business world. A study by McKinsey showed that since 2000, fifty percent of Fortune 500 companies have disappeared and the number is increasing. McKinsey declared it a mass extinction event caused by an inability to adapt to digital business.

Both new and established businesses are becoming aware of this threat and have started to embrace digital. Currently, there are two camps for embracing digital transformation as a company:

  1. Born digital. Brands like Netflix started as a digital platform. Digital is in their DNA, and this has given them a massive opportunity for scalability and flexibility in meeting customer’s digital expectations from day one.
  2. Embrace digital transformation. The established Fortune 500 brands that are thriving in the digital world have embraced digital transformation and changed how they operate. Juxtaposing Kodak and Fuji illustrates the outcome. Kodak decided to double down on its traditional film-based business model. Fuji embraced becoming a digital business and radically adapted the entirety of their business. The results? Today Kodak is bankrupt while Fuji pulled in $1.6 billion in profits in 2017.

Digital is coming for every industry, like it or not. As business leaders, it’s up to us to decide why and how we’ll adapt to changing customer expectations. To survive the mass extinction event, your business needs to be in one camp or the other.

Failed businesses hurt people and the world around us.

Business drives society. A change as dramatic as digital transformation reaching across category, industry, and geography could have massive societal repercussions. We’re concerned about business and the people they serve – we exist to help new companies prosper and great companies endure.

Said more simply, we exist to help business drive positive impact in this new digital world.

We want to give new companies a different way to solve problems, find traction, and make an impact. GoKart Labs wants to prevent established companies that have built a solid reputation and had a positive impact on the world from falling off the face of the earth. We want to help prevent job loss and help people reskill themselves to match future needs.

GoKart Labs uses digital transformation as a tool for achieving positive economic growth and social change while avoiding waste.

What works and why?

“Technology is a big part of digital transformation, but the other 4 human components is where it’s really hard. Which is saying a lot, because the technology side isn’t all that easy.”

– Chris DuFresne, Director Information Services, Digital Consumer and Employee Experience at Allina Health

Forrester has studied thousands of organizations of all shapes and sizes, looking for common attributes that drive successful transformations. They’ve identified 5 factors that must change for successful digital transformation:

  • Technology
  • Structure
  • Culture
  • Metrics
  • Talent

This means that, while important, replatforming tech stacks, migrating to the cloud, building new mobile platforms aren’t successful digital transformations – they’re a piece. Successful transformation also requires making adjustments to your structure, culture, metrics, and talent.

This highlights an important point: Changing the technology you use won’t change how you do business. If you don’t change how you do business, then you aren’t embracing digital transformation.

If you only ate grapefruit for a week, you’d lose weight. But, would you that help you embrace and maintain a healthy lifestyle? No. Putting tech first creates the same issue. You’ll experience a short-term gain, but it won’t solve the underlying human element of digital transformation.

Businesses fail at digital transformation for many reasons. Most often because they don’t focus on the human side of change. To succeed, they need to either learn quickly or lean on the right partner.

How GoKart Labs helps brands embrace digital.

Digital transformation is a team sport.

We’ve lived and breathed digital transformation for the past 10 years. We’ve built “born digital” companies from the ground up, and we’ve worked shoulder to shoulder as multi-billion dollar organizations execute massive change. This experience has shaped our point of view, but more importantly our methodologies to help drive successful transformation.

The first is “outside-in” transformation – most often in the form of building and scaling new digital-first company. We’ve honed this approach over 9 years, starting in 2009, when GoKart Labs developed an online learning business called Sophia. We partnered with Capella Education from day one, but key to the success was our “outside-in” approach. This startup was incubated in our office, born digital, and challenged the high-cost degree model that Capella operated in for the last 15 years.

Having the company built and run within GoKart Labs’ walls allowed Sophia to grow without cannibalizing Capella Education’s main line of business. We had the freedom to adapt/react to evolving customer needs allowing us to continually shape the product, service, and business at an extremely fast pace.

As a result, we built a successful business that Capella Education acquired and integrated into its business with the support of GoKart Labs. This allowed for digital transformation to become part of Capella Education’s core business once a mature solution was proven.

The second is “inside-out” transformation — helping an established business transform their technology, structure, metrics, talent, and culture from the inside out. In 2016, our long-time client, Allina Health, asked us to help them reimagine their total customer experience – looking for the right opportunities to inject or improve new digital experiences for patients, employees, and partners.

This transformation didn’t happen overnight. But, with a clear vision on what Allina wanted to affect, and an optimistic/human-centered design approach, we were able to make significant improvements to the entirety of Allina’s experiences.

We started with the people side of change; focusing on how we worked together, approached problem-solving, the process we used with Allina to drive new solutions, and new ways of thinking. Through 20+ design sprints, hundreds of tests with consumers, re-platforming a ton of technology, and a transition from waterfall to agile we’ve helped Allina transform both their digital experiences and the people and processes used to create them.

How we can help you.

The age of traditional business has ended. Which businesses will survive? Those who are born or transform into digital businesses.

GoKart Labs goes beyond the technologies that make digital transformation possible. We evoke human change and mindset shifts to address the true drivers of digital transformation.

Start a conversation to discuss how your company can embrace digital. Take this assessment to better understand if your organization is prepared for digital transformation.

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