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Digital transformation progress made clear by the Digital Maturity Matrix

digital transformation
(Image credit: Image Credit: Chombosan / Shutterstock)

When it comes to digital transformation today’s customer-facing companies are somewhere on the digital transformation spectrum, some more advanced than others. But it’s important for companies to have a clear understanding of the progress they have made, and to see where they are ultimately headed. By using a Digital Maturity Matrix, conversations with peers, customers, board members and stakeholders will be easier, and the road ahead will be smoother.

The Digital Maturity Matrix has a Y axis on which experience maturity is plotted and an X axis on which technical maturity is plotted. 

The four pillars of experience maturity 

Experience maturity recognizes a company’s sophistication, consistency and connectedness when it comes to customer experiences. It focuses on organizational structure and the speed with which changes can be made to those experiences. Companies high on the experience maturity axis will offer differentiated, personalized and regular omnichannel experiences.

1) Devices and channels 

How many channels does an organization operate in? Retailers focused only on brick and mortar stores would be categorized as having limited experience maturity in this first pillar. Those that provide a destination-based website are providing the basic tier of a digital experience. As companies progress and optimize their mobile experience, this will accelerate them to intermediate maturity. Advanced use cases are those that have reached beyond these traditional channels and are experimenting in new channels, such as IoT, AR/VR and voice that connect and embed an organization with its customers’ daily lives.

2) Personalized & differentiated interactions

An organization closely connected with its customers is achieving personalized interaction. They can alter a customer’s experience, or provide relevant content, based on previous preferences they have exhibited. This is relevant in retail world and in social media and helps brands to be presented favorably with a personalized offering. Organizations that provide ‘limited personalization’ typically focus on a transactional relationship with customers. This evolves into ‘promotional interaction’ where the customer base is split into segments with targeted messaging. Beyond promotional interactions, ‘connected experiences’ involve messaging that is consistent for customers - a good connected experience for example would recommend additional products, items and services that compliment recent orders. A disconnected experience is an email with irrelevant offers for items already purchased. In the most sophisticated and advanced instances, brands and retailers provide a completely ‘personalized experience’ with offers, promotions and recommendations tailored to the individual.

A ‘differentiated’ experience can drive repeated habits and greater loyalty. However, the standard currently is to copy competitors, and truly differentiated experiences are rare, resulting in a “sea of sameness”.

Companies must invest in experiences and be bold. Personalization makes the consumer feel understood and builds greater loyalty, but differentiation is the ability to distinguish the business through experiences that are unique as well as purposeful. Combined they are a powerhouse. This pillar is driven by how deeply an organization understands its customers as individuals and then maps their needs, allowing it to provide them with timely and truly unique solutions. 

Reaching higher on this scale is enabled by adopting a Customer Data Platform (CDP) which can be integrated into the core components of the Commerce Experience Platform or Digital Experience Platform. That way data can be utilized to drive dynamic, hyper-personalized and differentiated experiences.

3) Speed and agility

Teams that are making changes annually or quarterly, or who are unable to iterate, react or experiment will be very limited in their ability to deliver sophisticated experiences. Monthly changes are better, but ideally an organization is free to deliver as and when it wants. 

The underlying factors that limit how quickly a company can iterate and deploy updates include organizational structure, process, and technology. In short, the faster they can iterate and make changes, the more mature the organization is. 

4) Organizational structure and behavior 

Digital Experience Platforms (DXPs) and Commerce Experience Platforms (CXPs) provide the technology to support organizational transformation but purchasing and integrating either of them will not help to achieve that transformation, without a shift in thinking and doing.

Businesses need to interconnect teams and move from silos to agile workflows with constant feedback loops to evaluate and respond to customer data so they can effectively harness the power of these platforms. DXPs and CXPs will help facilitate some of this change as they provide a centralized location for teams to collaborate - they have intuitive dashboards and machine-learning-driven insights and suggestions to stay aligned and deliver contextually relevant experiences. But that will not be enough. Whilst there are many well-defined and understood organizational structures such as hierarchical, flat, functional, divisional and team-based, it’s important to apply the context of the experience pillars as they can directly affect the delivery of consistent, hyper-personalized experiences across multiple channels at speed. 

Organizations with low experience maturity will likely have well-established but disconnected departments that typically operate independently from one another, ultimately creating disconnected shopping experiences. These departments create walls in companies which makes it harder to remain agile. More mature organizations may break out additional teams to run new channels and initiatives to try and manage the additional complexity they present. Companies high on the maturity scale have high degrees of autonomy and collaboration with well-established processes and workflows. 

The best approach is to document the jobs to be done, the tools used, and the ideal workflow to align the organizational structure to support what needs to be achieved to get the company to the next stage of digital maturity. It helps by identifying gaps and can create immediate improvement.

The four pillars of technical maturity 

Technical maturity is linked to and supports experience maturity. A poor architecture will limit, impede and hamstring an organization’s ability to deliver on the experience maturity axis. 

1) The on-premise monolith 

An organization operating with an on-premise monolith technical architecture in the 2020s is technically immature because it is simply not flexible enough. The orchestration framework is likely to be based on modules, feeds, and jobs, and the tech stack is probably JAVA or LAMP. The resources required to run this architecture involve full-stack developers accustomed to the proprietary monolithic stack but are expensive and come from a rare talent pool, notoriously difficult to recruit. 

Maintenance issues may exist as a company’s dedicated support team manages the upgrades to new versions and patches security issues. Business user tools are typically centralized and rigid, making it difficult to extend into new channels and devices without incurring huge cost, time and effort. 

2) The SaaS monolith

Many organizations are now on the cloud which reduces some maintenance headaches and support issues from the monolith. However, in the resultant SaaS monolith, the frontend and backend are typically still tied together through proprietary frameworks meaning the flexibility to solve complex experiences and workflows are restricted due to poor extensibility beyond limited plugins.

3) The hybrid architecture

Some forward-thinking organizations are transitioning from a monolithic approach to MACH (Microservices, API-first, Cloud-native, Headless). During this digital evolution they may begin to implement a headless architecture on top of the existing monolith or may have both in parallel. Organizations at this level of maturity will likely need a combination of developers to support their existing architecture, frontend developers to implement the experience “head” and solution architects to map their systems, integrations and migration path. At this stage teams may also be transitioning from a centralized tool to multiple best-in-class tools and interfaces. 

4) MACH architecture

Organizations at the forefront of technical maturity fully embrace change and have adopted a modern technology stack that follows pure MACH principles. At this stage, organizations have harnessed the power of best-of-breed technologies and have total control of their own technical destiny. There is little vendor lock-in, and the business is now able to rapidly make changes, additions and subtractions to its underlying architecture and service providers.

James Brooke, CEO, Amplience