In this issue, we begin with the strategy dimension. The next two issues will review people and technology dimensions, respectively. A digital-first strategy begins with a digital offering. A well-designed digital offering is enabled by digital systems supported by physical and analogue assets that support the execution of a digital-value loop. A powerful and sticky digital offering is deeply enmeshed with the user's on-going activities. To establish a digital offering, a firm must identify its "customers-as-users" and build a digital-value loop around the user's value-creating activities. To create digital offering with a value loop, firms embed digital sensing and control capabilities into their physical assets. This is in contrast with traditional firms that rely on physical assets as the primary means of value creation.
The success of digital-first strategy depends on the existence of a powerful digital value loop that builds on effective use of real-time predictive and prescriptive analytics at a granular user level. Such advanced data analytics capabilities help firms to generate insights on users' latent needs. Such insights are shared and used among all units to generate new digital offerings that create dynamic- and hyper-personalized recurring user engagement. This is in contrast with the traditional firms that use tools like online transaction processing (OLTP) and online analytical processing (OLAP) which provide historical analysis at a coarse market-level report.
Finally, a successful digital-first strategy must entail a clearly articulated growth plan leveraging its use of a digital-value loop. A digital-first strategy should serve as the blueprint of a company-wide coherent execution of digital activities. An effective company-wide digital-first strategy often entails its own digital platform ecosystem with clearly defined revenue models of digital offerings. This is in contrast to the traditional firms that rely entirely on physical offerings to generate revenue.