Click to read the original text for details In recent years, digital transformation has been a buzzword for many. As Jack Ma said: The next decade is the last decade for traditional enterprises to undergo digital transformation. If you don't prepare for change today, in ten years you will surely be a target of digital poverty alleviation. This year's pandemic has accelerated the pace of digital transformation from government agencies to small and medium enterprises. Some companies have immediately established digital transformation departments or assigned similar departments like innovation marketing to lead the effort. So, what are the key considerations among the many enterprises undergoing transformation? Today, let's discuss my views on the FMCG industry. -01- The fundamental of digital transformation is to solve business problems Many enterprises prioritize digital transformation by connecting management and internal digital tools and systems, but they quickly find that this path is simply unworkable. Because whether it's distributors or terminal outlets, the primary issue is survival; they care more about where customers are, not what to do when customers come. No matter what tools or methods, if they cannot help distributors and terminal outlets solve the ultimate problem of making money, they will never use any tools or methods, which directly leads to the failure of transformation. Digitalization is more about a change in operational mindset. Enterprises lead, distributors follow. The biggest resistance in actual operation is the change in distributors' mindset, especially for old distributors. First, let distributors feel the benefits of change through digitalization, and then the push will be fast. Where does this benefit come from? It needs to be prepared from two aspects: First, establish unified cognition: The foundation of digital transformation, in the final analysis, is the unity of cognition among all. Data tools or systems can be built in a very short time, but solving the coordination of cognition inside and outside the company, up and down, is a lasting process. So fundamentally, the success of digital transformation depends on whether everyone can reach a consensus in understanding. Second, guide through incentives, not forced transformation: For example, digital operations can set up tiered incentive systems like leaderboards, create star distributor digitalization, and subtly influence other distributors. In the early stage of digital operations, we must not seek completeness or speed. Start with partial actions and gradually expand. We encourage manufacturers to embrace the technological era for digital transformation, but also avoid campaign-style blind and hasty actions. Let some distributors get incentives first, thereby consolidating all distributors' confidence and consensus in digitalization. -02- The process of digital transformation should prioritize and sequence Digitalization is just a transformation, not a corporate strategy. It is a way or method to support and serve the realization of corporate strategy. So this process has priorities and sequences; we must focus on the present and solve current issues. 1. Focus on the present, practicality first: First, clearly think about where digitalization is most suitable for use today, tomorrow, and the day after. For example, if an enterprise has successfully created a model market, the urgent task now is to replicate the model market nationwide. At this time, the most critical role of digitalization is to build a digital model of the model market, including regional market population, disposable income, sales performance of different SKUs in different channel attributes, digital profiles of target consumers (age, income), etc. 2. Overall planning, step-by-step implementation: Aim at how to operate the business, and advance process goals in stages. For example, if a company's current main task is to attract distributors, the digital transformation steps would be: Step 1: Establish digital models of target distributors (product digitalization, channel digitalization, business scale digitalization, market sales capacity, and profit capacity digitalization, etc.); Step 2: Digitalization of demand (channel attribute digitalization, first product entry digitalization, SKU entry digitalization, etc.); Step 3: Digitalization of target consumer models; Step 4: Digitalization of consumer communication. Step 5: Digitalization of unavoidable situations in normal operations (large inventory age, production-sales coordination, etc.). 3. Priority levels, precise empowerment: Here I emphasize two dimensions: First, which key areas can help improve business quality? Second, which key angles can help increase organizational efficiency? These key areas that can help improve business quality and organizational efficiency should be prioritized for digital transformation. Others that are currently not urgent or critical should be postponed. People's energy is limited; do not start too many digital transformation tasks too quickly. Trying to grasp everything will inevitably lead to failure. 4. Clear goals, good planning: After everything is ready, have a phased process map. Everyone agrees on the goals, with the end point in the process as the target, and advance steadily. -03- Digital transformation should first focus on people, then on things Organizational change is the most powerful change. All enterprises talk about customer first, but how many have made bold adjustments in organizational structure? Digital transformation is the same. Enterprises say digitalization is important, but they let the IT department under the administrative department drive this work. Employees see the department responsible for maintaining computers and networks driving a change, so they naturally won't take it seriously. Therefore, first of all, traditional FMCG enterprises must realize that digital transformation must be a "top leader project." The primary condition for completing the transformation of digital talent organization is top-down, obtaining the support of the highest management. That is, the top leader must deeply understand that digital transformation is not a choice but a necessary path, a collective transformation and sublimation of all enterprise personnel. Goals must be clear, beliefs firm, so that setbacks during transformation won't deviate from the goals. Secondly, there must be a clear digital transformation framework, and add organizational structure to the framework. Finally, prioritize professional talent. The current situation is that the definition of digital talent is very broad and diverse. There is still a lack of a standard system for talent cultivation, supply, delivery, and evaluation to meet the needs of social development. The first thing for enterprises is to cultivate matching talent based on the most urgent needs for digital empowerment and the current situation of the enterprise. The challenges faced mainly include:

  1. The level of practitioners in the digital industry is uneven, and qualified digital talent is scarce. Additionally, some emerging digital talents may give up due to traditional employment concepts, so both internal cultivation and external recruitment face great pressure.
  2. Digital knowledge and technology update and iterate too quickly, and talent skill development plans cannot keep up with changes. Therefore, the skill improvement system must be continuously improved. This is not something that a department like HR can do alone; it requires the cooperation of all departments.
  3. In the digital field, especially digital marketing, employee turnover is high, and knowledge assets cannot be accumulated. So professional talent must be given both "emotional" and "bread" (i.e., emotional satisfaction and material rewards).
  4. The faster the forces hindering digital transformation are removed, the better. When promoting digital change, there will definitely be many middle and senior managers who passively resist change and will be dismissed. If employees are divided into four quadrants based on performance and cultural identity, the most dangerous are those with high performance and low cultural identity. They are termites that eat away at the enterprise building. As leaders, you must identify these people early and dare to let them leave. Final words: Digital transformation in the FMCG industry is a coordinated change in business, organization, operational processes, and IT technology. Therefore, it is necessary to fully coordinate all related resources to ensure effective implementation of the transformation. It is not about setting up a few IT systems or hyping a few new concepts, but using digital technology for strategic adjustment and business reshaping. It is about being prepared for danger in times of peace, a prerequisite for sustainable development, a driving force for self-improvement, and a process of transformation like a butterfly emerging from a cocoon. Just like a sentence from Teacher Fang Gang's WeChat Moments: Currently, digital transformation is in full swing, not gradual change, but comprehensive replacement! With digitalization as armor, and internet giant platform data empowerment as a cheat code... The essence of business is information asymmetry. Because of digitalization, I see more clearly, faster, and farther than you... I have already seen your cards, but you don't know where I am. This game is destined to be unplayable...