Unleash Scale-Scope for Competitive Advantage
Connecting User Experience, Customer Experience, Digital Transformation and Innovation with Scale-Scope Strategic Lens.
In today’s business world, four important concepts — user experience, customer experience, digital transformation and innovation — are popular. Each concept has its own distinct characteristics, but they are connected. We’ll use Scale-Scope lenses to navigate these connections. Before we dive in, let’s refresh our understanding of the four concepts with their definitions.
User experience as “a person’s perceptions and responses that result from the use or anticipated use of a product, system or service.” (International Standardization Organization, 2009).
Customer experience as “a multidimensional construct focusing on a customer’s cognitive, emotional, behavioral, sensorial and social responses to a firm’s offerings during the customer’s entire purchase journey.” (Katherine N. Lemon and Peter C. Verhoef, Journal of Marketing, 2016).
Digital transformation is “the combined effects of several digital innovations bringing about novel actors (and actor constellations), structures, practices, values, and beliefs that change, threaten, replace, or complement existing rules of the game within organizations, ecosystems, industries, or fields.” (Bob Hinings et al., Information and Organization, 2018)
Innovation is “a new or improved product or business process (or combination thereof) that differs significantly from the firm's previous products or business processes and that has been introduced on the market or brought into use by the firm.” (Organisation for Economic Co-operation and Development, 2018).
Scale and Scope dimensions drive the interconnectedness of the four concepts.
Scale refers to frame of change, either evolutionary iterative or revolutionary disruptive. Iterative implies a gradual process of improvement or development, suggesting incremental changes over time. Disruptive suggests a more radical shift, often involving a transformative change that can disrupt existing paradigms or systems.
Scope refers to frame of focus, either narrow and product-centric or broad and process-oriented. The term Product encompasses key aspects like its design, incorporating user-friendly aesthetics; features, offering unique functionalities; quality, ensuring reliability and performance; and market positioning, strategically placing it within the competitive landscape. In contrast, Process implies a focus on the methods, ways of working and workflows involved in creating, improving or delivering a product.
Each concept occupies a quadrant in the Scale-Scope 2x2 grid, based on its characteristics:
User Experience The focus is on the Product and the essence of change is Iterative, a deliberate evolution toward achieving a product-market fit. The emphasis is on creating useful product with usable interfaces to nudge users toward intended business outcomes. This places user experience at the core, not only as a design principle but as a strategic tool for enabling users growth.
Customer Experience The focus is on the Process and change is Iterative, progressing towards an omnichannel, seamless customer journey. Customer Experience tends to be more expansive and holistic, encompassing end-to-end processes—from customer awareness of a product to exploring options, making selection and purchase decisions and extending to post-purchase and repeat visits. It analyzes customers in disparate contexts and continuously devises and optimizes ways to ensure a seamless experience. This results in happy customers, fostering loyalty and organic growth.
Digital Transformation Digital Transformation is an organizational shift driven by technology. The primary focus is on transforming organizational Processes, and this change is inherently Disruptive. It alters the status quo and can significantly impact various facets, including culture, mindset, power structures, working methods and skill sets. Organizational adoption of new technologies, such as blockchain or AI, is inherently disruptive and can reshape existing revenue-generation structures. Desired outcomes include greater productivity, creation of new businesses and enhancement of competitiveness and differentiation.
Innovation is inherently Product-focused, involving the creation and delivery of something significantly new to the marketplace. This process is inherently Disruptive to the status quo and can take various forms, such as defining a new niche (as seen with Uber compared to traditional taxis or Airbnb compared to hotels), achieving a 10x improvement over existing solutions (such as, Google Search vs Alta Vista, Hotbot, etc. and ChatGPT vs Google Search), or redefining the product paradigm (as exemplified by the iPhone versus BlackBerry, Nokia, Windows Phone, etc.). According to a study, startups demonstrate a higher tendency to bring high-impact innovations to the market compared to established incumbent firms. Startups benefit from a lack of technological and mindset legacies, providing more freedom to pivot rapidly in pursuit of continuous product-market fit, despite potential challenges in distribution prowess. In contrast, established corporations face the weight of legacy—technological, processes, cultural and mindset-related.
The Scale-Scope serve to connect the four popular concepts - user experience, customer experience, digital transformation and innovation - and illuminate their differences and similarities. Each concept represents a way of seeing and, equally important, a way of not seeing, the essence of value creation and competition in today’s technology-driven marketplace.
Photo by Google DeepMind