Digital transformation and OBMs: why outcome is the new output in 2023

  • Insights
  • Digital transformation

If the past decade has shown anything, it is that we live in an increasingly unpredictable world where technology not only fuels business growth but also anchors us to cumbersome processes and technical debt from past projects.

At MMT, we're frequently hearing from clients that they need to react more quickly to change but are still locked into a large digital transformation project which is stopping them coping with new challenges. That friction between long-term stability and short-term need leads to missed opportunities to further strengthen or grow an audience and brand relationship.

Finding balance is more important than ever, and metrics that successfully direct large projects and smaller tactical product builds towards the same goal are essential. Which is why at MMT we talk almost exclusively to client partners about outcomes, not outputs.

When it comes to shaping a resilient digital strategy in the rapidly changing world of technology, we believe that organisations that have morphed towards outcome-based business models (OBMs) work much better in an increasingly cash-strapped and competitive marketplace because that outcome helps prioritise what they do, when, and how.

Why OBMs prioritise outcome over output

Output is just another feature or function in a list of deliverables (what you want someone to do), whereas an outcome is a constant strategic mindset focused much more on human need than human action (how you want someone to feel). It means that no matter how big or small the delivery, you've always got something softer than a KPI to measure success against and that can also be used to start to redirect effort inside a larger digital transformation programme that might be slowing the ship down.

Let me go with a simple example to help make the point.

You need to buy a new family car. At the car dealership, you test drive some options and decide on the vehicle that best suits your family's needs. Three months later, your car was delivered precisely to your requested specification. So far, so good.

If I were to ask many businesses what the outcome of this transaction was, some would answer that the outcome is the unit sale of the car and the revenue it brought to the brand, and they would be only partially correct.

But the better outcome should be a delighted buyer and an even happier family who are now the owners of a sustainable, comfortable, cost-efficient, and reliable new ride even with the long wait to receive it. The car itself is just the output provided by the dealership. If the vehicle had not been what they ordered, or if the dealership had been late delivering it, then the desired outcome—a delighted buyer and a happy family—would, in all probability, not have been achieved to the same extent.

In this example, I also highlighted that the car delivery took months to arrive, so consistent, transparent communication is also critical across that waiting period for the desired outcome to be achieved. Getting the tools in place for great relationship-building and mind-management must be factored into the journey, its what consumers remember you for, not the vehicle that you originally agreed to buy.

Customers have always demanded solutions to problems, not shiny technology or services; we lost sight of that when technology gave us so many options and new pieces of glass to click on and fiddle with. Consumerism also fogged the lens, and businesses focused heavily on unit sales, and projects that delivered outputs, but as Theodore Levitt once wrote: "People don't want a quarter-inch drill. They want a quarter-inch hole."

We're all in the hole-creation trade.

How do you become an OBM business?

For organisations to become outcome-driven, the right level of alignment must occur vertically from senior executives all the way across to the teams and departments that deliver the final products. In omnichannel businesses, that also means aligning the goals with customer-facing staff in shops, online support staff, and across to the managers of e-commerce apps and platforms and beyond. They all need to be pulling towards those same outcomes or risk, confusing the audience or offering conflicting services because of siloed thinking.

At MMT, we work at the executive level to help the C-suite understand that these often frightening changes don't need to be wholesale. Small tactical steps often drive the most significant changes over time. You can't stop delivering specific types of programmes in Waterfall ways; there's too much risk involved. But there will always be minor incremental improvements that you can make on some of your delivery, and within cross-departmental teams if you are outcome-focused, not output-focused.

Changing the culture to a product-orientated, outcome-focused one takes time and patience because even how work is staffed changes considerably. A single core team should own product delivery through to go-live and support, so the integrity of those outcomes can be championed and owned at every stage. That is a very empowering model for staff because being trusted to deliver updates more often, focusing less on the ROI and more on human satisfaction, creates a level of understanding and commitment to a product that hasn't traditionally happened.

If you are interested in hearing more about ways of leading your organisation in a more outcome-focused way, we have a suite of frameworks and approaches that we use to start you on the journey or refine the journey you are already on. Either way a great outcome for us would be having a conversation with like-minded people solving some interesting challenges, so get in touch with us on