Digital Strategy Framework V 8-2

Customer and
Growth
Digital Strategy
Framework
Version 0.8 – ISSUED FOR REVIEW
2013-14
Contents
1) Introduction – Digital at KPMG
2) Digital Strategy Framework - Overview
3) Framework Element Detail
4) Case Studies
5) Engagement design variations
6) Work Product Examples
© 2013 KPMG LLP, a Delaware limited liability partnership and the U.S. member firm of the KPMG network of independent member firms affiliated with KPMG International Cooperative ("KPMG International"), a 2
Swiss entity. All rights reserved.
FOR INTERNAL US&ME ONLY
Digital at KPMG
Introduction
The Customer & Growth Digital Strategy Approach sets out a method for conducting Digital
Strategy engagements. It is intended to be both a ‘how to’ for practitioners as well as a
proposition for clients.
The Approach has been led by the UK MC Customer & Growth team but with consultation and
collaboration from the Strategy Group in the UK and MC colleagues in Australia and the US.
This document has been prepared in response to three main drivers:
■ Global client demand for a KPMG Digital Strategy Proposition
■ A recognition that KPMG has built a solid, global track record of Digital Strategy engagements
that is being under-leveraged
■ The belief that KPMG has a distinctive view point on Digital Strategy and an approach that we
believe is more directly focused on both adding economic value to our clients and setting
them up to the innate uncertainties and flux of our Digital world
Version 1.0 of this document will be described as such for a reason – it really represents the
starting line for this proposition and we very much hope and intend to evolve, enrich and
strengthen this approach as a core proposition within KPMG’s global Customer and Growth
capability.
How to use this document
 As collateral for business development and sales activities
 As collateral within proposals
 As a discussion tool with clients
As an accelerator when designing Digital Strategy engagements – no need to reinvent

 the wheel
 As a source of ‘how to’ advice for practitioners delivering a Digital Strategy engagement
As a basis for Mobile or Social Media strategy engagements – the high level method
 should be just as applicable
As a set of modules that you can re-configure to match the specific client or market
 opportunity – some example ‘paths’ using a sub-set of the modules are provided in
this pack
 As a tool to help appropriately size and price Digital Strategy engagements
How NOT to use this document
 As a prescriptive, rigid, one size-fits-all method
 Only if you are a ‘Strategy Consultant’
In isolation from other methods and approaches such as Customer and Cost Insight,
 Target Operating Model or Lean Operations
Digital Strategy Framework
Phase 2 –
Phase
Phase 1 – “Telling
1 – “Telling the story”
the story” Phase 2 –“Planning
“Planningthe
thejourney”
journey”
Direction Setting Customer Business Design Execution Planning

Propositions
Digital Strategy
Objectives,
Principles &
Constraints
Digital
Strategic Customer Technology
Context Research Strategy
Digital Digital
Capability Strategic
Digital Vision Model Roadmap
Strategy
Current State Customer and Operating Execution
and Digital Staff Model Programme
Maturity Proposition Impacts Design
Culture &
Behavioural Case for
Change Mgt Change
Change management
Strategic Context
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
Definition
The Strategic Context describes the positioning of Typically contains:
the organisation within it’s industry or sector(s) and
■ Digital/Technology Trends and Forecast
describes the likely impact of various external
factors. ■ Market Trends and Industry Dynamics
Within a Digital Strategy engagement, these
factors are focused on the impact of specifically ■ Competitor Analysis
digital, technological and related social or
economic changes but do include broader industry ■ Channel shift trends
dynamics as well. This is because the relative
impact and nature of digital disruption is different in ■ Corporate/business strategic context
each industry.
Defining the strategic context (cont.)
Scan and map Derive key threats

Prioritise impact Prioritise
emerging digital and opportunities
using profit pool data mitigation responses
players and innovations (including themes)
nt nt
r ge r ge
U U
Time line […] […] […]
■ Define framework and ■ Identify overarching themes ■ Build quantification model to ■ Define potential interventions
conduct scan of emerging across players and business size potential impact of to mitigate risks, e.g.,
business models models selected themes – Re-allocation of
Activities
■ Review previous work related ■ Link themes to specific ■ Assess impact over short- investment
products and revenue drivers term, medium-term and long-
to digital and current beliefs term horizons – Small ticket acquisition
about digital – Partnerships/equity stakes
■ Identify profit lines/areas
■ Interview key stakeholders facing significant threats or ■ Take into account balance
and experts opportunities sheet impact, costs, and risk
>100 10-20 8-10 2-3

Players and Key threats and Prioritised themes Mitigating responses/
innovations mapped opportunities developed quantified and actions developed
beliefs challenged
Defining the strategic context
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
Case study: ■ KPMG was engaged to work with UK Banking Group (2)’s Digital
Strategy Team to prioritise the Bank’s mitigating responses to the
combined threats and opportunities to their business
■ Combined five year threats and Opportunities were quantified as
greater than USD4 billion over 5 years
UK Banking ■ KPMG delivered analysis, business consultation and the production
Group (2) of Divisional Roadmaps to put in place a multi million pound
investment in response
Scan and
map emerging
digital players
and innovations
Inputs?
Scan and ■ Client documents

map emerging ■ Stakeholder interviews
digital players
and innovations ■ KPMG datasets/views/internal sources
■ Gartner/Forrester/other research
Outputs?
■ Typically around 100 innovations and players are

mapped
■ Usually excel/PowerPoint table categorising threats

across size/type/business area under threat/with
opportunity
What?
Derive key threats ■ Identify overarching themes across players

and opportunities and business models
(including themes)
■ Link themes to specific products and
revenue drivers
How?
■ Workshop/stakeholder agreement to categorise

threats and opportunities based on Innovations/
other players/technology trends
■ May link to agreed and consistent set from
KPMG Strategy
Inputs?
■ Outputs from innovation scan

Derive key threats
■ Detailed knowledge of client business (i.e. what can be
and opportunities
threatened, what may be an opportunity)
(including themes)
■ KPMG Strategy team views
■ Client stallholder views
■ Workshop
Outputs?
■ Set of 10-20 key threats (for a large business)

■ Often T&O’s are inverses of each other –
‘do nothing/do the best thing’ relationship
■ Threat/Opportunity description with linked
innovator/competitors identified
What?
■ Build quantification model to size potential impact of

Prioritise impact selected themes
■ Assess impact over short term, medium term and long-term
using profit
horizons
pool data ■ Identify profit lines/areas facing significant threats or
opportunities
How?
■ Build financial analysis model built around:

nt – Threats and opps
r ge
U – Client’s financial and sales data
– Assumptions around likelihood
■ Ensure model has short, medium and long term
dimensions across ‘likely’ and ‘extreme scenarios
■ Run challenge session internally and with eh client to
agree ranges and assumptions
Inputs?
■ Client data including future sales and cost plan

Prioritise impact
■ Market sizing's/views from KPMG/external
using profit
data sources
pool data
■ Multiple assumptions – including for example
demographics, competitor reaction and
channel sift
Outputs?
nt
r ge
U
■ 8-10 prioritised themes developed, quantified and

challenged
What?
■ Define potential interventions to mitigate risks,

e.g.,
Prioritise – Re-allocation of investment
mitigation – Small ticket acquisition
responses – Partnerships/equity stakes
■ Take into account balance sheet impact, costs, and
risk
How?
■ Use prioritisation techniques to set a high-level approach

nt
to each threat and opps. For example include:
r ge – Link to overall strategy
U
– IT/tech difficulty
– Culture etc
■ Contract to current investment and roadmap
■ Workshop/agree with stakeholders
Inputs?
Prioritise ■ Quantified Threats and Opportunities

mitigation ■ Business strategy
responses
■ SME/stakeholder input
■ Current investment plans and roadmap
Outputs?
nt
r ge
U
■ 2-3 mitigating high level responses

to develop/action
■ Challenge to existing plans and roadmap
Current State & Digital Maturity
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
Definition Typically Contains

The Current State and Digital Maturity stage brings ■ Organisational SWOT (Digital Perspective)
together an organisation’s existing business
performance metrics and operating model with an ■ Current state Op Model, Tech, Channels
understanding of the key gaps and issues relating
to their digital capability relative to peer and ■ KPI performance
industry benchmarks.
■ Channel volumetrics
Having a clear understanding of how the
organisation performs today and its level of digital ■ Financial position and objectives
maturity will provide clear direction as
to where the organisation should focus its attention ■ Digital maturity assessment
and strategy.
Current State and Digital Maturity (cont.)
Existing Business Insight New VOB Insight
Current State Channel

Organisational KPI Financial Maturity
Operating Volumetric
Swot Performance KPIs Assessment
Model
Maturity
Ranking
Surveys and Gap Setup Analysis and Action Planning
and
Interviews analysis
Saving
Potential 1-2 weeks 4-6 weeks
■ Achieving deep ■ Assessment of ■ Identification of ■ Issue and ■ GAP analysis ■ Get agreement
insight, voice of the maturity and gaps to peer
Focus
■ Establish goals manage survey against: on findings and Digital Strategy

business and potential benefits groups and cross responses implications Objectives
business facts industry and approach – Opinion leads
■ Identify (Benchmarks) (benefits case)
and KPIs ■ Agree survey
candidates and – Client industry
scope and
conduct follow- specifics
targets
up interview
(Functional
levels, business ■ Potential
units) prioritisation Digital Vision
■ Identify sample ■ Obtain additional ■ Identify
■ A validated data ■ Clear maturity ■ Indication of gaps
and gather data sources for strengths and
set of fact and levels identified against peer group
Outcomes
opinion and best-in-class contact details further support weaknesses

■ Quantify potential data (Operating ■ Agreement on
■ Voice across the benefit linked to ■ Deep dives and ■ Brief other data
requirements Model, org how insights Digital
organisation – at all maturity identification of key
charts, training feed into Vision Capability
functional levels improvement themes Model
records, etc.) and Strategy
Digital Strategy Objectives & Principles
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
Definition
Defining clear objectives and principles for the Typically Contains
strategy is imperative. The strategy will describe ■ Digital Objectives
how to achieve the required goal(s) but that goal
must be clear and shared across the various ■ Points of differentiation
business stakeholders. ■ Digital scope
Equally a digital strategy that is not consistent with ■ Alignment to corporate/business strategy
the overall corporate strategy will either fail outright
or deliver the wrong thing. Capturing a set of ■ Customer principles
principles to inform the strategy project will also ■ Constraints
assist in crisp decision making later on. An
appreciation of constraints will maintain realism.
Digital Strategy Objectives and Principles
The Digital Strategy Objectives and Principles element is about providing a

solid foundation for the strategy
The objectives represent the goal that the strategy will be

Strategic designed to achieve. The more clearly they are defined, the better
Context is the chance of producing an effective strategy.
Inputs The principles underpin and inform the development of the

strategy and may be include constraints if these are not to be
articulated as a separate element.
Current State
and Digital Process
Maturity
Approx 2-hour workshop with most senior

client team including Exec Sponsor –
Would be ideal as kick-off for Steering Group. Objectives and
Principles
Consider Document
Write up
■ Points of differentiation workshop outputs
■ Digital scope Include final draft
Output
Circulate and as item for
■ Alignment to corporate/
gather feedback approval in
business strategy
Steering Group or
■ Customer principles equivalent meeting
Issue for sign off
■ Constraints and then baseline
How it fits together
Vision Statement
Goals
Guiding
Principles
Critical Success Factors
KPIs & Metrics
Digital Vision
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
Definition Typically contains

The Digital Vision is a concise but evocative
■ Business
statement, picture or both that neatly encapsulates
what the business is trying to achieve in a ■ Customer
qualitative sense. A good Vision describes what the
outcome will be – what it will feel like – for the most ■ Technology
important stakeholders of the business.
■ Colleagues
While objectives and principles have a rational
appeal, the Vision is there to appeal to peoples’ ■ Geography
emotions. It should both excite people by giving the
outcomes a tangibility but also answer the question
“what does it mean for me?”
Digital Vision
Strategic
Context Customer
Inputs
Colleagues Business
Digital Strategy
Objectives and
Principles Digital Vision
Geography Technology
Digital Vision –
document/
Process statement/visual
Stimulus across Draw/build vision Produce summary Socialise with Finalise summary
Output
all five for each Vision statement/ stakeholders Vision statement/
dimensions dimension visual as required visual
■ Half/whole day workshop OR consider a crowdsourcing approach ■ Workshop or meeting ■ As professional as

■ Professional wordsmithing/ visual design may help in producing a really possible
compelling vision
Culture and Behavioural Change Management
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
Definition Typically contains:

Change comes in all shapes and sizes. The ■ Strategic alignment
methodology assists clients with the people and ■ Systematic approach
organizational “change” aspects of transformational
projects. ■ Employee involvement
For a Digital Strategy engagement, the Behavioural
■ Sustained benefits
Change Management model will align it’s self with
the overarching change that the client is ■ Communications strategies
undergoing as a result of digital change.
Our approach to behavioral

change management is
under-pinned by strongly held Strategic Senior leadership alignment critical to success of any change
points of view borne out of Alignment program
deep experience across
geographical, sector and
cultural boundaries. Behavioral Change is complex, impacting the whole
Systemic organization
Approach
People perform best in an environment they have

Employee been part of designing
Involvement
Sustaining change is the primary objective

of any change program. Measuring the
Sustained impact of change enables a sustainable
Benefits approach.
Communi- Communications is a strategic lever to

cations enhance awareness, buy-in and
Strategies ownership across the organization
Our model divides our Service methodology

into three stages – Analysis, Engagement
and Delivery. Each stage features three
BCM elements and the outer ring shows Change Risk
Analysis
communications as a core element in all Business Change
change management activities. Case & Vision Strategy
for change
The stages and elements have a logical
order – but in reality managing change is an
iterative process with change management Benefit
Realization & Change
techniques applied in a situational context Sustainable Global Leadership
and often running in parallel. Performance Behavioral
Change
Management
However, it is often necessary to execute Methodology
behavioral change management in the
People
context of a rather linear project with Transition
Stakeholder
sequential phases and steps. & Workforce
Management
Effectiveness
KPMG’s BCM Approach shows how the
model can be applied accordingly to account
Organizational Involvement
for a linear project character but to keep the Integration Strategies
flexibility that is needed for effective
situational change management.
… Behavioral Change Management is about getting people ready, willing

and able to deliver sustainable business benefit
Strategic Business Question:

What organizational risks need to be identified and managed to help
improve readiness for change?
Objective:
To develop a holistic understanding of the landscape of organizational
risks for the upcoming change across all elements of the BCM framework
Tools:
• Stakeholder Analysis
• Change Risk Analysis
Strategic Business Question: • People and Organization Risk and Issues Log Strategic Business Question:
Why do we need to change, what are the • Culture Surveys What is our overarching strategy to prepare
desired benefits, and how does it impact • Communications Assessment. the organization for change?
me?
Objective:
Objective: To develop a thorough roadmap in close
To define a compelling business case and collaboration with the Project Management
vision for change as a means to engage up- Office (PMO) which synthesizes various
front buy-in and aligned consensus while change inputs into an integrated roadmap
laying the foundation for a communications containing not only all change Management
plan with key messaging across all Change Risk dimensions but also all interdependent
audiences Analysis initiatives in play. In addition, the
Business
Tools: Case and Change governance infrastructure of a Change
Strategy Agent network is set up as the execution
• Business Case for Change Framework Vision for
arm.
• Visioning the Future change
• KPI Profiling. Tools:
• Organizational Impact Analysis
• Change Strategy and Plan.
Analysis is about assessing the organizational risk and

cultural readiness of an organization for change while
concurrently laying the foundation for a compelling
vision and executable Change Strategy going forward, as
tailored to the unique context of the client
Engagement is about proactively Strategic Business Question:

addressing and mitigating change How do I help ensure that I have galvanized
resistance. This phase is focused on leadership consensus for the change and how do I
Change
engaging and mobilizing leaders and mobilize them to help manage their stakeholders?
Leadership
stakeholders through a structured Objective:
Change Network and driving To assist leadership to be effective leaders within
awareness, buy-in and ownership the context of driving transformational change.
through a series of interventions Tools:
• Change Leadership Behaviors Diagnostic
Stakeholder
• Generating Leadership Alignment Events
Management
• Leading Change Workshop (Educational tool)
Involvement
Strategies

How do I manage stakeholders through the
change with a particular emphasis on
proactively mitigating behavioral
resistance?
How do I get stakeholders groups involved in the ‘what’ Objective:
and/or ‘how’ of the change to develop their buy-in and gain To mobilize the change strategy, it is key to
active involvement in making it a success? take the change architecture and network
and bring it to life through active
Objective:
stakeholder management. The goal here is
To develop an effective involvement strategy and plan
to cascade awareness and preparation for
across all stakeholder groups and to create momentum
change throughout the organization.
behind the change.
Tools:
Tools: • Stakeholder Management Framework
• Communications Strategy and Plan
Delivery is about moving to the

“implementation” mode of the
How do I measure and monitor progress to help
change journey by preparing affected
ensure sustainable benefits?
stakeholders for the new people,
Objective: Benefit
process and technology impacts of
Realization &
To develop a set of tools to drive sustainable the change. The change strategy in
Sustainable
organizational adoption and measure potential Performance delivery is more pragmatic and
benefits realization focused on helping ensure the
Tools: workforce is being equipped with the
• Sustainability Checklist People right tools to be positioned for
• Knowledge Transfer Strategy Transition success.
• Management Monitoring Dashboard. & Workforce
Effectiveness
Organizational
Strategic Business Question: Integration
Once I understand the impacts, how do we help
position the workforce to successfully adopt the
future state business model?
Objective:
To create a workforce transition strategy which
takes into account job role impact and training, as
well as navigating the knowledge, skill and ability Strategic Business Question:
gaps Is the operating model and organization structure aligned to the strategy and
does it create an environment that positions the workforce to be successful?
Tools:
• HR Frameworks Assessment Objective:
• Competency Frameworks Assessment To develop a future state organization at both the macro and micro levels that
• Job Impact Analysis aligns the workforce to adopt and execute effectively in the changed
• Training Needs Analysis environment
• Redundancy and Transition Cost Model Tools:
• Workforce Transition Countdown Roadmap. • Organizational Blueprint
Customer Research
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
6) Customer Research
■ Who are/will be the ■ Customer metrics (NPS, CSAT)
target customers
■ Customer value model (s)
■ Customer trends
■ Analytics data from business
■ Customer segmentation
■ Ethnographic research
Why conduct customer research when designing a digital
strategy and what is the key to success?
Customer research
It is important to understand the following from our
customers when designing a digital strategy:
■ What are the current customer journeys for our
customers when interacting with the organisation?
■ What do our customers think are the ‘critical
interactions’ or ‘moments of truth’?
■ What do our customers think of us?
■ Do our customers have appetite to be digital?
■ How do our customers behave in the context of
digital
■ What are the latest digital trends affecting our
customers and target customers?
Digital Strategy Development Approach
Customer Research
Phase 1 Phase 2 Phase 3 Phase 4

Direction Setting Customer Business Design Execution Planning
Propositions
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
Why conduct customer research when designing a digital
strategy and what is the key to success? (cont.)
Some key principles when conducting customer research in a digital context:
Do the hard work up front: Having an understanding of

specific areas that you want to research is key to receiving
1 specific and ‘actionable’ output and complements the more
broad market research and benchmarking.
Think multi-channel: Research can be limited if the scope is

restricted to digital only. To gain greater insight into customer
2 views, behaviours and ideas it is favourable to take a ‘product’
rather than ‘channel’ view.
Embed customer research into you organisation: Customer

centricity has never been higher on the agenda. The voice of
3 the customer needs to be heard in every initiative our clients
undertake
Customer research
KPMG believes there are four categories of customer research relevant to digital strategy
KPMG believe that listening to what customers tell us about quality of service and what is really
important to them provides great insight, but increasingly our approach also focuses on the
behaviour of customers. Ethnographic research methods such as shadowing and diary studies
are proven to successfully augment our tried and tested qualitative and quantitative research
methods and provide valuable insight when thinking about the products and services of the
future.
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Customer research (cont.)
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Qualitative Research
Qualitative customer research is one of the most traditional methods

of customer research and can provide real insight into what customers
are thinking.. Common methods are:
■ In depth customer interviews: One to one interviews with
customers, usually existing customers that have recently been
through an experience, for example buying a product or making a
complaint.
■ Focus Groups: Can be conducted online or co-located. This format
involves a discussion between customers or ‘non-customers’ and is
moderated by someone acting on behalf of an organisation.
■ Crowd sourcing: An online community that convenes periodically to
provide feedback to an organisation. Increasingly seen deployed
abc
across large organisations such as Barclays, RBS and Westpac
■ Social Media Monitoring: Increasingly being used. For example
twitter is now actively being monitored and managed by
organisations, with social media strategy forming a key part of a
wider digital strategy. Can also provide key information about
competitor organisations if proactively monitored
Example: KPMG Crowdconnection

We drive engagement and behaviour change in consumers, employees and other stakeholders through
building conversations and socialise issues and ideas. We deliver this by online community building,
content creation and curation through our crowd souring tool ‘CrowdConnection’.
Quantitative Research
Quantitative research is used widely to give businesses measurable

insights into how customers rate their services in addition to market
trends and insights. The most prominent examples of these are:
NPS: The Net Promoter Score, or NPS®, is a customer loyalty metric
based on the fundamental perspective that every company’s customers
can be divided into three categories: Promoters, Passives, and
Detractors. It requires specific pieces of research to get a view of NPS
by channel (i.e. Digital) or by service.
CSAT: The customer satisfaction score (CSAT) intends to measure the
customer’s satisfaction with the service received, typically expressed as
a percentage between 0 and 100, with 100 representing complete
customer satisfaction.
123
Customer Effort: The Customer Effort Score is an emerging measure
which asks customers whether they had to expend more or less effort
than they expected when interacting with their provider.
Other useful quantitative research methods that can give us insights
into our customers or our ‘non-customers’ are:
■ External analysis, benchmarking and market reviews.
■ Research and analysis of data held within the business such as
operational or complaints data or
Data Analytics
Using innovate data modelling techniques, ‘voice of the customer data

can be integrated with revenue, cost, product, risk, channel and
profitability data to provide actionable insight to business decision
makers from the front line through to the boardroom.
Tools such as KPMG’s Mass Opinion Based Intelligence (MOBI)
Approach can be deployed to analyse large amounts of unstructured
data, for example, from social media sites.
Example Applications Could Be:
I. Identify target customer cohorts using KPMG’s structured and
unstructured data analytics capability.
II. Capture patterns of behaviour across focussed areas of the base’-
potentially according to value, early patterns of new behaviour
0101010101010101010 (‘outliers’), advocacy etc.
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Ethnographic Research
Ethnographic research studies the behaviour of customers and not just

what they tell us. This is important when thinking about customer
centric design. Behavioural economics and ethnographic methods are
used to capture ‘real’ behaviour and it’s context.
Online ethnography can take the form of web analytics on organisations
websites, social media monitoring, conversation driver analysis and
sentiment analysis. Typically this involves using methods and tools to
process large amounts of data, such as social media monitoring tools.
This knowledge and insight can be used to:
■ Understand customer motivations when making online purchasing
decisions
■ Enhance an organisation’s web site and associated content to
reflect the interests of customers and target customers
■ Enhance and develop a businesses digital product and service
offerings
Finding from ethnographic research can be validated by ‘taking it

offline’ and conducting qualitative research
Diary Studies Online Ethnography Shadowing Contextual Interviews
A customer’s journey
A customer’s journey very often crosses multiple channels and this should be considered
when carrying out customer research for digital strategy
KPMG believe that when customers interact with our clients they often need to utilise a range of
channels to execute what they need to do. We therefore believe that even when designing a
digital strategy, the customer research should encompass all possible channels as well as digital,
to ensure alignment with the organisation’s overall distribution strategy.
A customer’s journey (cont.)
Example – Making an application for a mortgage
Conduct
research and Book
Digital
compare Submit AIP Locate appointment with Receive Funds
rates application branch mortgage advisor notification of transferred
Start AIP
application application
successful
Telephone
Query about AIP Chase

application application
progress
Customer
Location Network
Appointment
with mortgage
advisor to select Complete
product application
Customer research
KPMG has an approach to customer research that forms part of a robust method in
diagnosing customer experience and designing future change initiatives for our clients
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Customer research
The customer 1 Customer Commitments 6

■ The customer is at the heart of the ■ An assessment of customer service
methodology. level agreement s(SLAs) and how
organisation performance
Service Catalogue and Customer 2 measurements and capability are
Journeys aligned to deliver them.
9
■ A robust dictionary of end to end
services that are provided to front line 7
Data Analytics 7
3
customers. ■ Assessment of internal and external
■ Customer journey mapping and MoT 8 data using our ‘seven sources of data
hypothesis. model’.
1
4 Risk and Control Assessment 8
Customer Experience 3
■ Identify and map risks and controls,
■ Voice of the Customer assessment and
understand gaps, overspend and
research to identify the key Moments 2
6 impacts on change interventions.
of Truth for customers – and out
client’s performance at these 5
Customer Centric Design 9
moments.
Voice of the business 4
■ Utilise design thinking and open
innovation approaches to realise better,
■ Get the view from staff on the key
more relevant and disruptive future
customer service issues and potential customer experiences.
improvements.
Decisions and the change agenda 10
Cost Insight 5
■ Build a case for change engaging
■ An analysis of your fully allocated cost Enhanced decisions and change agenda stakeholders, quantifying costs and
base, and how it aligns with the benefits, prioritising opportunities and
delivery of customer services. assessing current investment plans.
Customer Propositions
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
7) Customer Propositions
■ Customer Experience/Usability principles
■ Product and service propositions and innovations
■ Industry disruption opportunities
■ Content strategy/Information arch
■ Cross-channel approach
Customer proposition
The Customer Proposition draws upon the business direction and customer research findings to
shape customer centric propositions that inform the business design and execution planning
Process
Strategic
Context
Product and Content Strategy/
Customer Cross Channel
Service Information
Inputs Experience Vision Approach
Propositions Architecture
■ Digital six Levers ■ Business strategy and ■ Customer and Competitor ■ Digital strategy: implications
■ Service Definition performance assessment review assessment
■ Customer Journeys and ■ Proposition ‘Discovery ■ Cross Channel insights ■ Content platform and
Moments of Truth ‘Customer and Competitor ■ Channel role definition architecture/integration
review; Acquisition; assessment (including
■ Customer Research and Data ■ Future cross channel
Customer Analysis
Retention; Servicing;
capability assessment
integration with broader
Advocacy; Cross Channel digital capabilities)
Research ■ Customer Commitments ■ Proposition Development ■ Future cross channel ■ Sourcing/supplier selection:
■ CE Business Initiative capability business case criteria definition and
■ Proposition Business Cases
Prioritisation ■ Operating Model implication evaluation scoring/
■ Proposition Testing assessment recommendations
■ Future State Customer
Informs
Experience Design ■ Proposition Selection ■ Digital Operating model ■ Programme/Project Mgt

proposal including delivery
Innovation implication assessment
roadmap
Project One-Pager describing

Customer Proposition, Business
Objectives, Scope, Solution,
■ Customer, Technology and Competitor Assessment Costs + Benefits.
■ Market scenarios
Output
Inputs
■ Threat & Opportunity Exploration & Assessment
■ Landscape Response Opportunities
■ Opportunity Evaluation Customer
Proposition
■ Opportunity Selection
Idea prioritisation matrix
Prioritisation criteria
Impact
Relative value proposition
considering:
 Strategic alignment
 Revenue growth
 Cost reduction
 Increased productivity
 Customer growth
 Market differentiation
 Brand and market
perception
Ease of implementation
Relative ease of
implementation considering :
 Difficulty
 Cost
 Resourcing
 Timing
 Business and technology
impact
What does innovation mean at KPMG?
A definition Digital ideation

Something different.... which makes an impact!
We can all consciously innovate in our day to day roles – in fact we do it all the time.
Types of innovation
Our day to day innovation is typically sustaining innovations – important but small incremental improvements
on efficiency and effectiveness.
There is also adaptive innovation – when we do something significantly different that transforms how we deliver
to our clients or adds a new service line or product or delivers significant additional value to our customers.
And finally there is disruptive innovation – innovation that truly changes our business model.
Generate ideas – get creative!
Consciously being more creative and brainstorming new ideas makes a big difference. Look for inspiration in how
others perform the task in similar industries, and empathise with your customer (understand the ‘job’ they are
getting done when accessing the service or process you are trying to innovate).
Prototype and execute
Ideas without execution are not innovation.
Turn your ideas into action by trying small controlled experiments or prototypes and see if they work. The aim
here is to learn from your experiment, and adapt it to become an important improvement.
Embed innovation as a capability
In today’s volatile and uncertain environment, our ability to adapt and improve will set us apart. It is a capability
that our clients will value. And like anything, it gets better with practice....
Some of KPMG’s innovation channels
BraveBanana is KPMG’s crowd sourcing tool

A client can share a business challenge with us,
which is placed on our internal network for the
bright minds to share insights and ideas on how
to address the challenge.
Tibbr is KPMG’s internal social media platform

Providing professional services is social by
nature. Tibbr is a place to share and engage in
discussion, breaking boundaries and a platform
that enables us to exhibit our oneKPMG values.
Live Innovator Workshop is KPMG’s internal idea

generation technique
Live Innovator Workshop are an interactive
brainstorming technique which raidly
generates ideas, generates strong
relationships betwen team members, and
delivers a pathwya to execution for the best
ideas a voted by the workshop participants.
Evolution Channel is KPMG’s innovation portal

Enable KPMG people of all levels to share
ideas of sustainable continuous improvement
with KPMG senior leadership, in addition
simplify processes in line with the firm’s
Transformation strategy.
Digital Capability Model
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
8) Digital Capability Model

■ Device support ■ Analytics – Customer, Operational
■ App/web development ■ Optimise/grow/defend/acquire
■ Digital enterprise ■ People capabilities and skills
■ Social media
Capability and Resource Allocation
Central Supporting Functions

Change
Testing
Management
Creative Digital Customer
Design Governance Insight
Security
Community App
Management Development
Technology
Brand
(Large Copy
UX Design Strategy
Change) Writing
Operations
Content
Aggregators (Small
Management
Change)
Operational Affiliates
PPC Risk
Support/
Management
Help Desks
Behavioural Buzz
Targeting Monitoring
SEO Mobile
Marketing
Keys: Analytics
Capability Outsourced? Mobile
and Data
Strategy Display Location Central Capabilities
Advertising Based
Acquisition Marketing
(Non Digital Specific)
Multi Social
Conversion Channel Media Digital Team
Loyalty
Digital Digital Marketing
Strategy and
KSOR
Planning
Digital Strategy Team
Change
Organising around digital capabilities
Informal/Dispersed Independent/Silo’d
Centre of Excellence Hybrid/Hub and Spoke
Organising around digital capabilities (cont.)
Informal/Dispersed
■ Effective in early stages for smaller companies
■ Reactive and Random
■ Lack of consistency
■ Inefficient
■ No strategic scalability
Independent/Silo’d
■ Effective in early stages for smaller companies
■ No clear leadership
■ Drives competitiveness rather than collaboration
■ Duplicate resources
■ Inconsistent user experience – confusion
Organising around digital capabilities (cont.)
Centre of Excellence ■ Consistent messaging and branding

■ Common tools
■ Cost efficient
■ Clear ownership and accountability
■ Slow to respond to change
■ Lack of innovation – stifles creativity from the sidelines!
■ Too process driven
■ Strong technical abilities ... But not strategic
Hybrid/Hub and Spoke ■ Enables continuous innovation

■ Business units take ownership with central support – drives
momentum
■ Maintains a central point of direction for CE and Brand
■ Encourages collaboration and connectivity
■ More strategic
■ Would it work in a highly silo’d/competitive business?
■ Does the digital team have ‘enough skin in the game’
Operating Model Impacts
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
10) Operating Model Impacts

■ How business organises ■ Channels/products/services
around digital
■ Insource/outsource/partner options
■ Alignment to customer
■ IT architecture impacts
segmentation
■ Operating model design to
realise required capabilities
Operating model
Inputs: The Digital Operating Model reviews and develops operating model design through a range of
■ Corporate strategy, business model and lenses. This is informed by the current state assessment of digital maturity. The review uses
business drivers established KPMG Operating Methodology and applies a range of Operating Model lenses which
■ Operations strategy include specific focus upon the digital operating model
Inputs
■ Digital strategy
■ Current State and Digital Maturity
■ Customer strategy and segmentation
Process
■ Distribution strategy
■ IT architecture strategy
Operating Model Digital Operating Customer &

IT Architecture
Design Model Distribution Strategy
Current State ■ Corporate Strategy, ■ Digital strategy ■ Assess customer ■ IT Architecture strategy
and Digital Business model & assessment strategy and ■ Current state
Business driver segmentation
Maturity ■ Digital maturity assessment
assessment ■
assessment Channel choice ■ Digital gap analysis
■ Review Operations propensity modelling
Lenses
■ Operating Model ■
Strategy & Understand Solution proposal and
Roadmap ■ Digital analytics to
Needs business case
Approach ■ Operating Model function
develop micro segments
■ Rapid exploration of and preference indicators
specification
design options ■
■ Channel choice and ‘in
Operating Model
■ Develop and evaluate digital channel’
Assessment of the operating model through organisation impact
operating model implications assessment
a range of lenses using business and wider assessment
concepts (operating model,
inputs to review and develop operating ■ Operating Model financials, migration)
■ Develop new Operations
model design business case
Strategy ■ Distribution strategy
■ Operating Model assessment
■ Business case
implementation plan
■ Channel migration and
optimisation options
Operating model process and example outputs
Example outputs focus upon the Digital Operating

The Operating Model lenses enable Model and illustrate both resource allocation
review and development of the review at the current maturity state and an example
operating model of the future digital operating model Roadmap
development
Process
Strategy assessment
Output
Digital
Lens Reviews and Capability
Workshops
Model
Circulation and feedback
Issue for sign off


Centre of
excellence
Digital Operating Model – High Level Example
The below Digital Operating Model represents a high level picture of proposed future state operations. This is intended to be used as the
basis for planning and implementing future digital initiatives and as a critical reference point for leadership to describe a common view of
the future state.
Governance Operations
• Governance structure and • Lifecycle execution
approach • Core processes
Governance • Funding model • Measurement
• Policy and risk • Support
Strategy Strategy Technology
• Vision and direction • Infrastructure
• Data and content strategy • Data Architecture
• Business strategy alignment • Applications & Tools
• Evaluation framework for • Strategic partnerships
business use of digital
People and skills

People and • Skills and capabilities
Operations Technology
skills
• Strategy and design
• Digital project management
• Digital Marketing
• Data analytics
• Creative design and CX
• Digital Testing and
Development
• Infrastructure & Architecture
• Career development
Digital Technology Strategy
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
9) Digital Technology Strategy

■ Technology landscape ■ Cross-channel technology
■ Reference architectures ■ Supply chain
■ Channel technologies ■ Employee technology enablement
■ Enabling technologies
Technology Strategy
The Technical Strategy element is about defining how

technology can support the overarching digital
strategy. It is the responsibility of the IT Architect to
ensure this alignment
The technical strategy should define the target digital

technical landscape and identify the alternative
Digital Vision IT Delivery Model technology solution and delivery options that exist to
realise the target. For example, the IT architect must
Inputs
consider, package solutions, in-house development,
partnering, Software As A Service etc.
Key areas of consideration

•Multi Channel Aspect
Current IT •Desktop, Mobile and ‘App’ components
Landscape User Experience
•Suitable Vendors and Partners
•Integration with existing back office systems and
Key input personnel: processes
 Enterprise Architects •Development Approach
 Infrastructure Architects
 Channel / Product Managers •Colleague Impact
 User Experience Manager
 Application Delivery Managers
 Procurement
Outputs
Reference
Technology Architecture Solution Overview
Architecture and Cost Estimates
Roadmap Decisions and Blueprints
Patterns
Digital Strategic Roadmap
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
11) Digital Strategic Roadmap

■ Capability development ■ Top 5 launch initiatives
roadmap
■ Customer proposition roadmap
■ Options and priorities
■ Continuous improvement
plans
Digital Strategic Roadmap 1
The Digital Strategic Roadmap element is about establishing a

logical sequence of organisational development activities that will
Current State
deliver the capabilities required to enable the execution of the
and Digital overall Digital Strategy.
Maturity
A roadmap should be:
Digital Strategy ■ Multi-dimensional
Objectives and
Principles ■ Structured
■ Inclusive and collaborative in development
Digital Vision
Process
Inputs
Customer
Research
Culture and
Behavioural
Change Mgt
1. 2. 3. 4. 5.
Operating Organize Define the Assess the Finalize the
Model Confirm
roadmap input requirements lenses components positioning of
Impacts and against which and capture components
scope
(transformation outcomes into to assess the the on the
Digital requirements logical components information roadmap
Digital
Capability and outcomes) components
Technology
Model Strategy
Digital Strategic Roadmap 2
Example Roadmap Lense Evaluation Matrix (ROLEM)
Ne
ed
■ The ROLEM provides a structured approach for capturing and evaluating the factors thataaffectgo whether something should be on the roadmap and if so
where should it be od
roa
– Benefit contribution dm
– Cost to deliver ap
ou
– Customer value t pu
– Technical challenge/architectural fit te
xa
■ mp output.
The ROLEM also captures where elements are enablers/pre-requisites for other elements and this helps to structure the roadmap
■
le
However the approach also take account that there may be qualitative reasons that may affect the positioning of a particular element and this is
captured as ‘Stakeholder Factors’. With multiple stakeholders there will be a political element that needs to be addressed rather than ignored. Hearts
and minds are important as well as logic.
■ Populating the ROLEM can be done through a mixture of desktop analysis and workshops – the project team will need to assess what is the most
appropriate.
■ While hard data (e.g. costs) is always preferable, where this is not available a ‘H/M/L’ assessment can be substituted
■ Consider using digital voting for ‘H/M/L’ assessment
Case for Change
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
12) Case for Change

■ Finance data ■ KPI impacts
■ CAGR projects with/without ■ New proposition NPVs
change
■ Cost of change
■ Transaction volumes
Case for change – builds from the outset...
In truth the case for change will be built-up throughout the Digital Strategy development in
order to secure funding to mature the strategy and roadmap, but this part of the method
ensures different elements are brought together effectively to secure Funding.
Digital Strategy
Objectives and
Principles
Digital
Case for change Digital

Capability
Digital
Strategic
Current State Customer and Operating

Culture and
Case for
Behavioural Change
Change Mgt
Case for Change
The digital case for change will vary significantly from client to client depending on the
relative maturity of digital practices within an organisation.
Immature Digital Organisations Mature Digital Organisations
Educate, Inform and Win Support
Market protection, Remaining Competitive, Innovation
Timescales can vary significantly based on maturity of an organisations digital capability

and buy-in from senior executives, these need to be fully understood early on in the
process of defining the digital strategy and inform how the case for change is developed.
Case for Change three steps to funding
In less mature organisations, there is a need for extensive stakeholder

management and pitching of digital as a credible investment area
compared to traditional more comfortable investment. Ultimately if
investment in digital goes up it will likely come down in another
investment area.
In more mature organisation the initial case for change will have been
achieved historically and the focus of the ‘pitch’ for funding can be much Immature Digital
more project/initiative focussed. Organisations
The information that supports the digital case for change has to convey;
Emphasis
■ The market context – consumer behaviours and demand shifting away from
high-street to digital devices
■ The client context – what is the relative maturity, overall business objective
and ambition of the organisation in the context of the market and
competition?
■ The money – what is the cost to serve for digital? What are the costs of Mature Digital
Organisations
delivery versus return on investments like comparably to other investment
options?
Case for Change – Market Context
Using customer research, external analysis compile a picture of the market and consumer
trends, communicating key messages e.g.
“Increased usage of mobile and “Increased usage web for
tablet devices” banking”
So what?
■ Are strategic threats being
actively managed?
■ Are the client maintaining/
increasing market share?
■ Cost effectively?
No YES
Case For Further Analysis

“Speed of change in the market” “Competitor Threat” Change Required
Greater investment and emphasis may be required in this element of the case for change as it will be used to educate and
engage with key senior business stakeholders.
See Also – Porters 5 forces, PESTEL analysis and SWOT analysis as tools that can be deployed in this phase of case for
change
Case for Change – Client Context
Using benchmarking and analytics to understand:

■ Benchmarking to understand:
– Functional richness compared to competition
– Customer sentiment (e.g. NPS)
– Trend of performance in recent years – e.g.
Strong positions that is being eroded or never
in the running – this will effect how you
enter/re-enter the market
– Position on common data points such as cost
to acquire, web traffic volumes, digital
marketing spend per sale, conversion rates,
drop-off rate
■ Analytics to understand:
■ Specific points in the websites where customers
drop-off
■ Uptake and usage of mobile apps/devices/web
pages
■ Field level analysis of specific parts of a site to
test effectiveness and what-if analysis (through
AB/MVT)
Case for Change – The Money
There are generic quantifiable measures that all projects and programmes must
provide and then there are specific KPIs and Metrics that can be used to demonstrate
Digital Capability uplift:
■ Generic:
– NPV, IRR, ROI, ROCE, pay back period etc
– Product related margin and volume uplifts
– Cost reduction
■ Digital Specific:
– Acquisition – Conversion rate, cost to acquire, sales effectiveness
– Channel Cost Reduction – migration from more expensive channels to low cost-to-serve
model
– Customer Experience – Social Sentiment, Net Promoter Scores etc
Digital Strategy Element 13
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
Strategy Execution Programme

Design
■ Programme design ■ Delivery model choice
■ Execution plan ■ Flexibility, speed, governance
■ Risk identification, mitigation,
proving and control
■ Customer impact assessment
Programme design
We believe the Client can reduce risk on large delivery initiatives by strengthening design
and validation of programme set-up, i.e. by focussing on programme design
During the many years of working on large-scale transformation programmes in Financial
Services we have learnt a lot about effective programme execution. Our observation is that
clients do many of the risk management and programme activities well but some are less good
at:
■ Building an effective execution capability from disparate parts of the Lloyds organisation and
independent suppliers.
■ Managing the realisation of the desired outcome from your investment spend.
We define these areas as execution and outcome risk. Our proposal focuses on how KPMG can
significantly increase the success rate of your programs by building the program governance and
interventions that will manage the execution and outcome risk during the full program lifecycle.
Programme design (cont.)
Burn Rate
Scoping
■ Problem Statement
Product Risk
■ Solution Options
Target Operating
■ Benefit Case
Model
Programme
■ Shared vision of
Architecture
future
■ Org, People, Process,
working model
controls, Information,
Delivery
Application,
Technology)
Execution and Outcome Risk Risk Management

Management Rollout Planning
Execution/ Outcome Risk
Reduction of uncertainty due to risk

management through Programme Design
We suggest to enhance the delivery lifecycle by an explicit method for designing the delivery
phase of the programme. This should comprise of:
■ Identifying the areas of uncertainty in the project in terms of open questions, implicit
assumptions and prerequisites, and planning how to address them.
■ An explicit verification of the project risk register against predetermined categories to provide
a standardised registry of open questions.
■ Ensuring a common understanding of requirements and solution by structured walk-through at
an architecture level.
■ Planning the detailed delivery mechanisms of the engagement.
Designing successful digital programmes is about getting three elements right:
Digital Foundation
capability Programme
Design
Digital
methods
Programme Design – Foundation Programme Design
Digital Foundation
Design
Digital
methods
Frequently when a Digital Strategy reaches this point of maturity and funding is approved
to mobilise a change programme it follows many of the same programme design
disciplines as other programmes of change in an organisation i.e. Getting the foundations
in place for a programme to be set-up for success. This includes:
Planning and The detailed ‘wiring’ of tasks, dependencies and resources into a programme-wide plan based on detailed input
and forward prediction from business and technology SMEs.
Prediction
Organisation and Design of the programme organisation and resource profile to identify critical rolled/teams within the plan where
risk mitigation activities should be focused.
Resources
Stakeholders and Analysis and agreement of the required interaction and needs of stakeholders and suppliers in order to build
these directly within the programme.
Suppliers
Tools and Design of a programme-wide application and infrastructure architecture with standards, tools and templates, to
be used by development, testing and deployment teams.
Infrastructure
Process and Customisation of Lloyds programme management framework and agreement of programme-wide processes and
methods to be used throughout the programme lifecycle.
Method
Communication Design and agreement of the collaborative working environment and communication strategies to be used
throughout by all parties.
and Collaboration
Programme Design – Digital Method
Digital Foundation
Design
Digital
methods
Digital products often need to be quick to market and quick to make a return on
investment, this is largely due to the pace of change in the digital market. As such a more
agile and rapid delivery method is needed, but one that retains the controls of more rigid
and steady–pace delivery models such as QMS or Waterfall. Many digital projects jump
straight to an agile delivery model, which can be very appropriate, buy many
organisations don’t execute agile methods well, so the following are focus areas for
digital execution that can be applied top both Agile and traditional waterfall based delivery
methods.
Traditional methods dictate that requirements must be in place before solutions can be designed and
Rapid design built, rapid innovation and design allows early visual mock-ups to be designed and tested with
colleagues and customers, from which requirements are retro-engineered.
Early proving and Introduction of a ‘Sandpit’ environment during design can allow early prototyping of solutions that
colleagues and customers can interact with at an early stage to feedback on look and feel of a solution.
prototyping
It is crucial for digital programme to have customer requirements by developing a clear view of the
UX and Customer customer and colleague journey when using digital solutions. By embedding UX and Customer
Experience deliverables such as UX Architecture, Customer Impact Assessments, Focus Groups etc.,
Experience Deliverables digital solutions are more likely to be successful in the market
Digital innovation and differentiation are key drivers of growth for many modern organisations, as such it
Tools and Infrastructure is more likely for digital solutions to be new to organisations. This introduces risk of the unknown
Programme Design – Digital Capability
Digital Foundation
Design
Digital
methods
Whilst many project and programme roles within a digital programme are very similar to
any other change initiative there are certain areas of the project lifecycle and certain roles,
where it is important to have the right capabilities. Theses areas include:
BAs with digital experience are not wide spread, so it is often important to find BAs who can quickly
Business Analysis grasp the differences in digital methods i.e. Rapid design and who have experience of using tools such
as Axure.
Digital Architects are crucial in keeping the overall solution overview in tact and ensuring that up-stream
Architecture platform/core systems constraints are managed and overcome. In Addition the introduction of customer
and UX focused architecture will require traditional IT and Business Architects to think differently.
Digital capability is needed in test practices in the form of people with web/mobile/digital experience and
Test the right tools to properly test e.g. Emulation software and hardware for cross-browser testing etc.
Release management for web based solutions can be split between public and secure sites – it is crucial
Release management to ensure that the different parts of an organisations responsible for release and code promotion are fit
for purpose for major digital change
Implementing Programme Design
We suggest implementing the framework in three phases – Adapt, Apply and Prove
Adapt Framework Apply Framework Prove Benefits
(typically 2-3 weeks) (typically 3-5 weeks) (typically 6-8 weeks)
Objectives
Activities
Deliverables
Implementing Programme Design (cont.)
Adapt Framework
(typically 2-3 weeks)
■ Adapt the framework for identifying, describing and quantifying execution risk and
outcome risk.
Objectives ■ Define the tools and process for executive assessment and alignment with existing
authority to proceed points/governance gates.
■ Develop decisioning framework for programme design.

– Confirm categories and key questions for measurement of execution and outcome risk.
– Elaborate decision relevant criteria.
Activities – Define decision making criteria.
■ Adapt proving matrix and update with observations from review.
■ Socialise and agree framework.
■ Agree programme(s) for applying framework.
■ Execution and outcome risk analysis framework including questionnaires.

Deliverables ■ Prioritisation criteria.
■ Proving matrix, decision register and closure process.
Apply Framework
■ Apply framework in an agreed programme/set of programmes.

Objectives ■ Embed proving points into programme(s) delivery approach and proving matrix.
■ Fine-tune approach and criteria.
■ Review programmes across lifecycle stages and review current status, delivery
organisation and approach.
■ Identification of key execution risks and outcome risks based on the above.
Activities ■ Define and agree proving points to evidence management and reduction/elimination of
key execution and outcome risks.
■ Update programme schedule and proving matrix.
■ Proving Matrix for each selected programme.

Deliverables ■ Assessment of approach.
■ Fine-tuned method.
Prove Benefits
Objectives ■ Verify benefits of programmed design based on programme progress and variance.
■ Review project ex-post.

■ Measure critical issues.
Activities ■ Measure schedule, cost and benefit variance.
■ Report on burn-down of uncertainty.
■ Compare against benchmark.
Deliverables ■ Programme assessment and benchmarking.
Case Studies
Case Study: Mobile Payments Strategy for Home Retail Group
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
Sub-set of Digital Strategy Elements with Mobile Focus

■ The client was seeing falling sales in tough macro-economic environment and losing business to competitors with more advanced channel capability, including around payments acceptance
Client ■ While aware of the rapid pace of change around mobile and digital payments, the client did not have an in-depth understanding of the available technologies and the likely rate of adoption in
their target markets
issue ■ A perception by executives at the client that they had underinvested in payment technologies relative to their peers and were now at a competitive disadvantage as a result
■ KPMG conducted an in-depth market analysis of emerging consumer payment technologies and developed insights as to how the market would mature over the coming years
■ The externally-facing analysis was complemented by a review of the client’s current payment and channel and also its broader customer relationship management capabilities
■ KPMG analysed macro-trends in the U.K. And global payments markets and compared these with the client’s customer segmentation data to generate insights as to the risks and
Approach opportunities associated with various potential strategic actions
■ Having gathered the appropriate data and socialised findings and recommendations with senior executives, a capability roadmap was produced to optimise the payments investment path over
the coming years
■ KPMG produced the board paper to present to the group’s strategy day
■ Delivery of an agreed investment roadmap to build the right payments capability for the client’s business
■ A set of clear, actionable recommendations built on a deep understanding of macro-payment trends, social and technological drivers for change and grounded in the specifics of the client
Benefit business
■ A significant uplift in the knowledge of senior managers and executives at the client of this important area for their business
UK Savings & Loan (2) Web and Mobile Programme – In a nutshell...
Background
A Strategic Investment of £1.5m per annum in Web & Mobile was
set in the absence of a clear strategy. This investment was intended to
deliver:
■ Enhanced website functionality
■ Better online customer experience
■ Increased sales effectiveness
‘Discovery’ phase of Web and Mobile
UK Savings & Loan (2) mobilised a ‘Discovery’ phase in partnership with
KPMG in September 2012. This phase of work supported the Web and
Mobile Strategic Investment through:
■ Defining a clear rationale for investment in Web and Mobile
■ Development of a prioritisation framework to inform investment and
sequencing of initiatives
■ Producing a delivery roadmap which details dependencies
■ Producing initial business cases to support CRIC funding decisions
Case Study – UK Savings & Loan (2)
Digital Strategy
Objectives and
Principles
Digital
Digital Digital
Strategy
Culture &
Behavioral Case for
Change Mgt Change
Example
Engagement
Profiles
Engagement Profile – Market Review of Opportunities and Risks
Approx duration
Digital Strategy
Objectives and
Principles 4-6 weeks
Digital
Strategic
Context
Customer
Research
Technology
Strategy
Likely team size
Digital Digital
Roadmap
1-4
Digital Vision Model
Strategic
Current State Operating
and Digital
Customer and
Staff
Model
Execution
Programme
Price range
Maturity Impacts Design
Proposition
Culture &
Behavioral Case for y £50-150k
Change Mgt Change
This variant of the approach is intended to answer questions such as:

■ What effect is Digital having on our marketplace?
■ What risks and opportunities does Digital present for my business?
■ What are the competing technological solutions to a business problem – e.g. mobile payments or enterprise
content management?
■ How will the needs of my customers change as a result of Digital trends?
■ What capabilities does my business need to addresses the risks and capitalise on the opportunities?
Depending on the available budget, timeframe and desired scope of the client – the included modules can also be covered at varying levels
of detail e.g. customer research could be purely quantitative rather than including depth interviews. The Case for Change module may also
be omitted if quantification of the change opportunity/threat is not required.
Typically the output would be a report with market overview, opportunity and risk assessments, recommendations and a high level
investment roadmap.
Engagement Profile – Digital Proposition Development
Approx duration
Digital Strategy
Objectives and
8-12 weeks
Principles
Likely team size
Digital
Context Research Strategy 4-6
Digital
Capability
Digital
Strategic
Price range
Strategic £150-300k + (depending

Current State Operating
and Digital
Customer and
Model
Execution
Programme
on mount of customer
Staff
Maturity
Proposition
Impacts Design research and sophistication
Culture &
of prototypes)
Behavioral Case for y
Change Mgt Change
This variant of the approach is intended to help the client define and test a set of concrete digital customer and/or employee propositions.
Depending on how mature the client’s existing digital strategy is some effort may need to be allocated at the start of the engagement to
ensure that the objectives and underlying commercial, technical and customer principles are clear so that the propositions stand the best
chance of representing strong investment opportunities for the business and going forward to be launched.
Where possible we will draw on existing customer data and research – such as segmentation data, NPS feedback and other information so
that this does not have to be conducted as part of the engagement. Within this type of engagement the most valuable type of customer
research is ethnographic research into the problems or opportunities that the propositions address and user testing of prototypes.
In this type of engagement, capability modelling, op model analysis and case for change work is specifically focused on evaluating the
viability, ROI and ease of implementation of a specific customer or employee proposition as opposed to the development of the business as
a whole.
Examples of propositions developed in this way could be digital personal financial management tools; employee mobile learning apps or
location based offer functionality for a retailer.
Deliverable/Work
Product Examples
Key themes analysis – derive key threats and opportunities
(including themes)
Customers are no longer looking to buy Old and new competitors are testing new
from us in the ways we have historically business models, potentially rendering
sold to them old models obsolete
1▪ Expectation of convenience and 7▪ Digital enables much lower cost
Co
immediacy drives more sales to digital business models – RM-less, branch-
rs
less, teller-less
me
and mobile channels
mp
8▪ Attackers with alternative business
sto
2▪ Quality of digital engagement
eti
experience becomes key models can target specific value pools
tor
Cu
purchase driver
s
9▪ Data availability creates opportunities
3▪ Views on trust and privacy shift, to disintermediate customer
changing the information sources
relationships
customers use to
make financial decisions 10▪ Digital allows companies to extend
their reach, blurring boundaries
between industries
Technology
Technological innovation is fundamentally changing the cost
of doing business
4▪ Process automation dramatically reduces operating costs and enables instant
service
5▪ ‘Big data’ collection and analysis transforms decision-making and risk
6▪ Digital delivers more convenience at lower cost
In XX years, digitalisation could affect up to £XX(XX%)
of current revenues
Prioritise impact using profit pool data

% Of cost/income base at high end Cost Income
Threats Opportunities
£ billions £ billions Commentary
▪ YXZ
XX-XX X%
1–3
X% (XX)-(XX) years
XX-XX XX%
▪ YXZ
XX-XX X% ▪ UC
5
XX% (XX)-(XX)
years
XX-XX XX%
▪ YCJN
XX% XX-XX XX% ▪ UHN
10
(XX)-(XX) years
XX-XX XX%
Within X years, digitalisation will threaten
up to XX% of current profit pools
Prioritise impact using profit pool data % impact

Impact on income, £m
Division/
2012 income Threat Rationale
▪ Customer churn XYZ
Div/ prod - XYZ X%
▪ Significant decline income XYZ
£xxxm ▪ etc
Div/ prod -- X%
£xxxm
XY ▪ Significant decline income XYZ
Z ▪ etc
Div/ prod X%
-X ▪ Significant decline income XYZ
£xxxm
▪ etc
Div/ prod X%
£xxxm
▪ etc
Div/ prod X%
£xxxm
▪ etc
Within X years, digitalisation will threaten
up to XX% of current profit pools
% impact
Prioritise impact using profit pool data
Impact on income, £m
Division/
2012 income Opportunity Rationale
Div/ prod
X ▪ Significant decline income XYZ
£xxxm X% ▪ etc
Div/ prod
£xxxm X
X% ▪ Significant decline income XYZ
▪ etc
Div/ prod
X X% ▪ Significant decline income XYZ
£xxxm
▪ etc
Div/ prod
X% ▪ Significant decline income XYZ
£xxxm X
▪ etc
Div/ prod
X%
£xxxm
X ▪ Significant decline income XYZ
▪ etc
Alignment of threats and opportunities to current
investment plans
Prioritise mitigation responses
£X.X- X.Xbn £X.X- X.Xbn £X.X- X.Xbn

100%
Product/ div 50% 49%

60%
Product/ div 15% 21%

10%
Product/ div 8%
9% 10%
Product/ div 7%
13% 10%
Product/ div 19%
8% 10%
Threats Opportunities1 Investment
Digital Vision – Being a YourBank Client
YB is at the heart of
Client:
my multi-bank I instantly reduce our
Location: Trade Show, Edinburgh exposure to local
strategy. They’re the
glue that makes it banks without
work returning to the office
or disrupting our
business
I approve and Transaction Banking modules are
standards-based for easy integration
generate workflow
1 Relationship
Bank notification of sovereign
Bank notifies me of surplus ! default in one of our key markets means being part
cash balances that could pay of my team, not
down an
inter-company loan.
just selling me
stuff
My company’s salary payments are
processed direct from my SAP system. YourBank Relationship Mgr sends
I can see and approve the payments me a digest of global regulatory
online. issues, so
I feel informed on the issues of the
The bank’s forecasting tools show project a day
Q4
dollar shortfall based on current trading
patterns
YourBank digital solutions integrate

I send a copy of the projections direct to
our FX team for action seamlessly with our Enterprise platform
so I can see exactly how my KPIs are
doing,
in real time, wherever I am
I get the

I review and approve a number of
information in time large supplier payments on my iPad
to make cost- The business is
effective decisions succeeding, I’m
No need to be in succeeding
the office for month
end, now I can
connect on the go
Control > Optimise > Execute
The information contained herein is of a general nature and is not intended
to address the circumstances of any particular individual or entity. Although
we endeavour to provide accurate and timely information, there can be no
guarantee that such information is accurate as of the date it is received or
Note
This disclaimer should only be used on external marketing
that it will continue to be accurate in the future. No one should act on such
information without appropriate professional advice after a thorough materials, not client-specific documents (e.g. proposals or
examination of the particular situation. deliverables prepared under the terms of an engagement letter).
© 2013 KPMG LLP, a Delaware limited liability partnership and the U.S.
member firm of the KPMG network of independent member firms affiliated
with KPMG International Cooperative ("KPMG International"), a Swiss
entity. All rights reserved.
The KPMG name, logo and “cutting through complexity” are registered
trademarks or trademarks of KPMG International Cooperative (KPMG
International).
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Digital Strategy Framework V 8-2

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Digital Strategy Framework V 8-2

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Customer and

1) Introduction – Digital at KPMG

2) Digital Strategy Framework - Overview

3) Framework Element Detail

5) Engagement design variations

6) Work Product Examples

 As collateral for business development and sales activities

 As collateral within proposals

 As a discussion tool with clients

As an accelerator when designing Digital Strategy engagements – no need to reinvent

 As a tool to help appropriately size and price Digital Strategy engagements

 As a prescriptive, rigid, one size-fits-all method

 Only if you are a ‘Strategy Consultant’

Direction Setting Customer Business Design Execution Planning

Scan and map Derive key threats

Time line […] […] […]

>100 10-20 8-10 2-3

Scan and ■ Client documents

■ Typically around 100 innovations and players are

■ Usually excel/PowerPoint table categorising threats

Derive key threats ■ Identify overarching themes across players

■ Workshop/stakeholder agreement to categorise

■ Outputs from innovation scan

■ Set of 10-20 key threats (for a large business)

■ Build quantification model to size potential impact of

■ Build financial analysis model built around:

■ Client data including future sales and cost plan

■ 8-10 prioritised themes developed, quantified and

■ Define potential interventions to mitigate risks,

■ Use prioritisation techniques to set a high-level approach

Prioritise ■ Quantified Threats and Opportunities

■ 2-3 mitigating high level responses

Definition Typically Contains

Existing Business Insight New VOB Insight

Current State Channel

■ Establish goals manage survey against: on findings and Digital Strategy

opinion and best-in-class contact details further support weaknesses

The Digital Strategy Objectives and Principles element is about providing a

The objectives represent the goal that the strategy will be

Inputs The principles underpin and inform the development of the

Approx 2-hour workshop with most senior

Critical Success Factors

KPIs & Metrics

Definition Typically contains

■ Half/whole day workshop OR consider a crowdsourcing approach ■ Workshop or meeting ■ As professional as

Definition Typically contains:

Our approach to behavioral

People perform best in an environment they have

Sustaining change is the primary objective

Communi- Communications is a strategic lever to

Our model divides our Service methodology

… Behavioral Change Management is about getting people ready, willing

Strategic Business Question:

Analysis is about assessing the organizational risk and

Engagement is about proactively Strategic Business Question:

Strategic Business Question:

Delivery is about moving to the

Phase 1 Phase 2 Phase 3 Phase 4

Some key principles when conducting customer research in a digital context:

Do the hard work up front: Having an understanding of

Think multi-channel: Research can be limited if the scope is

Embed customer research into you organisation: Customer

Qualitative customer research is one of the most traditional methods