The Digital Transformation Playbook: Rethink Your Business for the Digital Age

1
The Five Domains of Digital Transformation:
Customers, Competition, Data, Innovation, Value
1
2
Harness Customer Networks
19
3
Build Platforms, Not Just Products
50
4
Turn Data Into Assets
89
5
Innovate by Rapid Experimentation
123
6
Adapt Your Value Proposition
165
7
Mastering Disruptive Business Models
194
Conclusion
239

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C O N T E N T S
Self-Assessment: Are You Ready for Digital Transformation?
243
More Tools for Strategic Planning 
247
Notes 249
Index 261
About the Author 
277

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pre fac e
The rules of business have changed. In every industry, the spread of new 
digital technologies and the rise of new disruptive threats are transforming 
business models and processes. The digital revolution has turned the old 
business playbook upside down.
In my own work, teaching and advising business leaders from compa-
nies around the world, I repeatedly hear the same urgent question: How do 
we adapt and transform for the digital age? 
Businesses founded before the rise of the Internet face a stark chal-
lenge: Many of the fundamental rules and assumptions that governed and 
grew their businesses in the pre-digital era no longer hold. The good news 
is that change is possible. Pre-digital businesses are not dinosaurs doomed 
to extinction. Their disruption is not inevitable. Businesses can transform 
themselves to thrive in the digital age.
In this book I explore the phenomenon of digital transformation: What 
separates businesses that manage to adapt and thrive in a digital world from 
those who fail?
In pursuing the answers to this question, I have been privileged to draw 
on the insights, perspectives, and questions of an amazing range of execu-
tives and entrepreneurs, both through my consulting and keynote speak-
ing, and in my Columbia Business School executive programs on digital 

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P R E F A C E
marketing and digital business strategy. I have been able to conduct re-
search studies on big data and marketing metrics, mobile shopping behav-
iors, the Internet of Things, and the future of data sharing. And for nine 
years, as founder of the BRITE conference, I have convened C-suite leaders 
from global brands, technology firms, media companies, and fast-growing 
startups to discuss the evolving digital business landscape.
One central insight emerged and shaped the development of this entire 
book: Digital transformation is not about technology—it is about strategy 
and new ways of thinking. Transforming for the digital age requires your 
business to upgrade its strategic mindset much more than its IT infrastruc-
ture. This truth is apparent in the changing roles of technology leadership 
within business. A Chief Information Officer’s traditional role has been to 
use technology to optimize processes, reduce risks, and better run the exist-
ing business. But the emerging role of a Chief Digital Officer is much more 
strategic, focused on using technology to reimagine and reinvent the core 
business itself.
Digital transformation requires a holistic view of business strategy. In 
my last book, The Network Is Your Customer, I focused on the impact of 
digital technologies on customers—their behaviors, interactions, and rela-
tionships with businesses and organizations of all kinds. In this book, I take 
a broader scope, looking at five domains of business strategy: customers, 
competition, data, innovation, and value.
Like my previous books, The Digital Transformation Playbook focuses 
on practical tools and frameworks that readers can apply in making deci-
sions and formulating strategies for their own business, no matter their 
size or industry. I have packed the text with case studies that illustrate the 
concepts and illuminate the strategies. My hope is that you, the reader, will 
bring the playbook into action by applying its lessons and discovering the 
next stage of value creation and growth for your business.
Acknowledgments
No book is possible without the help of many generous contributors.
I thank all the many business leaders and writers whose work is cited 
in the book, especially those who shared their experiences with me in detail 
in the classroom, onstage at conferences, or in interviews.
This book would not have happened without my agent, Jim Levine, 
and my publisher, Myles Thompson, championing the project at every 

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P R E F A C E

xi
stage from the very beginning. They both have my enduring gratitude. My 
editor, Bridget Flannery-McCoy, provided invaluable feedback in crafting 
the pitch and structure of the book. Rita Gunther McGrath, a fellow faculty 
member and co-conspirator at Columbia Business School, provided both 
rich intellectual inspiration for many ideas and critical feedback towards 
the end of the writing process, helping me hone the book’s focus and core 
message. Karen Vrotsos was the perfect editor of the final draft, sharpen-
ing each turn of phrase, tightening the prose, and ensuring that every idea 
would be clear to readers approaching it for the first time.
Columbia Business School has been the greenhouse for my work for 
over fifteen years. Mike Malefakis has been a great champion of my teach-
ing as a member of the Executive Education faculty. Bernd Schmitt and 
Matthew Quint supported my research at the Center on Global Brand 
Leadership for many years. Schmitt and my speaking agent, Tom Neilssen, 
provided excellent advice during the initial planning of the book. Alisa 
Ahmadian contributed expert background research, and Oded Naaman 
designed the playbook’s five handsome icons. Stephen Wesley at Columbia 
University Press and Ben Kolstad at Cenveo answered all my questions and 
worked arduously to keep the publication on track at every perilous turn 
of the process.
Lastly, I thank my wife, Karen, and son, George. They kept me going, 
inspired my creativity, and picked up my slack during the weeks I spent 
absorbed in writing. Their love is the inspiration behind all my work.