- What digital transformation means for business?
- Is digital transformation a strategy?
- What are the main areas of digital transformation?
- Why do companies fail in digital transformation?
- Digital transformation examples.
- What makes digital transformation successful?
Digital transformation’; two words that are likely to make some businesses cringe. This article explores the importance and benefits of digital transformation. Yes, it’s hard work, but get it right and your business will thrive. Businesses that are not willing to undergo a digital transformation will perish.
Why Some Businesses Love to Hate
Some businesses love to hate digital transformation because it means changing the way they have always conducted business, forcing them to learn new ways to do things. They see the transformation to using digital technology as an obstacle for business continuity. Some businesses feel their long-practiced methods have been successful and that changing these methods is unnecessary.
Disruptors don’t set out to beat you at your own game – they change the rules. Kai Riemer, Professor of Information Technology & Organisation, University of Sydney, Australia
What Is Digital Transformation?
When a company goes through the process of being digitally transformed, this means they are updating and expanding upon technology they had been using to achieve higher productivity, differentiation and innovation to better serve their customers. Companies that want to enjoy continued growth and success must be willing to upgrade as the technology prevalent in their industry evolves. Furthermore, they must be willing to invest in new technologies as well as a comprehensive training program to prepare their staff to use it efficiently, effectively and productively.
When a snake sheds its skin it changes; when a caterpillar becomes a butterfly, it transforms.Someone at the Business Transformation Academy
Why Business Transformation is Important?
Businesses must understand and embrace the idea of transforming the processes they use to better, faster and more accurate digital processes that lead to increased productivity. Digital technology can provide businesses with several very important benefits. Many businesses must make the transformation to digital technologies and processes to continue to survive, remain competitive and grow. If they don’t make the transformation, they won’t be able to protect the revenue they have or generate more. Plus, they won’t be able to attract, hire and retain the best, most talented employees and maintain their market share.
Innovation and Continuity
When businesses undergo the transformation to digital technology, they may experience a positive impact in five very important areas. They are:
Many of today’s most important and lucrative innovations are being made by talented, creative, individuals and teams using digital technology. Companies too stubborn or cheap to embrace the rapidly growing and evolving digital technologies will soon be relegated to the scrap heap of has-beens. To remain competitive in almost any industry, companies must continually innovate new and better ways of developing, producing and marketing goods and services. Plus, digital technology makes it easier to ensure business continuity and recovery in the aftermath of seismic events like natural or manmade disasters.
1. Customer Experience
Constantly enhancing and improving the customer experience is an important key for attracting, engaging, growing and retaining a lucrative customer base. Embracing the use of digital technology can help older, established businesses to increase customer satisfaction and engagement by creating a more enjoyable customer experience. The transformation to digital technology can make it faster and easier for customers to find and purchase the products and services they need and want. An improved customer experience increases sales and profits and results in greater customer satisfaction.
2. Operational Agility
Enhanced operational agility is another reason the transformation to the use of digital technology is so crucial. Businesses with operational processes that are agile and nimble enough to quickly meet the changing needs of their customers and their industry are the ones that will maintain and increase their market share. The modern consumer wants to work with companies that can instantly provide them with the services they need. Effectively using digital technology gives companies the operational agility needed to quickly respond to consumer demand.
3. Process Transformation
The days when painstakingly slow production, sales and marketing processes were acceptable are long gone. In order to thrive today, companies must continually streamline and transform their processes to get faster and more accurate results. Transforming their processes through the use of digital technology enables companies to move at the speed which modern consumers and business practices demand. Digital process transformation using cutting-edge technology is essential for business success both today and in the future.
4. Business Model Transformation
Digital technology enables companies to quickly and continually assess whether their business model is efficient and effective enough or if it needs to be changed. For many older companies, a business model transformation is essential if they are to remain profitable in today’s rapidly changing business environment. Companies that have made the transformation to digital technology are better able to identify shortcomings in their current business model and quickly change to a more effective and profitable one.
5. Cultural/Organisational Transformation
Staying ahead of business rivals and continuing to attract the best, most talented workers, as well as additional customers, sometimes requires companies go through a cultural or organisational transformation. The business and organisational culture that worked decades ago must be transformed to better suit the needs of the new, more technologically savvy, workers and consumers. The rise of digital technology and changing social norms demand the culture and organisational structure of many older businesses undergo a dramatic transformation or these companies are destined to fail.
At least 40% of all businesses will die in the next 10 years… if they don’t figure out how to change their entire company to accommodate new technologies. John Chambers | Former CEO, Cisco System
Common Digital Technologies
Cloud computing is one common digital technology that has helped a growing number of data-driven companies succeed by better knowing and serving their customers. Well-known companies like General Electric, Kroger, HotelTonight, eBay, Meals On Wheels and Fitbit have benefitted from using cloud computing. Hyperconverged Infrastructure, automation, the virtualisation of servers, storage and networks, DevOps, Software Defined Data Centres and the Internet of Things (IoT) have helped both small and large companies in diverse industries improve the quality of both customer experience and their unique services.
How Digital Technology Transformation Can Help Your Business?
Transforming businesses digitally has several proven benefits. Smart technology along with connected systems enhance business efficiency. If, at every stage, businesses thought digitally, it would increase productivity and allow companies to achieve more with less. This includes adopting proper strategies, such as using automation to remove employees from hazardous situations. When companies carefully align digital technology with their business and environmental goals, the results are compelling. Productivity gains, significant cost savings and improved energy management, to name only a few.
Transformation Across All Sectors
Digital technology enhances customer experience and creates new business models. Companies must understand how the right digital strategies can transform all sectors of their businesses. Proven performance benefits include greater energy efficiency through integrated and connected technologies like edge computing, analytics, data insights, sensors, app-based controls and smart machinery. Maximised productivity through IoT-enabled tracking, automated production lines, data analytics as well as remote diagnostics and predictive maintenance can reduce maintenance time and cost.
Fully Digitised Intelligent Platforms
Embracing fully-digitised, intelligent platforms can help businesses with sustainability targets, dramatically cut emissions and protect the environment. The right digital strategy can cut a company’s carbon footprint in half, deliver substantial operational savings, increase shareholder value, improve brand image and strengthen customer loyalty. Digitisation also usually increases return on investment within five years. Digital technology also enhances worker safety while boosting efficiency in several industries including industrial, mining and manufacturing.
Vision and Strategy First
Digital transformation isn’t a magic bullet; enjoying its many benefits requires proper planning and an effective strategy. Digital technology provides companies with greater control and enhances production processes, staff capability and efficiency and creates the butterfly effect that helps companies achieve even greater value. Achieving this transformation requires creative, highly experienced, knowledgeable, senior business and technology teams with digital technology expertise to provide the digital technology upgrades that will improve performance.
Digital technology improves operational efficiency by 40% and delivers products to the market 36% faster. Over 56% of CEOs claim that digital improvements lead to revenue growth. This is logical, as most consumers regularly make purchase decisions on mobile devices. Companies today must transform digitally or, ultimately, perish.