What is Digital Transformation?
Digital transformation is the integration of digital technology in day-to-day business processes. The motive behind going digital is to make the processes more effective, efficient, and productive.
In short, digital transformation is a bridge connecting the expectations of digital customers with what analog businesses are already delivering.
Digital transformation is/was never about technology disruption, but it’s been about creating and adding value. Organizations started offering impeccable customer experience and started enjoying the ultimate power to evolve and adapt only due to digital transformation.
Organizations became more agile, people-oriented, customer-centric, and even more efficient with digital technology. Besides, digitally transformed organizations prepared themselves to leverage cloud computing, big data, Internet-of-Things, Artificial Intelligence, etc.
Why Digital Transformation?
Howard King, in his Guardian post, says “Businesses don't transform by choice because it is expensive and risky. Businesses go through transformation when they have failed to evolve.”
Yet, many businesses are concerned about whether the digital transformation is right for them or not. Some think they are already behind and some think they are too late to adopt it. However, each business out there needs to understand that digital transformation speeds up business processes five times than the traditional business model. In this blog, we explore the benefits of digital transformation to a business and its workforce.
Here are some reasons to understand why every business needs to embrace digital transformation
To transform the customer experience
Technology is a global obsession now. The increasing smartphone and internet penetration rate made people smarter and their life easier. Now, people want solutions to their problems fast.
Digital transformation has brought customer experience to the heart of organizations. Therefore, the primary focus of adopting digital technology is to enhance the customer experience.
The majority of organizations started planning their business strategies in and around better customer experience.
When you opt for digital transformation you transform your core business operations.
Customer journeys are tracked and can be easily monitored in a digitized environment.
It enhances the speed and agility of getting digital insights.
The digital environment makes the customer journey transformation more agile.
To get data-based insights
One of the major reasons to adopt digital transformation is to track customer data and monitor customer journeys in the digital environment. The metrics and data thus obtained are valuable for businesses in optimizing their marketing, sales, and process strategies to obtain better results. Businesses are using these insights to cut costs and increase revenue.
The data-driven insights are helping businesses to personalize the customer experience at its core. The structured and unstructured data thus obtained is proving helpful to get real-time feedback, enhance agility, and optimize relevancy. Above all, it helps in making informed decisions.
To enhance inter-departmental collaboration
Change is fearsome for many. The digital transformation is a process wherein the entire organization shifts from its traditional work frame to an interconnected digital framework. At times, the entire process becomes daunting from top leadership to new employees. Therefore, aligning strategies and addressing core company culture becomes important.
Digital transformation brings every business operation and the siloed departments under one roof. It is an opportunity to unify the workforce and departments. Remember strong communication is the key to a successful transformation.
You need strong leadership and full-proof strategies to break the silos between employees. Digital disruption leaves behind social divides so that the workforce starts learning and working together resulting in increased productivity.
Digital congruity lays the foundation of seamless digital transformation. All departments come together to create a productive working environment and to form a strong working culture leading to an optimistic transition.
To enhance agility and innovation
Agility is the ability to improve and develop continually and speedily; especially in the digital processes. Many industries regard Innovation highly. Therefore, more than 68% of companies expect agility as the prime factor to adopt digital technology.
The ever-changing landscape of digital technology provides no time to adapt and evolve; hence, agility and innovation are at the core of digital transformation.
With digital technologies, there are always new tools, new apps, new trends, and new resources. Being digital gives you the capability to be adaptable, innovative, and agile so all these changes could be accepted in minimal time. Therefore, enterprises are always on their toes to innovate and evolve.
To adapt skills and knowledge
Evolving technologies need evolving skills. Failure to fill the gap between demand and supply results in lagging. Being aware of skill sets in demand, how to develop them, and where to find them makes it easier to face the change.
Here are some skills forming the foundation of digital transformation
Artificial Intelligence
Machine Learning
Cloud Computing
Big Data
Augmented Reality
DevOps
Automation
Due to the increasing demand for new skillset, many companies think that digital transformation is a costly endeavor. In reality, it is a smart investment. But it is advisable to have a concrete plan for combating the digital talent and evolving skill set gap.
One of the great ways to address this gap is by allowing employees to enhance and excel in different skills. By equipping in-house knowledge to nurture the growth you take the first step towards gaining a competitive edge in the digital business world.
To unify business processes
Interaction and connection are the main advantages achieved by businesses due to embracing digital technology. With interconnected processes, people find it easier to communicate and connect with different business stakeholders.
It’s not just about the customers or employees, but it is about every entity involved in the business. When different processes, operations, employees, customers, stakeholders come together on the same platform it rewards businesses in terms of growth and ROI. Connecting with customers results in great customer experience and connecting with other employees from other departments makes the business process more efficient.
Digital Transformation in Five Easy Steps
Transforming a company from traditional to digital is a tricky process. It is easy when you create a digital transformation strategy first and follow it to witness the metamorphosis.
Although there is no checklist or comprehensive strategy to follow, it is the job of business leaders to design and develop a strategy based on your business availability and requirements. However, while designing a strategy, business leaders must ask executives, tech leaders, and change managers to participate and give their opinions.
To simplify your efforts, here is an outline of five basic yet important elements that will help you design a killer digital transformation strategy.
Evaluate and analyze the current state
Before you start designing a strategy it is mandatory to assess where you currently stand. Evaluate legacy systems, applications. Analyze the need to adopt digital transformation and associated change.
Ask yourself if you could meet the current demands? How digital technology will help you achieve growth? What business process will assist you in meeting company goals? Answers to these questions play an important role in understanding the need for digital transformation and to devise a strategy.
New technology does help businesses to remain competitive and efficient, but keeping a holistic approach towards technology as a tool is important.
The technology adoption is not just adding some machines and computers in the infrastructure, but it is a transformation that will change the way you will do business in the future.
Budget allocation and finding the right technology
Allocating a specific budget is the major step in designing a digital transformation strategy. The IT team, Executives, and Finance team must agree upon a certain budget to initiate the process.
While allocating a budget you should have a wholesome approach. You need to cover more than transformation costs. You need to allocate a separate budget within the digital transformation budget for employee training, support costs, added infrastructure, and loss of temporary productivity (you might face it due to sudden change).
Choosing the right technology is the most painful. You need to research, consult, and experiment with different technologies to find the best and most suitable tools according to your needs. Proper due diligence will lead you to the right technology that is fully capable to address the major needs of your organization.
Whatever technology you choose, ensure it is scalable and offers enough scope to accommodate the evolving and innovative changes. Good knowledge of how the process transition, support, and implementation helps in making the digital transformation smoother and speedier.
Employee training
The need for skilled labor is the most daunting task of the entire digital transformation process. Planning a strategy to hire and onboard employees with required skills must be on the top of your agenda.
Design a training strategy that is most effective and suitable for employees. If possible think beyond typical classroom training as most of the employees will recoil. Embrace digital teaching that will not interrupt the workflow but keep employees engaged and motivated to learn the seamless use of enterprise software.
Contextual learning with real-time pop-ups, help guides, and on-screen guidance helps a great deal in speeding up training and learning digital technology by actually completing tasks.
Embrace open feedback culture
Digital transformation is a big change and your leaders as well as employees are making a big leap towards adaptation. Ensure a solid change management infrastructure is in place to accompany the transformation. Without such an infrastructure you might face employee frustration, resistance, and disengagement.
Open feedback is a process that allows everyone in the organization to be vocal. Their opinions are valuable to succeed in digital transformation. Their opinions and suggestions help in creating and optimizing a digital transformation strategy that is effective, efficient, and acceptable.
Ensure the process is unrestricted
Digital transformation is a process that goes on continuously, It is open to evolution, innovation, and adaptation. Since many updates are frequent and automatic you need to ensure that the process is open-ended to accept these changes.
To manage high productivity and evolving skillset, companies need to support and structure ongoing training. It enhances the usability and productivity of both employees and technology.
As you opt for digital transformation keep your eyes and ears open for all the updates and developments from employees as well as the technology side.
Conclusion
Enterprises have understood the importance of accepting digital technology and are either moving or making plans to move in that direction.
According to IDC’s Worldwide Semiannual Digital Transformation Spending Guide, the worldwide spending on technologies and services for enabling digital transformation is expected to reach $2.3 trillion in 2023. It also states that the total spending on digital transformation will expand steadily from 2019 to 2023 achieving a five-year compound annual growth rate of 17.1%.
Opting to stay outside the boundary was liberty for many businesses in the past. But, today the game is different and players are more skilled and honed. We are in the middle of the digital revolution; so businesses investing, adapting, and excelling in digital technology will win the game. Ask yourself, are you ready to embrace digital transformation?
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