What is a Digital Transformation for Business?
Digital transformation is the fusion of digital technology into all sides of the industry, basically changing how you use and convey to customers. It is also a cultural change that needs a company to frequently challenge the social or political issues, experiment and get comfortable with failure. Through digital transformation, organizations can convert tangible goods into digital goods to meet the requirements of their customers. In the words of Mark Foster, Senior Vice President for IBM Services – “It’s an opportunity to leverage these new technologies to really change the way you organize your business, to really redefine your strategic advantage and your competitive advantage. But it is also an opportunity to be swamped by the chaos of a thousand shiny objects as each team tries to imagine what it could do with the technologies.”
In this blog, we look at all the aspects of digital transformation. Let’s get started.
Why does Digital Transformation matter for business?
- More significant cost reduction – Digital tools and technologies have already had an extreme impact on the global economy.
- Improved financial performance and profitability –Especially, companies implementing technology solutions have experienced 39% growth in revenues and have reduced their time for market by 21%.
- Increased employee productivity – Employees become more efficient, take very less time to make decisions and are more satisfied.
- Better customer experience – When Enterprises know the problems customers are facing, they plan customers experience better
Depending on any organization or industry, a digital transformation may have a different meaning. Each industry has a specialized requirement for digital transformation.
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In short, it is the integration of information, using a computer and mobile technologies into a company’s overall business strategy. The integration of these technologies provides an efficient working platform for employees. Additionally, digital transformation helps to convey a better experience for customers and improve long-term relationships.
What is the Digital Transformation framework?
Reproduced components of Digital transformations are below:
- Staff and customer engagement
- Digital business strategy and culture
- Workforce enablement
- Digital technology integration
- Customer experience
- Data and analytics
Staff and customer engagement: If engagement with stakeholders is wrong, it leads to resistance.
Digital business strategy and Culture: If strategy and culture are not right, it leads to the digitization of services.
Process and Innovation: Without these, confused action occurs.
Data and analytics: It is used for insight and evidence-based decision making.
What are the Benefits of Digital Transformation?
Almost companies are shifting towards the process of digitalization nowadays due to their profits. The growth of computer and mobile technologies has made it mandatory for businesses to go digital.
When some organizations can convert goods and services into digital form, many are drawn into the execution process challenges.
- Convey a better customer experience– As a result, advancement in technology helps companies to provide a better and consistent involvement in fulfilling the needs of customers. Advancement in technology has increased the way companies communicate with their customers.
- Improves the skill set of employees – As companies continue to adopt new technologies, employees will be required to update their skills to meet the changing technological environment.
- The best way for data collection and analysis – It is also a business benefit of digital transformation is the online data collection and analysis. It helps to further enhance business strategies by studying the online habits of the consumer.
- Makes your company more profitable – Digital transformation, in many cases, affects other features of your business positively. If the process implementation is successful, the chances of increasing revenue are very high
- Keeps the velocity of competition – Being able to compete is what ensures the endurance of a company. With the prevalent world of digitization and continuous transformation of the business environment, the competition will continue to grow.
So, by transforming your company into a digital business, you are keeping the velocity with the competition. And this will have a favourable change in everything that revolves around your business.
What are the Challenges to a Successful Digital Transformation?
Digital Transformation is a buzzword, which has been around for some time now. Yet a worldwide survey* of 196 organizations by Gartner, Inc in 2018 showed that “91% of organizations have not yet reached a transformational level of maturity in data and analytics, despite this area being a number one investment priority for CIOs in recent years”.So what are the challenges that an organization face that while adopting digital transformation? Let’s find out.
Organization’s Resistance to Change – Changes are harsh; it is a human tendency to resist changes. But from history, we need to take the lesson that change is the only constant. Kodak didn’t adapt with time and even though they invented the digital camera, but it was the internal resistance to change that led the company’s collapse.
Solution: The organizations seeking to move ahead with digital transformation, need to build an environment guided by Management, like Enforcement, and a clear strategy to execute and manage the transition. The workforce needs to understand that digital transformation is for improving all the elements of their workflows.
IT Resources concern – The organization can decide on the strategy and everything else, yet without resources, nothing is possible. Resources include finances, infrastructure and importantly, digital workforce.
Solution: Roadmap to digital transformation should include resource planning which provides for estimations for finances and IT resources. Human resources should then be equipped to find the right talent. And all the other departments are involved in bridging the digital skills gap.
Keeping up, Being agile – Business’s digital transformation is not a one-time activity. The organization needs to keep innovating and keep up with the market changes to serve their customers well. The digital transformation strategy has to include a plan for agility.
Solution: The agility needs to be built from the ground up; microservices, open APIs, Application release automation for continuous delivery, continuous integration and Agile teams are some of the parameters that help build agility.
What are the steps to successful Digital Transformation journey?
Develop Goals & Strategy: Create some strategic goals when a company wants a new strategy. When companies create their goals, they directly find out what they see as the result of their business efforts.
Business Architecture: It is useful to clarify Goals and Strategy. It provides priority capabilities and assesses capabilities. Better to find out expected outcomes.
Develop Roadmap: It is a part of portfolio management. A roadmap is a strategic plan that defines a goal or expected outcome. It includes the significant steps also like application and other assets, possible scenarios, roadmap scenarios, and so on.
Agile delivery of solution: Choosing an Agile delivery solution is best for the organization but choose should depend upon the journey of your organization. It mainly focused on collaboration, communication, and iteration. If we make are projected by using agile delivery of a solution, then Business rule and process also need to follow. In this case, user requirements are also necessary.
Digital transformation works for enterprises because their leaders drive the change, and they go back to their basics. Leaders focus on their employee’s mindset and inculcate changes in their organizational culture. Leaders did not decide on the digital tools and how to use them; first, they make cultural enhancements and technology come second. Organization’s vision drives the technology and not vice-versa.