Digital transformation is one of the most exciting concepts in business right now. However, it’s also one of the most confusing concepts to emerge in recent years. While most businesses agree that digital transformation is key to evolving within their given markets, many don’t quite have a firm grasp of what it is and what it means for their organization.
According to CIO, digital transformation entails “the acceleration of business activities, processes, competencies, and models” in a way that allows businesses to strategically harness digital technologies to drive change and facilitate improvement. This process is also reliant on organizations’ ability to keep up with (or surpass) innovations in digital disruption. As technology becomes an increasingly central part of society, businesses that fail to pursue digital strategies run the risk of falling behind their competitors and the business atmospheres that are evolving around them.
Moreover, a 2017 report from Market Research Engine estimated that the global market for digital transformation will grow to a staggering valuation of $462 billion by the year 2023. Your organization can’t afford to fall behind by failing to take advantage of the numerous ways that digital transformation can improve your business. As you get started with this process, here are a few crucial things that you should know about digital transformation:
Organizations in all industries are pursuing digital transformation
Digital transformation is already making a big impact on businesses in nearly every vertical. In its “Digital Transformation by Industry” survey, IDC found that more than 67 percent of companies believe their competitors will leverage digital capabilities to gain an edge within their given markets in the next few years. The companies surveyed belong to the health care, retail, process manufacturing, public sector, and discrete manufacturing and wholesale industries. These industries, which exist closer to consumers on the value chain, are experiencing more technological disruption than other areas of business.
Organizations in these sectors are using digital transformation to almost countless ends. Retailers are looking to deliver better experiences to their customers and generate loyalty to their brand, while medical centers are leveraging digital services to make the check-in process more seamless than ever. Digital transformation is applicable within every vertical. It is up to your company to determine how it can benefit from it.
Choice of technology is key
There are numerous technologies that you can use to facilitate digital transformation at your company. You should not, however, simply deploy every piece of technology that you see other organizations adopting. The tech that you choose should help you meet certain goals or improve specific processes.
In its 2018 State of Digital Business Transformation report, IDG Communications identified a few of the most popular technologies that companies are using. Big data/analytics and mobile technologies made up the largest volume of tech adoption, at 58 percent and 59 percent, respectively. The former could be the right fit for your organization’s digital transformation strategy if you are looking to boost your efficiency and improve your decision making. The latter is more crucial to the modern enterprise because it will allow you to capitalize on the growing prevalence of mobile devices in the lives of consumers and employees alike.
Cloud computing is another digital technology that has moved to the forefront of the digital transformation strategy in recent years. As recently as 2016, 86 percent of organizations believed that the cloud was an important facet of their digital transformation efforts. However, fewer than 10 percent of these entities had fully realized their cloud objectives at this time. By 2018, adoption rose to 53 percent in the private cloud and 45 percent in the public cloud. No matter which deployment style you choose, you will gain access to cutting-edge services that will bring your existing systems into the modern era.
You can’t proceed without a strategy
Digital transformation won’t happen in a day. You will need to go in with a solid strategy if you want to make real, effective changes within your organization. According to research from Harvard Business Review and the Genpact Research Institute, only half of companies have a comprehensive digital strategy. Many organizations approach digital transformation without a plan of attack, instead opting to deploy new digital platforms without a goal in mind. As a result, they often exceed their budget and, ultimately, abandon the project.
As such, your digital transformation strategy should start with an assessment of your objectives. Look at the various areas that you could improve by introducing new technology. Whether you are looking to save money by improving your business processes or revolutionize the customer experience, you must build your digital transformation strategy from a strong, goal-driven foundation.
After identifying your objectives, you should gather a team that will be able to carry out your vision. To this end, you should involve individuals from numerous departments, including IT, administration, and front office.
You may come up against some barriers along the way
As with any organizational change, you may encounter some roadblocks on the path toward digital transformation. Facing change is one of the biggest obstacles that you must overcome during this journey. You must make change management an integral aspect of your digital transformation process to ensure that both your organization and your staff are prepared for such a major overhaul.
It may also be difficult for your organization to experiment with new technologies quickly enough to facilitate digital transformation in a timely manner. In fact, more than half of executives believe that slow experimentation has impeded the success of their transformations. Part of this obstacle stems from an aversion to change, which can influence companies to stick with familiar legacy systems. Your organization must be ready and willing to experiment with innovations to keep up with ever-developing technologies.