How to Perform Business Digital Transformation?: In this age of Industry 4.0, there is a significant need for digital transformation within businesses.
Many publications, research, and panel debates on the problem of maintaining relevance and competitiveness in an increasingly digital business world have focused on digital transformation, sometimes known as DT or DX for short.
The hype train is virtually at capacity at this point, and it can hardly manage to keep on its tracks. Therefore, many businesses go right into their digital transformations without making the necessary preparations, seizing digital technology in a hurry and speeding through the process, which ultimately results in outcomes that are counterproductive. Let’s take a more in-depth look at DX, as well as the best way to approach it.
What Does It Mean by Digital Transformation?
The process of integrating digital technologies into all aspects of a business, which results in fundamental changes to the way that the firm runs and how it provides value to its consumers, is what is referred to as digital transformation.
There is a good reason why this sounds so hazy: the specific process of digital transformation will vary greatly from business to business, which makes it extremely difficult, if not impossible, to establish a definition that is applicable to all DXs.
The investigation of and use of new digital channels and technology may need making significant adjustments to the business models and business processes that have served as the foundations of firms up to this point. Therefore, in order to guarantee that the business will emerge stronger than it was before, it is essential to devise a comprehensive and carefully considered strategy for digital transformation.
Things to keep in mind regarding digital transformation
Over the course of its existence, DX has been the subject of a great number of urban legends. Here is a collection of the most popular ones, along with the truth that contradicts them:
1. You couldn’t be more wrong here, as the successful execution of digital transformation demands leadership from the very top of the organisation. The bottom-up operation is how it works.
2. The digital transformation gives up tremendous prospects in various domains like employee leverage, productivity, and efficiency. The primary area that is impacted by DX is the customer experience.
3. We are able to push digital transformation in spite of our information technology, but the interaction between business and IT is essential for digital transformation, and it needs to be enhanced for digital transformation to be effective.
4. Another major misunderstanding about digital transformation is that it is only relevant for technology and business-to-consumer (B2C) organisations. This is not the case, as DX presents potential in all sectors and is crucial everywhere.
5. We can wait with DX in our industry and see how the digital world develops; on the other hand, the more you wait, the larger the gap will become between you and the digital leaders in your business; we can wait with DX in our industry and see how the digital world develops; If you wait too long, you won’t be able to get back up to speed in time to catch up to them.
6. The way that DX is approached varies depending on the sector a company operates in as well as the company itself. Despite the fact that the process itself is almost always unique, all of the leaders in DX share a common DNA, and the path to digital transformation shows common characteristics regardless of sector.
Why is digital transformation So important?
To put it plainly, going digital is absolutely necessary in order to maintain a presence in the market. We are well into the digital age, and anyone who does not adopt digital technology (such as artificial intelligence and machine learning, the internet of things, and the modernization of legacy systems) will eventually fall off because they will not be able to meet the expectations of their customers. Or failing to execute the digital business solutions that are the most effective.
If a company’s digital transformation initiatives are successful, the business may see growth or even be given a second chance in the market. Examples? There is no need to look very far; LEGO has successfully bridged the gap between the analogue and digital worlds by investing in games designed for mobile devices.
They are also heavily engaged in research and development with cutting-edge technology such as three-dimensional printing, sensors, and complex components that can be managed through the use of a specialised software.
Main areas of digital transformation
The process of digital transformation has been investigated a great number of times. The findings of the research highlight critical components of effective digital transformation projects. The four most important ones are IT modernisation, operational digitization, digital marketing, and new activities, and they can be summarised as follows:
The process of digital transformation typically begins with the upgrading of an organization’s existing information technology infrastructure. This may involve activities such as installing new software, upgrading hardware, adopting new technologies, and establishing data clouds and mobile infrastructure.
These kinds of digital efforts will not only bring your company’s information technology and communication platforms up to date, but they will also save your firm money on maintenance costs and boost employee happiness and productivity.
And all of this is possible because we simply upgraded to more modern technologies. However, keep in mind that the successful installation of new technologies requires patience as well as IT architects that have experience.
Modernization of IT can also be done much later on down the road; successful businesses continue to invest in their IT infrastructure for a long time after their DX has been finished. This ensures that existing processes are continuously improved, as well as the overall quality of the customer experience and the productivity of the workforce.
You will be able to achieve streamlined, efficient, and rationalised procedures once you have digitised your business activities. This critical phase, which is typically carried very close to the beginning of DX, can take a variety of forms.
Changing from analogue work to its digital equivalent is, of course, the one that is the least complicated of these options. It’s possible that the reorganisation of your company needs to go much farther, such as combining multiple divisions into a single entity.
The digitization of business processes is something that may be done in stages, first beginning with the fundamentals and progressing to more complex steps as the organisation develops.
Why is it important to complete this step? Your organisation will fall behind other digital transformation leaders who are more efficient if the operations at your company are not streamlined and fine-tuned. In addition, the accurate digitization of processes brings up more options for transformation.
An excellent illustration of this concept is the practise of fostering the development of an entire ecosystem of items by merely enhancing a company’s eCommerce platform and logistics, as well as by adding products sourced from other shops to the company’s offering.
This procedure will, of course, involve some time and some technology; nevertheless, if it is carried out correctly, it will result in significant cost savings, increased customer satisfaction, and more efficient use of time and human resources.
Using digital technologies to sell products or services online, to profile and acquire new customers, or to increase brand awareness is part of “going digital” with your marketing strategy. This particular field diverges from the others in that its emphasis is placed on a rather specific subject: namely, the use of digital tools for communicating with and making sales to clients.
You will need to make investments in particular resources such as customer data collection and analysis, tools for developing an omnichannel presence (such as artificial intelligence, chatbots, and automatic responders), and other similar resources.
Utilizing digital channels effectively allows for the creation of viral campaigns (including geo-targeted ones), the establishment of digital markets, and other similar endeavours. The previously mentioned artificial intelligence can be of assistance in analysing the actions of customers and adapting the activities of the marketing team to the patterns that are discovered.
By digitising your marketing, you will be able to lower the expenses associated with the acquisition of new consumers, obtain higher returns on the money invested in marketing, improve the quality of service you provide to existing clients, and acquire new customers.
And finally, but most certainly not least, the digital transformation enables brand-new possibilities for business expansion. Because the tactics that lead to new business models, services, or products as well as the creation of an entirely new business ecosystem can be extremely disruptive, your company needs to be well-established before you can fully reap the rewards of this sector.
Businesses that have just undergone digital transformation or those who are still in the process of DX lack the resources and digital maturity to properly embrace such daring measures.
Do the potential benefits justify the possible downsides? Given that the so-called Key Performance Indicators, often known as KPIs for short, can become somewhat subtle or even hazy in this context, it is without a doubt a matter of personal preference.
In a nutshell, this entails coming up with a solution to a significant problem faced by customers and then making money off of that answer. That doesn’t really sound like something that would be appealing, does it? Because of this, any new business endeavour must to be preceded by an in-depth analysis of the market as well as the capabilities of the company.
Strategy to employ to guide your Business, through its digital transformation?
- Why do we need to transform?
- What do we need to transform?
- How can we transform?
When you have these, you will have a firm platform on which to explore further issues, such as long-term goals, necessary skills and knowledge, who should be involved, potential external aid, gaining insights, and other similar themes.
Make the improvement of security a top priority once your organisation has developed its DX business plan and has begun the transformation process. Switching to remote work can reveal gaps in security that can be cruelly exploited by cybercriminals.
Digital organisations that are in the process of transforming or that have just recently started operating online are particularly susceptible to assaults. Consequently, investing in reliable security measures (including hardware and software) ought to be at the very top of the list of priorities. This is especially true for large companies that work with private digital information.
Putting an emphasis on the hybrid work model is yet another beneficial approach. A flexible work paradigm provides considerably more opportunities than simply working remotely or on-location; it can be tailored to the requirements of each individual employee, which ultimately results in increased productivity.
However, keep in mind that in order to become a genuine long-term solution, a good hybrid work structure that is also efficient takes a significant amount of planning. A hybrid work system will undoubtedly be worth the effort because it considerably broadens the horizons of your company. For instance, it will expose larger pools of possible employees because it will allow for asynchronous work across multiple continents.
When it comes to the “don’ts,” the first and most important thing to keep in mind is that you should never launch a new project without first consulting data analytics. Each and every company choice, and particularly those pertaining to DX, needs to be supported by reliable data.
Your resources will be stretched thin without the work of data scientists and analysts, and you will have a greater likelihood of experiencing digital disruptions as a result. Your chances of success are much increased even if you only have a small amount of data supporting (such as only 4 KPIs that have been developed).
While we are on the subject of “don’ts,” it is a poor idea to underestimate the experience that the customer has. Because customers and clients are the focal point of any business strategy, the experiences they have should play a significant role in any digital revolutions that take place. These two are frequently intertwined with one another and have a substantial impact on one another.
The process of digital transformation can be a lengthy and challenging task, but if it is carried out properly, it has the potential to dramatically improve your company’s standing in the industry and reinforce its position in the market. DX is not something that should ever be done in a hurried manner or without prior careful consideration. Do not be afraid to seek the assistance of an experienced DX consultant if you want to make certain that the digital transformation strategy you implement will result in the most successful possible conclusion. Such people can be found working at Silicon Cities, which is a professional advice and consulting organisation with its headquarters in Sydney.