DIGITAL TRANSFORMATION – WHAT EVERYBODY ASKS
Digital transformation is a must for every business out there, whether you’re a tiny startup or a massive enterprise. You can’t escape the message—it’s everywhere! Keynotes, panel discussions, articles, and studies all hammer home the point that if you want to stay in the game and stay relevant in our digital world, you need to transform. But here’s some food for thought:
- What does digital transformation even mean?
- Is it just a fancy way of saying move everything to the cloud?
- And what do we actually need to do to make it happen?
- Do we hire some new folks to handle it or bring in a consulting service?
- Which parts of our business strategy need a makeover?
- Most importantly, is it all really worth the trouble?
These are the burning questions that leave many business leaders scratching their heads.
WHAT IS DIGITAL TRANSFORMATION?
Digital transformation is a tricky concept to nail down because it varies from one company to another. But if we had to give it a general definition, we’d say it’s all about integrating digital technology into every nook and cranny of a business. This leads to big changes in how things are done and how customers are served. And it’s not just a tech upgrade but a whole mindset shift. To pull it off, companies need to constantly question the way things are done, take risks, and even embrace failure. Sometimes, it means ditching old-school processes that have been around forever in favour of fresh approaches that are still taking shape. To get started on digital transformation, it helps to have a clear problem to solve, a golden opportunity to seize, or an ambitious goal to strive for. Jay Ferro, CIO at healthcare company Clario, explained:
“The “why” of your organization’s digital transformation might be around improving customer experience, reducing friction, increasing productivity, or elevating profitability, for example. Or, if it’s an aspirational statement, it might revolve around becoming the absolute best to do business with, utilizing enabling digital technologies that were unavailable years ago.”
Jim Swanson, CIO of Johnson & Johnson, also tells us why digital transformation is much more than an enabler or new business model:
“In the centre of it all is leadership and culture. You could have all those things – the customer view, the products and services, data, and really cool technologies – but if leadership and culture aren’t at the heart, it fails. Understanding what digital means to your company – whether you’re a financial, agricultural, pharmaceutical, or retail institution – is essential.”
In short, ‘digital’ can be a messy word, a love-to-hate term. It can mean AI to one person, going paperless to another or data analytics to data scientists. As such, company leaders need to be aware of this reality and frame digital transformation in a context relevant to their operations and culture.
MAKING THE CHANGE
There are many ways to go about digital transformation, and each business will experience a unique journey. For example, a company might bring in AI or cloud computing to make their customer experience even better. Or they might totally change up their supply chain to make the most of machine learning. Some companies can even predict what products customers will want in a few months and adjust their production to meet the demand. No matter what, starting a digital transformation journey means you need to put a different business thinking cap on. It’s a chance to totally rethink how things are done in your company, starting from scratch in many cases.
DIGITIZATION AND DIGITALIZATION
The concepts of digitization and digitalization are closely tied to digital transformation.
- Digitization involves converting analogue information and data into a digital format. This can be done by scanning photos or documents and saving them on a computer or other digital devices.
- Digitalization is when you use digital technologies to change how things work in a business. This could mean teaching employees how to use new software that helps speed up product launches. Digital transformation, though, is bigger than just specific projects. It’s when the whole organization gets affected by changes and moves into the digital world.
For most companies, digital transformation means ditching old-school thinking and embracing a more collaborative and experimental approach. It’s all about trying new things and working together to find better solutions. This not only improves the customer experience but also sparks innovation among employees and drives company growth from the ground up.
CHANGING YOUR BUSINESS STRATEGY
Back in 1996, a Harvard lecturer named Michael Porter wrote an article in Harvard Business Review called What is Strategy? He made a point that’s still relevant in our digital world today saying that while being good at operations is important, but it’s not the whole picture. The problem is, the techniques used in operations are easy to copy, so they don’t give you the edge. The digital economy is booming! Everything from how we find customers, suppliers, products, and services, has changed thanks to the digital revolution. Anything that can be turned into digital format is getting digitized. But the strategy of simply digitizing what already exists isn’t going to cut it anymore. Many businesses make the mistake of thinking that having a to-do list is a strategy. They confuse operational plans, resource plans, or money investments as strategic moves. While those things are important, they’re not the real strategy. A digital transformation strategy is like a game plan for getting a business up to speed in the digital world. Thanks to data, we can spot new opportunities way easier. But here’s the thing: to really take advantage of the latest tech and jump on new opportunities quickly, we need to change the way we work. It’s all about being adaptable, skilled, and determined to make the most out of the digital era. Greg Satell, tells us in his book Cascades: How to Create a Movement that Drives Transformational Change:
“True transformation isn’t top-down or bottom-up. It’s side-to-side. Change never happens all at once and can’t simply be willed into existence. It can only happen when people truly internalize and embrace it. The best way to do that is to empower those who already believe in the change to bring in those around them.”
That said, here are seven tenets of a good digital transformation strategy:
- Get everyone on the same page about why digital transformation is important.
- Be ready for a shift in company culture.
- Begin with small but strategic initiatives.
- Plan out how technology will be implemented.
- Look for partners and experts who can help.
- Collect feedback and make improvements along the way.
- Scale up and fully transform your organization.
IS IT WORTH IT?
If you want to figure out whether an investment is worthwhile, you have to compare what you put in with what you get out. The same goes for digital transformation. You need to assess the benefits that come from going digital and weigh them against the time, effort, and money you invest in the process. Let’s explore some of the advantages you can expect when you decide to invest in digital transformation.
Data-based insights – Entrepreneurs need data to predict trends, understand what customers want, improve their products and services, come up with marketing strategies, and make smart decisions. But data is only useful if you analyse and interpret it correctly. That’s where digital transformation comes in. By ditching old-school methods of collecting and processing data and using a centralized platform instead, you can turn your data into real, actionable insights.
Competitive edge – it’s crucial to keep an eye on your competitors and try to outshine them. But when you’re in a crowded market, finding the perfect combination of strategies and techniques to stand out can be a real challenge. Luckily, digital transformation is here to save the day. It helps you level up your operations and deliver top-notch products and services to your customers.
Customer interactions – As your customer’s needs and wants keep changing and increasing, it’s becoming tougher to meet their expectations and give them the experiences they’re looking for. Since customer interactions can make or break your business, it’s critical how you handle them. Digital transformation is all about making those customer experiences smooth and seamless. If you do it right, you’ll keep your current customers happy and bring in new ones to your business too.
Increased efficiency and productivity – You might feel like your business is doing well, but there’s always space for improvement. Going digital allows you to modernize and enhance all your business processes, minimizing the chances of human errors and paving the way for future growth. When you combine all these factors, it leads to improved efficiency and productivity, which ultimately means more revenue for your business.
AUTOMATE WITH ME
Automation is a fundamental component of digitalization and digital transformation. I’ve been in the cybersecurity and IT support business for almost 20 years. While I might have cybersecurity and risk mitigation in my bones and blood, I’ve also moved on with the times, increasingly seeing why businesses need automation and digital transformation. Let’s get together soon. You’ll quickly see how digital transformation can rock your business culture, revolutionise the way you work, and keep your customers and team happy.