Digital transformation in business –
Why digital transformation is important
The reasons for embarking on digital transformation are different from one business to another. The common denominator, however, is the fact that digital transformation is needed to ensure the continued survival of every business.
Change is the only constant in the business world. Every company needs to evolve to survive. Evolution translates to more efficient processes and new ways to serve customers. This need for continued evolution is the reason why most businesses turn to digital transformation. They do not do it to be fashionable or because it is exciting. They undertake this expensive and risky move because they deem it necessary for their survival.
The need for constant evolution grows more pressing and acute as the world speeds up. According to Vanguard CIO John T. Marcante, back in 1958 American corporations included in the S&P 500 index remained in that index for an average of 61 years. In 2011, that same average was just 18 years. Nowadays, the index revises its constituents every two weeks.
Digital transformation is a long-term investment. More and more executives are recognizing this fact. To savvy executives, digital transformation offers opportunities instead of hurdles.
There are three choices business leaders can make concerning digital transformation:
- Fall behind
- Keep up with the changes
- Emerge as a leader
Reasons for digital transformation
According to Salesforce, the reasons for digital transformation in business are numerous.
- Growth and scaling are two of the most important factors. Restructuring the business to this end is one of the prominent drivers of digital transformation.
- Proper customer engagement. In the digital age, the attention span of the customer has contracted. Consumers are more informed and more demanding. Businesses have to meet these new needs.
- The way digital transformation shapes market forces. Existing markets are threatened by new, agile competitors. At the same time, digital transformation has created new industries.
- The integration of new technologies. The internet, social media and mobile have all greatly impacted markets. Machine learning, blockchain and the Internet of Things are likely to exert similar effects.
- Changing the culture of the company. As scrive.com’s cases illustrate, a culture change through digitalisation is often a significant step forward.
- Ensuring the future competitiveness of the company. Or, as many executives call it, “future-proofing” the operation. Embracing digital transformation is a long-term investment, as mentioned. If done properly, it does lend the business a future edge.
- Reducing operational complexity and improving processes. This is the most direct and immediate benefit of digital transformation for business.
- The digitalisation of every aspect of life forces digital transformation on the level of businesses. The world as a whole and the economy is increasingly digitalised. Businesses that refuse to adapt will be out of place in the economy of tomorrow. Many of the world’s leading economies are already spearheaded by digital businesses.
Risks and benefits of digital transformation
The benefits of digital transformation far outweigh its risks. Most of the risks entailed are tied to missing out on digital transformation.
Some of the benefits are:
- Improving UX, including offering a personalised and connected experience
- Ensuring the scalability of processes
- Eliminating inefficiencies, improving employee satisfaction and retention
- Securing a short-term edge over competitors
- Simplifying the integration of technology
- Streamlining the entire business
- Ensuring flexibility for future technology updates, as technology will continue to evolve at an ever-increasing pace.
Missing out on these benefits is, in and of itself, a major risk.
- Missing out on digital transformation means being left behind. It is a costly mistake. From the perspective of the business, even a fatal one.
- Maintaining legacy processes will be costlier and costlier. Such systems do not scale and are less efficient. And very soon, they will be incompatible with everything else out there.
- Haphazard digital transformation will likely be unsuccessful. Spending a lot of money on something that yields no value is definitely a risk as well.
Digital transformation strategy
When working out a digital transformation strategy that suits your needs, consider the following:
- Your digital transformation objectives. Make sure you know where you are going with it.
- The way you would ideally want to couple technology and business.
- The technologies that will make up the backbone of your company’s digital transformation.
- Various industry- as well as non-industry tendencies and trends.
- The risks your company’s leadership is willing to assume before, during and after digital transformation.
- The impact digital transformation is likely to have on the customer experience you offer.
Set a roadmap based on the above, and define it in detail. Consider timeline, expectations, roles, responsibilities, and metrics to measure success.
What is the goal of digital transformation?
The goal of digital transformation is to generate value. The objective is accomplished by improving business processes, UX, and cost-effectiveness.
According to 2,000 business executives surveyed by cognizant.com, digital transformation creates value through five main paths:
- Accelerates revenue growth
- Increases speed to market
- Increases productivity on the level of the individual employee
- Improves customer acquisition and retention
- Improves competitiveness
How to get started with digital transformation?
The first step of your digital transformation journey is to recognize the fact that you need to act.
Most business executives assume that their side is far behind the competition in this regard. Do not grow disheartened. It is never too late to do the right thing.
Also, the perception of your company being behind is likely a false one. The press’ overexposure of the frontrunners promotes such skewed views.
Digital transformation roadmap –
What does a typical journey look like?
A typical digital transformation journey comprises three main stages.
- Value definition
- Launch and acceleration
- Scaling up
The value definition stage includes the first steps, such as securing management support, investment, and setting goals. Without senior management support, it is impossible to commence the digital transformation journey. This support has to translate to funds invested in the effort.
During the launch and acceleration stage, digital culture is introduced and nurtured. This is the stage of lighthouse projects and the appointing of teams. It is imperative to get the lighthouse projects right. You will want to enlist the help of a specialist, like Scrive, at this stage. Lighthouse projects provide inspiration for the follow-up stages of the digital transformation journey.
The scaling stage is about new model adoption and capability building. During this stage, personnel skills have to be boosted. Business leaders need to understand the strategic value of IT.
Digital transformation framework
Digital Transformation can mean different things for different businesses. There are a few common elements across all digital transformation ventures though. These pillars define a digital transformation framework:
- The integration of digital technologies
- User experience
- Workforce-related issues
- The improvement of operational agility
- The altering of company culture
Digital transformation roles
According to enterprisersproject.com, digital transformation entails four different roles:
- Connectors. People who can connect the IT department to the rest of the organization.
- Challengers. Those who assess the process critically, making sure it does indeed fulfill its goals.
- Promoters of agility. These people are not only quick to adapt, but they are also good at helping others adapt to change as well.
- Navigators. Those who show the way. Consultants and digital transformation agencies.
How to start digital transformation?
Digital transformation should always start with the setting of a goal. Securing the support of management is equally essential.
Past that, businesses can choose to dive into the transformation process or to ease into it.
Choosing Scrive’s eSign solution is one way to ease into the flow of digital transformation. eSign allows users to manage all their electronic signature needs in one place. Integration is almost effortless.
Digital transformation ROI and KPIs
It is not easy to justify the costs of digital transformation through ROI. According to a prophet.com survey, 69 percent of digital transformation leaders found it difficult.
Still, using the right Key Performance Indicators (KPIs), you can measure the success of your digital transformation.
Some KPIs to consider in this regard are:
- Sales, revenues
- Customer acquisition
- Customer retention
- Customer experience
- Customer loyalty
- Time to market
- Usage of the collaboration tool
- New system implementation time
- The number of ideas
- Budget for innovations
Digital transformation at scale
The main driver of digital transformation, the need for growth, is what makes scaling necessary. There can be no growth without the proper scaling of digital technologies within an organization.
When it comes to scaling, startups and small businesses enjoy a significant advantage. They do not have legacy systems to phase out. From their perspective, scaling is about resources. Digital technologies offer plenty of opportunities in that regard.
Such businesses can expand their human resources through managed services. They can add to their computing needs through the cloud and they can increase productivity through automation.
Large organizations need to focus on efficiency. Digital transformation for such companies is much more transformative, as they likely have legacy systems and technologies to replace.
Digital transformation challenges –
How to avoid common pitfalls?
Digital transformation can be a challenging, intricate, and costly process. It is easy to get wrong. Most of the challenges entailed by digital transformation stem from its improper execution. These pitfalls include:
- Not setting a clear and realistic goal
- Not having the right leadership
- Not focusing on the customer experience
- Relying on ineffective internal communication
- Not having a proper strategy and guidance
Digital transformation agency –
We are here to help
A proper digital transformation consultancy can help with all the above issues and more. Scrive offers outstanding services in this regard. Their customer case section paints an accurate picture of what they bring to the table.
They do not just provide solutions. They also focus on making integration and adoption as painless as possible.