Fully leveraging the opportunities brought about by digital technologies is on most businesses ‘To do’ list. Undergoing change though digital transformation enables companies to improve operations and provide better value to customers but preparation is key to success.
The latest IDC study predicts digital transformation spending to reach $1,7 trillion worldwide by the end of 2019 presenting a 42% increase in spending since 2017. Propelled by the benefits including higher gross margins, revenues and profits according to Harvard Business School, many companies are seeking early adoption.
In order to reap the rewards and stay competitive a holistic and scalable process to cover all bases of the business is required. The implementation of both short and long-term strategies cannot be ignored either.
Five steps to successful preparation
1. Focus on customer outcomes
Digital transformation can help companies deliver the right customer outcomes. Customer expectations have shifted, and the vast majority demand a personalised experience.
2. Re-define business culture
Most organisations haven’t aligned their business culture with their efforts to embrace modern technology. To do so however will help create more engaging and collaborative teams and relationships. An agile business culture that’s constantly developing is vital.
3. Align strategy with business goals
Digital transformation can very quickly become an endless catch-up game for businesses seeking to adopt new technology for the sake of it. Working out viable digital business models requires the alignment of strategy with business needs so as to invest in technology that has the most impact. The objective should focus on integrating technology that makes achieving business goals easier.
4. Invest in the right technologies
Like with most things, throwing more money at a problem won’t necessarily fix it nor will it count toward implementing an actual strategy.
Three main technologies are currently driving digital transformation and providing the biggest impact on business operations including the Internet of Things (IoT), the cloud and big data.
5. Train your staff
To become a digital leader, an organisation must possess the right knowledge. Staff training programs ought to be comprehensive and inclusive leading to increased productivity, efficiency and security. Upskilling staff and expanding their capabilities will also boost overall employee satisfaction rates.
Creating an effective digital transformation strategy
According to IDG’s 2018 Digital Business Survey, 89% of organisations plan to adopt a ‘digital-first business strategy’. Furthermore, the survey found start-ups to have superseded their traditional business counterparts in understanding the value of digital transformation. A total of 55% of start-ups were found to have already implemented a digital business strategy in contrast to only 38% of traditional enterprises.
When preparing for digital transformation, understanding the components that make it effective is paramount. A worthy strategy will:
- Be backed and fully supported by management
- Prioritise strategy over technology
- Encourage disruption and risk-taking
- Reimagine the customer journey, focusing on the customer’s viewpoint
- Integrate all aspects of the business
- Follow and understand new technology trends even if the newest technology isn’t always worth investing in
Being a data-driven organisation and understanding the value of data analytics can help drive an effective digital transformation strategy. Data management should begin with the auditing of current data and ensure newly generated data is used to create a comprehensive data bank.