Most businesses would talk about wanting to undergo the digital transformation, but few would actually do so. But after COVID-19 disrupted business operations globally, most big and small businesses now see digital transformation as the only way forward. Driven by fast internet, digitization now plays a vital role in adding more business value. The proof of this is the way big players are making huge investments in building their AI and business intelligence platforms. As a result, the digital transformation global market is set to grow from USD 469.8 billion in 2020 to USD1,009.8 billion by 2025, at a CAGR of 16.5%, clearly showing that its the number one priority for enterprises to stay relevant in the changing business trends.
According to Amazon Founder Jeff Bezos, “In the current times of volatility, reinventing is the only way forward. The only sustainable competitive edge you can have over your rivals is agility, period. Since nothing else is sustainable, everything else you create, someone else will benchmark”.
Digital Transformation modifies the approaches to how enterprises create, monetize & defend value that will offer them a competitive edge. Companies that are left behind and do not enter the digital transformation zone run the risk of being bought or liquidated by digitally transformed ones. To be competitive and not miss out on any growth opportunities, enterprises must embark on their digital transformation journey right now. Here are five steps to begin with.
Step1: Define Digital Transformation meaning suitable for you
Although digital transformation is vital for a company’s success, the first and most critical step is to assess what it really means for your business. The term “digital” can have varied perspectives on different enterprises. This is because the digital transformation will include problem-solving, and every organization will have problems in various areas like employee management, maturity, the value chain, competition, industry, and ecosystems. Therefore, it’s imperative to conduct brainstorming, pick challenges faced by the company, and see if digital solutions can help resolve them, leading to higher profit and overall growth. Hence, identifying challenges through a detailed audit must be the first step you take at the beginning of your digital transformation journey.
Step 2: Set the ball rolling on how your organization will go digital.
After you have established the key challenges, you can evaluate the digital transformation alternatives. These alternatives include front-end transformations like customer experience and end products and back-end transformations like IT infrastructure and the cloud. Here are certain proven strategies adopted by companies seeking digital transformation in both the front-end and back-end:
- Aligning products and customer experiences using a digital element: Digital transformation will utilize technology to build new or align existing cultures, business processes and customer experiences to meet changing trends and requirements. Digital component induces the necessary force needed to offer the best products and customer experiences.
- Building digital ecosystems: Enterprises no longer run in silos and depend upon big ecosystems to achieve digital transformation. Cloud expertise, internet connectivity & big data are at your disposal to build a digital ecosystem that is much easier to operate and achieve better results.
- Monetizing the data extracted from the IoT ecosystem: Businesses utilize data collected from their Internet of Things solutions in multiple ways, like building new features and solutions to capture the market faster and make profits.
- Transforming daily operations and factories: Most organizations look to transform their factories or other infrastructure to get more leverage out of the latest innovations like 3D printing, advanced automation, AI and more.
- Building a robust IT infrastructure: As per numerous digital transformation surveys, one of the biggest challenges enterprises face is the mismatch of their existing toolsets. Whether in-house built or outsourced, the IT infrastructure is the heart of your organization and needs to be in sync with the latest technology standards.
Step 3: Ensure executive buy-in is made a top priority.
Once you zero in on your digital strategy and solutions, spreading awareness inside the company and getting executive buy-in are imperative. It’s essential to get the digital transformation process up and running and ensure the required investment is ready to make this transformation effective. Even though it seems straightforward at first, it will take a certain amount of time before you get the executive buy-in, so it’s ideal to take this step as soon as possible once the digital transformation strategy is finalized. The importance of executive buy-in can’t be stressed enough. It is one of the most reliable indicators of an enterprise’s strategic commitment toward digital transformation.
Step 4: Search for Partners to support your digital transformation journey
Enterprises’ biggest hurdle during their digital transformation journey is the lack of internal expertise to drive the initiative. This is the time when partners become a vital part of your digital transformation. When digital transformation stakeholders asked about partners’ roles, most agreed that their partners have a huge role in ensuring success. The majority of digital transformation surveys reveal that companies expect their partners to assist them in the digital transformation journey by:
- Provide consulting services that will assist in integrating digital technology into day-to-day operations
- Delivering capabilities to drive the transformation in real-time
- Helping them move in the right direction in the digital innovation landscape
- Sharing best practices and successful strategies
Step 5: Ensure your workforce is digital transformation ready
Clear communication of your digital transformation vision and value to your employees is as crucial as devising a strategy. If this is not done right and communicated well, the enterprise may not receive intrinsic buy-in from its workforce. Ensure employees are provided transparency, proper structure, plan, and high-quality training to get them digital transformation ready.
Once the above five steps of your digital transformation journey are successfully accomplished, it’s time to double down on your efforts, as they continuously need improvement. Both the management team and workforce must work in sync to ensure the digital transformation is successfully deployed in every activity related to the business operations.
Always remember that technology will get updated daily, and you must look for new growth opportunities for the sake of your enterprise. As the market is subjected to change, customer expectations also vary accordingly. If your digital integration strategy can function effectively in this dynamic world, you can reap the full benefits of digital transformation without any hassles. Start your digital transformation today using the wisdom gained from the above discussion. If you are still playing the waiting game, then there is a big chance that your enterprise can never reach its growth potential and become a big brand eventually.