How Digital Transformation Can Change Your Business In 2020
Digital Transformation is a buzzword that has become increasingly popular in recent times. Amidst all the global white noise about companies investing significant time, efforts, and capital into digital transformation, let’s just take a step back and answer the most basic question, “What does digitally transforming your business really mean?”
Is it simply about keeping up with the latest gadgets and software? Or is there a deeper meaning that connects the transformation to how consumers want to interact with your brand? In this blog post, we explore what digitally transforming your business in 2020 is like, what to expect, and how, if done right, it can contribute to the growth of your business.
What is digital transformation?
Just like how biological evolution makes sure that a species survives the many changing conditions in the world, digital growth ensures that irrespective of the many technological changes happening across the globe, a business can still thrive and grow.
Simply put, digital transformation is the process of using up and coming digital technologies to either modify or create new business processes. While many businesses view the concept of digital transformation as a disruption, there’s no doubt that they add incredible value to the organization and bring multi-faceted benefits to any business.
Digital transformation transcends traditional roles like sales, marketing, or even customer service. It goes beyond businesses trying to meet the changing needs of the market and stay ahead of the competition. Digital transformation begins and ends with only one factor — customer engagement.
How does digitisation impact customer engagement?
There’s no doubt that digital transformation is changing how businesses work. As organisations move from traditional paper and spreadsheets to smart applications to manage their operations, they have a chance to reinterpret how they do their business — how they engage with their customers, with digital technology on their side.
More and more companies are now taking a step back and revisiting everything they do — from internal systems that they use on a day-to-day basis to how they interact with their customers. Questions like, “How can I change my processes to add value to every customer interaction?” and “Can my processes enable a better and personalised customer experience” is on the mind of many CEOs in the world today.
For instance, let’s consider Netflix:
A classic example of digital transformation and customer engagement is Netflix. Netflix started as a simple mail-order service but ended up disrupting the entire brick-and-mortar video rental business. By taking advantage of digital innovation, Netflix made wide-scale video streaming possible. Today, Netflix has almost replaced the traditional broadcast and cable television networks by simply offering a growing library of on-demand content at extremely competitive prices.
Digitisation not only allowed Netflix to stream video content directly to their customers on their laptop screens and mobile phones but also gain an unparalleled insight into the viewing habits and preferences of each user. The amount of massive data collected helped Netflix design a better user experience, and understand the shows and movies that the majority of their audience is interested in. Thus, by using digital transformation, Netflix made a net income of over 1.86 billion U.S. dollars in 2019! (Yes, you read that right!)
In fact, one of our clients, Hesus reached out to us because their existing systems were old, laborious, and obsolete. They wanted to digitally transform their business so they could streamline their processes and increase their overall efficiency.
How can digital transformation benefit your business?
1. Streamlines existing processes
If you’ve been running a successful business for a couple of years now, then you know that executing any operational process is extremely time-consuming. In a world where time is a luxury, you just cannot afford to spend precious time on redundant processes — operational or otherwise. By using digitisation and cutting edge, new-age technology, business operations such as communication, data storage, and analytics can become more adaptable and collaborative, in turn, maximizing results.
2. Increases overall efficiency
Because all your processes are now streamlined, thanks to digitization, you no longer have to worry about unexpected bottlenecks. Digital processes allow the quick flow of inter-departmental information, eliminates redundant tasks and improves the overall efficiency of the business.
This, in turn, also helps reduce the operational costs that are associated with complex, time-consuming workflows. The digital transformation of business prevents the bottleneck of data and information. Also, streamlined processes and increased efficiency means that the workflows can be adjusted quickly and easily, based on the changing priorities and goals of your business.
3. Promotes an environment for growth
With digital transformation comes a strong customer base, increased customer engagement, efficient processes, and automated workflows. And that’s why it’s no surprise that companies that implement digitization find it easier to grow and expand.
For instance, an organisation that has no online presence whatsoever probably generates sales through retail stores and word of mouth. However, by building an optimised and robust website, the business will be able to attract more customers than before. This means that they now have more opportunities to promote their products, generate more sales, and in turn, reap profits. Further, by tracking the behavioural patterns and feedback of their existing customers, they can create more products that appeal to their clientele and scale their business accordingly.
4. Empowers the workforce
Technological advancements and innovations also empower the workforce to become more proficient and productive in their day-to-day tasks. Working with streamlined processes means that they can accomplish all their tasks quicker. Further, by learning and implementing digital transformation, engineers are exposed to the latest technologies such as Artificial Intelligence and Machine Learning. Thus, digitisation allows them to capitalise on their efficiency by using AI-powered tools and getting the job done in lesser time. They also get to learn advanced skills, which can go a long way in boosting their personal growth as well.
How can you build a digital transformation strategy?
1. Assess your industry
The first step to digitalise your business is to simply look at what your peers are doing. Start by assessing what strategic moves your competitors are making. What is their digital strategy like? Has digitisation positively impacted their business? What are the customers’ expectations? Will the industry be affected by sustained digitization? These are incredibly crucial questions that need to be answered before you can dip your toes in the world of digital transformation.
2. Define your path
Once you’ve done your research, based on the insights, it’s time to design your strategic path. This primarily means the kind of operational model you wish to implement to deliver the right products and services to your consumers. Based on the operational model that you choose, assess all your internal operations, and chalk out a plan of action. Which operations must be prioritised first? What analytics need to be taken into consideration? All of this is the groundwork for the next step.
Once you have established a path and agenda, break it down to concrete and tactical moves. Consider all the resources and the timeline required, and plan your strategy. This step involves meeting with technology enablers who have the required domain expertise, studying the different digital environments that can work for your business, and filling all the missing technological gaps.
4. Making the transition
The transition from the old and redundant IT processes to a new cloud-based digitised ecosystem is a process that takes time. You must gradually move to the future infrastructure and platform while maintaining the existing ones to ensure that there is no data loss or system failures.
Trends in digital transformation in 2020
Digital transformation accelerated across many industries in 2019. 2020 will also see the rapid scaling of digital initiatives across different industries globally. Here are some digital trends that you should be on the lookout for this year:
- AI and Machine Learning will take centre stage.
- Newer digital transformation success metrics will be created.
- Businesses will pay more attention to the long-term value of digital initiatives.
- Adoption of different digital operating models, such as integrated cross-functional teams.
- An expansion of public cloud adoption.