What is digital transformation?
A digital transformation essentially incorporates digital processes into all areas of a business. To be a true transformation, this integration must be fundamental—companies that make the shift often completely change how they operate and create value.
Digital transformation in companies also marks a shift in existing workplace culture. It prompts them to devote more attention to innovation and experimentation while getting comfortable with risk-taking. For many companies, this means completely eliminating years-long practices.
These transformations can take different forms for every company. But for all industries, the importance of digital integration is becoming clearer each year.
Why digital transformation matters
A digitally focused business model has one major benefit: adaptability. The ability to adapt to changes in the market is essential to surviving challenges like supply chain disruptions and changing consumer needs.
The value of adaptability quickly became clear in the wake of the COVID-19 pandemic. Companies that were able to respond quickly and experiment with creative solutions were mainly the ones that prospered even during a period of upheaval. And in most industries, innovative solutions are difficult to implement quickly—unless they’re based on a digital, adaptable system.
What’s driving digital transformation?
So where does the drive behind digital transformation come from? Naturally, advancements in technology are a key factor. But incorporating new technology is only part of the process. An even bigger factor is the elimination of old systems.
Simply adding new features to outdated systems—known as legacy tech—isn’t useful for companies with visions of long-term success. Getting rid of these processes in favor of ones that are more adaptable is what gives modern businesses the freedom to innovate. And when all aspects of the business are incorporated, a company then has the benefit of being fully adaptable on all levels.
Culture’s impact on digital transformation
Not all aspects of the workplace will be affected the same way by a digital transformation. For example, your IT department may require a complete overhaul, while your marketing team may only need slight changes to its approach.
Because the impact on each section will vary, a healthy workplace culture can ease the transformation process. As a leader, staying attentive to the needs of each team can prevent the tension that often comes with change. Beyond this, building a culture of empathy and respect often makes employees more invested in digital implementation.
What does a digital transformation strategy look like?
A digital transformation strategy will look different for every business. With that said, there are several common factors that characterize the process.
In most cases, switching to new operational technology usually isn’t the first step. Because the goal is to create a digitized system at a foundational level, transformations typically require a “setup” period.
During this time, the focus is on building a company culture that values innovation and experimentation while training leadership to encourage and demonstrate these qualities. From there, time can be spent practicing adaptability and quick responses to changes in consumer needs. Once these steps have been achieved, a shift to new technology can be more easily undertaken.
Digital culture trends to watch
Digital transformation can be a long process. As with any other long-term goal, it may be necessary to make adjustments along the way. For many companies, these adjustments may stem from the digital trends that take hold each year.
For example, sustainability is a growing concern for modern business owners, as is resiliency in the face of unstable markets. Remote capabilities are also important to many professionals who seek the flexibility of work-from-home positions. And as AI develops, companies have begun to look for ways to incorporate the technology into their existing systems.
As trends come and go, it may be hard to recognize which ones will last. But staying aware of the latest industry tech developments can help you keep your company ahead of competitors that are doing the same.
The benefits of a digital transformation
Now that you know all about digital transformations, you’re likely wondering what they can do for your own company. The truth is, there are numerous benefits that can come from going digital, from customer satisfaction to employee performance. Here are some things to look forward to upon implementing a digital transformation strategy.
Data optimization
Gathering appropriate data can often help companies increase their value to consumers. But data collection isn’t useful without proper optimization.
A digital transformation can help build a system for gathering and analyzing the right kind of information. Rather than accumulating raw data, a digitized system can be used to create valuable insights into consumer behavior. And in a world where consumers have greater awareness of how their data is used, it can also help you implement privacy policies that will keep them safe.
Resource management
When your company uses a variety of software and applications to perform each operation, information can be hard to access and share. A digital transformation can help consolidate these resources under one coherent system, making them easier to manage. Plus, streamlining your organizational system can reduce the time spent looking for things, boosting productivity.
Enhanced customer experience
An updated digital system can also create a better experience for consumers. These enhancements come in a variety of forms, including enhanced digital portals, automated correspondence and even digitally exclusive products.
Modern consumers typically expect businesses to have versatile, easy-to-use online systems. A digital transformation can help provide this for your client base, demonstrating your abilities as a modern company.
Increased productivity
Digital transformations can create user-friendly systems for consumers and employees alike. The right technology can streamline the flow of work in several ways.
Easy communication within and between teams can increase collaboration and strengthen employee relationships. Company-wide data integration may also make it easier to find and use information, which can increase efficiency. Some tasks can even be completely automated, freeing employees to perform more complex tasks.
Measuring a digital transformation’s success
Digital transformations require an investment of time and resources. And like any investment, measuring their success is essential.
When assessing performance, make sure to evaluate projects as a whole rather than individually, as this provides a more accurate view of the transformation overall. Additionally, keep in mind that a hallmark of digital transformations is experimentation and risky innovations. Setting metrics before a project begins can help you monitor its progress.
How to develop a digital transformation strategy
It’s easy to feel like your company is far behind the competition when it comes to digital systems. But continuous advancements in technology mean it’s never too late to start your own transformation. To get started, begin evaluating your current processes and establishing innovation as one of your core values. With time, your business will develop the tools it needs to compete on a wider scale.
