Digital Transformation: Staying competitive with innovation

Upgrade the level of your business and keep up with your competitors by embracing digital transformation.

For businesses worldwide, one of the popular topics of discussion in recent times is Digital Transformation. Companies need to embrace innovations that bring in great benefits so that they remain competitive in the industry. Utilizing new digital processes and tools will allow organizations to reimagine the way they run their businesses.

The Importance of Digital Transformation in Businesses

• Digitization, Digitalization & Digital Technology

Digital transformation holds immense importance and serves businesses to the utmost. It helps organizations achieve their goals and offer them scores of benefits, including reduced costs, shortened time-to-market, data-driven customer insights, and so forth!

But before proceeding further, get familiar with the term ‘digital transformation’. And even before this, you must first get to know the concept of digitization and digitalization.

Essentially, digitization is converting analog information of physical documents into digital information. And digitalization is using that digital information to make working more effortless and meteoric. Digitalization significantly influences customer service and benefits both the business and its customers. You can access customer records painlessly and retrieve them via computer at a rate of knots. Thus, technology is not only upgrading people’s lives but also making work plain sailing!

With the evolution of digital technology, many came up with inventive ideas for using business technology. This instilled the concept of digital transformation. Then businesses started thinking and implementing new ways or technologies to modify their method of working.

• What Does Digital Transformation Mean

To keep up with the changing business and market requirements and to drive fundamental change, businesses need to reimagine their daily operations and how they communicate and engage with customers.

Companies adopt digital technologies to create new ones – or improve the existing – business operations, culture, and customer experience. This reimagining of business to meet the evolving market and customer expectations is called digital transformation. Thanks to digital transformation, novel, futuristic products, and services are emerging!

 The Importance Digital Transformation Holds

Digital transformation reshapes how a company approaches customer service. When executed correctly, it can make a business more efficacious and profitable. It is vital to survive in the face of the future. For any business that wants to remain competitive in today’s marketplace, digital transformation is essential.

Digital transformation affects many aspects of an organization’s functioning, including how employees work, business processes work, and how data is collected, analyzed, and used. An effective digital transformation is one that enhances customer experience and improves the way a business operates behind the scenes.

The Bountiful Benefits of Digital Transformation

With digital transformation, the industry can combine practices and ways of doing, resulting in new skills, techniques, and income streams. Following are some of its main advantages.

1. Informed Data-Driven Decisions
   By going digital, you can view metrics and examine the data you recorded during your digital marketing efforts. This will help you understand customers better and rethink your business strategies so you can make informed decisions.

2. Minimize Costs Substantially
   Due to time savings in the processes, digital transformation also minimizes costs. According to Gartner, two-thirds of digital transformation initiatives begin with cost-related goals.

3. Refine Product & Service Quality
   Digital transformation generates a competitive advantage for the company. It helps businesses enhance the quality of the services and products they manufacture.

4. Abbreviate Time-To-Market
   Along with improved quality, customers expect a fast supply of products and services. This expectation is met by digital transformation. It increases the speed of response to alterations in demand in the market.

5. Improve Customer Experience
   Customer experience plays a crucial role in a company’s success. Therefore, businesses adopt digital transformation to offer customers better service, improved quality, and innovative products for a superior customer experience.

6. Enhance Company Culture
   People like to work in a company that embraces digital transformation. Since it offers employees flexibility and improvement in their daily tasks. As a result, they feel inspired and motivated when their company looks for better ways of doing business.

7. Make Outstanding Collaborations
   As leaders build the organization on digital congruence, DT offers an excellent opportunity for unity. You’ll witness a swift and seamless transition if everyone is aligned to the same purpose.

8. Drive an Innovation Culture
   To enable the creation of novel products and services and open the door to many business opportunities, organizations need digital transformation. By driving a culture of innovation, it prepares the companies to anticipate any disruption.

9. Boost Efficiency & Productivity
   When you have the right technology tools that work together, you can streamline workflow and improve productivity. In addition to automating many manual tasks, it integrates data throughout the organization, enabling team members to work more effectively.

2.    Challenges in the Way of Digital Transformation

The benefits of undergoing digital transformation are incredible. But to avail them, organizations come across some challenges they must overcome. These challenges are listed below:

1. Lack of a Unified Vision
   Organizational silos have a terrible impact on digital transformation. From strategy development to implementation, they cause obstacles in almost every aspect of change. When teams or departments in an organization operate in silos, they make decisions based on their own goals and problems. This leads to disconnected decision-making. Additionally, each team lacks a unified vision that drives them to the same destination, hampering transformation within the organization.

2. The Old-School Mentality
   One of the top bottlenecks in digital transformation is not leaving your comfort zone and using the old-school mentality. Enterprises, in spite of the availability of more agile and robust systems, still use legacy systems. It’s because they’ve invested a lot in it and are still reaping benefits from them. However, these legacy systems are not only slow and inflexible but also vulnerable to security breaches.

3. Not Enough Budget
   Implementing new digital technologies is a big-budget process, requiring whopping investments. Therefore, due to low-budget, some businesses suffered substantial losses during the pandemic. It prevented them from implementing new digital solutions. In organizations that don’t have a stellar transformation strategy, scope creep can increase project costs and delay deadlines. Any consulting work you do, changes in your customers’ needs, or IT errors will drive up the cost of technological change.

4. Absence Of IT Skills
   The success of your transformation efforts depends on the skills and performance of your IT team. And in the current scarcity of tech specialists, it’s difficult for organizations to achieve their digital transformation goals. Unfortunately, the process of finding skilled people can be intimidating and often expensive. Businesses may face challenges, including cloud, software integrations, data migration, data analytics, cybersecurity, and application architecture.

5. Less Technological Resources
   Apart from the dedicated IT skills shortage, companies also face the non-availability of resources essential for digital transformation. There’s still a scarcity of microchips. Besides, some issues are holding back the supply chain for IT hardware. This scarcity impedes the prompt deployment of requisite resources to the right initiatives.

6. Privacy & Security Concerns
   Many businesses rush to the implement digital solutions to meet sudden consumer needs. This makes them vulnerable to high cybersecurity risks. As a result, other companies become worried about experiencing similar breaches with their own security measures. Even enterprises with solid tech development teams struggle to verify the security level of third-party tools and platforms.

7. Thorny New Technologies
   Some new software and technologies are highly complicated and can be daunting. So, organizations encounter plenty of problems while embracing them and undergoing digital transformation. This becomes a big challenge for them – both from the perspective of data integration and implementation, as well as in terms of end-user experience.

8. Evolving Customer Needs
   Digital transformation is not everyone’s piece of cake. It requires years of intensive efforts to achieve such transformation goals. And imagine, during that time, there’s a sudden change in your customer needs! Obviously, the evolution of customer problems will occur. Plus, COVID-19 has already accelerated the changing customer needs.

3. Overcoming These Challenges for Digital Transformation

Businesses that face the above challenges can overcome them by working on the following: 

1.     Aligning Goals with Strategy
   You must first align your business goals with initiatives to transform your business digitally. According to the importance of specific objectives, prioritize digital investments. With the help of outcome-driven criteria, decide where to invest and which programs to pay your attention to.

2.     Building A Digital Culture
   Implementing digital transformation requires a change in organizational culture. It may be difficult, but necessary. Begin by accessing cultural obstacles. After that, develop a comprehensive and unified change management strategy. But remember that change should start from the top to minimize resistance from employees.

3.     Proper Employee Training
   When it comes to new processes and technologies, tenured employees often resist change because they believe their current methods are fine. So, in order for employees to learn and understand the value of new software processes and upskill them, organizations must provide comprehensive onboarding training and ongoing support.

4.     IT Personnel Remote Outsourcing
   If an organization lacks IT professionals, it can outsource this work to outside consultants and dedicated remote teams to assist in implementation and migration. Besides, it can create an in-house team or have a leader with proper skill sets that can manage your IT strategic planning.

5.     Investing Budget Rightly
   For businesses to grow, it is necessary to implement new Software Development services. Nonetheless, improper planning and management can lead to budget overruns. You can avoid this by developing a comprehensive digital transformation financial strategy. Compute the anticipated costs, possible long-term gains, and also investment returns prior to implementing the transformation.

6.     Defending Against Threats
   To accomplish digital transformation goals, you need to continuously enhance your cybersecurity capabilities. Always have a plan ready to boldly migrate the privacy and security threats before they happen. Besides, provide cybersecurity training to your employees and with the help of a cybersecurity pundit identify weakness in your defense.Organizations need to take drastic steps and be ready to try new things and fail at times. At first, it may seem insane to abandon familiar business processes, but in today’s world where digital technologies are crucial and must be embraced, it is madness caused by times.

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4.    Case Studies of Successful Digital Transformation

Despite the mentioned challenges, organizations can innovate and grow. And, the best way an organization can develop an effective marketing strategy is to learn. So, here’s a list of top inspiring case studies organizations can learn a lot from.

• Examples of Some Digital Transformations

Following are a few inspiring case studies of companies who successfully implemented digital transformation and entered an exciting level of growth:

1.  The Swedish company, IKEA is using advanced technologies to upgrade the shopping experience for its customers and optimizing its costs. The furniture industry tycoon acquired TaskRabbit that lets you search and hire a tasker who’ll help you complete daily tasks like furniture assembling, frame mounting, and much more. The company is also using Augmented Reality (AR) in the IKEA Place app so you can virtually place furnishings in your space.
2.  The Danish toy company, LEGO digitally transformed itself by offering games that are largely free. It is exploring 3D printing options; besides it has created a website that collects customer ideas for block sets. This will boost the creativity of the customers. The company is currently working on combining the virtual world of games and physical blocks.

    iii.  The sports footwear giant, NIKE uses modern technologies that rely on recommendation algorithms and Machine Learning (ML). The brand came up with a mobile app, NIKE Fit, that helps you choose the best shoe type by scanning your feet. It digitized 6000 footwear materials which saved time and led the company’s design team to work more efficiently.

1.  Another example includes DISNEY that greatly enhanced visitor experience by implementing The MagicBand that lets parkgoers make payments, access their hotel rooms, and manage reservation. In addition, Disney+ streaming platform blesses its users with access to the latest Marvel, Pixar, and the Star Wars saga productions.
2.   Plus, AUDI introduced Audi City where users can see the entire catalog of its models in micro-showrooms in city centers. Besides, it made advanced car configuration possible in stores; you can use your tablets and view the car from inside, watch how it moves, and hear how it sounds.

Inspiring, isn’t it!

•   Lessons Learned from Their Journeys

The aforementioned examples of digital transformation show that a successful transition is not only feasible, but also profitable. Therefore, it calls for a keen understanding of market needs, being creative, and a methodical approach to putting innovative solutions into practice. Nevertheless, if we can meet these conditions, we may expect more customer satisfaction, better brand recognition, and ultimately escalated sales. That means, more companies should go for digital transformation.

Closing Thoughts

Digital transformation is not just a trendy subject right now. For companies that want to stay competitive and take consumer feedback seriously, This is the Reality!