With rising inflation and interest rates, deficient talent, conflicts overseas, economic uncertainty, and repressed global supplies still impacting corporate performance, a recession might lie ahead. And for businesses to surpass these scarce times, the only solution is to adopt digital transformation. How and why? Let’s explore this in this blog.
In the last few years, the global economies have experienced a significant slowdown, and businesses across all industries have taken time to pause, re-evaluate, and reassess themselves. When the whole world was confined to their homes and consumers moved dramatically toward online channels, businesses needed to transform and partner with top digital transformation companies to help adopt digital transformation, reignite their marketing strategies, and redefine the industry with a digital-first model.
Further, according to a mid-2020 Gartner survey, seven out of ten boards of directors fast-tracked their digital transformation strategies due to the pandemic disruption; and about half foresee revising their business model due to the pandemic.
Thus, we can conclude that businesses that invested in digital transformation consulting services could cite efficiency, resiliency, productivity, ROI, and competitive advantage by adopting digital transformation during the pandemic disruptions.
Also, since digital transformation (DX), spending is projected to reach 1.8 trillion U.S. dollars in 2022; and will be 2.8 trillion U.S. dollars by 2025.
Don’t you think now is the best time to revisit the previous industry downturns, consider investing in digital transformation and start taking steps to refrain from losing business opportunities during the upcoming scarce time?
Let’s discuss how investing in digital transformation can be one of the best business strategies for entrepreneurs to sustain these volatile times.
Why is ‘Now’ the Best Time for Adopting Digital Transformation Services?
Adopting digital capabilities at the right time can churn the adverse effects of economic pressures and help build a long-term competitive advantage. How? Let’s discuss!
Digital Transformation Insights
- According to McKinsey and Company, due to the Covid-19 pandemic, enterprises accelerated their digital transformation by 10x, showing that companies have primarily focused on digital services and products to compete in a changing marketplace and continue operating to thrive.
- The report by Valior shows a clear correlation between the level of digital transformation and a business’s financial performance. For instance, enterprises that already have their digital journey in place have recorded 2x the revenue growth rate compared to those beginning their digital transformation initiatives. Therefore, for business owners envisioning revenue generation and expansion, it’s best to start planning their digital transformation initiatives before the economic downturn begins.
- The NYT’s report represents digital products and online subscription revenue overtaking print. In addition, Amazon is expected to reach $729 billion in 2022 (compared to the bumper year due to covid-19), signifying the influence of digital and its impact on businesses.
Post-reading the detailed digital transformation insights, it’s evident that digital transformation is enormously revolutionizing how businesses are done.
Numerous renowned brands, including Spotify, McDonald’s, Target, and Volkwagon, have invested in digital transformation and have increased revenue. For example, Dominos, one of the most preferred pizza brands, in the year 2018, made a commendable global revenue of $12.3 billion and took the title of “largest pizza company in the world” from another business giant – Pizza Hut.
Thus, we can indeed say that digital transformation empowers enterprises to thrive in the digital age regardless of the industry. Especially with predictions of an economic downturn, it’s not the time to ignore the digital revolution but to hop on the bandwagon and invest in digitally transforming your business.
If you’re still skeptical about digital transformation, here are the top reasons business leaders should invest in digital transformation consulting services, especially during recession rumors.
Key Drivers of Digital Transformation
Digital Transformation, in essence, doesn’t only mean moving from analog to digital tools and technologies but also refers to a culture shift and rethinking of ways the enterprise essentially functions. To successfully transform, business owners must align their priorities, set realistic expectations, and develop a strategy that reciprocates into a productive transition and business growth.
Further, irrespective of the industry, here are the key drivers of digital transformation that business leaders can aim for:
Enhance Customer Experience – Today’s consumer is way more intelligent and tech-savvy than ever. Therefore, for any organization to thrive in the marketplace and get ahead of the competition, the most imperative aspect is enhancing the customer experience, which is undoubtedly a key driver of digital transformation as well.
- The primary driver of digital transformation for nearly half of all companies is enhancing the customer experience and satisfaction – (PwC).
- Adobe suggests that experience-led companies have 1.6 times higher customer satisfaction rates and 1.9 times higher average order value.
How businesses can enhance the customer experience; here are few ways:
- Personalized user experience
- Customer support – self-service platform
- Omnichannel Experience
- User Customer Journey mapping
- Real-time information update
IT Infrastructure Overhaul – Another critical driver of digital transformation is the need to modernize the organization’s IT infrastructure. Organizations often continue working with outdated or traditionally used technologies as they have become a part of their core business operations. But this, at some point and time, becomes a road blocker for the organization’s growth and scalability.
Therefore, upgrading the IT infrastructure can be another critical business need deriving digital transformation. However, a few technological shifts that enterprises can make are:
- Cloud Computing
- Cloud-native application development
- Responsive Web and Mobile applications
- Business Intelligence (BI) for analytical reporting
Operational Efficiency – The core of any organization is the internal team and the business processes. Every team, while working together, often develops specific work processes. These processes are often manual and prone to human error. Automating these manual processes by introducing third-party APIs, applications, or systems can improve productivity and overall business efficiency.
40% of business executives acknowledged operational efficiency as the top benefit of digital transformation, while 36% believed faster time to market as the foremost benefit of digital transformation (PTC, 2019).
A few examples of automating business processes are:
- Introducing Robotic Process Automation (RPA)
- Eradicating manual approval and reviewal processes
- Developing data-driven business platforms
- Upgrading customer onboarding, finance, logistics, inventory, etc.
Employee Skillset Upgradation – As the enterprise evolves, it’s always essential that the enterprise’s employees grow as well. Employees who remain associated with an organization for years sometimes lack the skills and expertise required to work in the modern business environment. Moreover, since employees are the assets of the organization, upgrading the skills of the employees becomes highly imperative to embark on the digital transformation journey.
However, hiring can always be an option to fill the gap, but upgrading your existing skillset to build the digital workflow can empower an enterprise to compete and grow exponentially.
79% of organizations are strategizing digital initiatives to address gaps amid a tightening market for IT labor over three-quarters, according to CIO Dive.
Competitive Advantage – The benefits of successful digital transformation are improved efficiency, better communication, streamlined processes, and so on, meaning that a company that doesn’t invest in modern technologies will be at a significant competitive disadvantage.
41% of executives say their digital transformations are driven by competitive pressure.
Doing business the old way is acceptable, but remember that the technological paradigm is shifting. Digital Transformation is no longer an option; it’s a must for every company to maintain a market share in a digital-first industry,
Turn Data into Business Intelligence: Data can be one of the most crucial elements to unlocking an enterprise’s customer insights. Digitalization help companies combine data from all customer interactions and formerly unstructured sources and transform the raw data into meaningful, actionable insights to optimize customer experiences and help organizations make more informed data-driven decisions.
Better Profitability with New Revenue Streams: To most, digital transformation might seem challenging, but the rewards that enterprises yield post-transformation are often exceptional and empowering. The Digital Economy research’s MIT initiative recorded that digitally mature firms made 26% more profit than their peers and generated 9% more revenue from physical assets. Thus we can conclude that digital transformation indeed results in an enterprise’s financial growth.
Accurate Market Segmentation: New technology enables businesses to discover more adaptive and agile models based on customer parameters that were impossible to uncover and track without being digitally advanced.
Improved Silos: Identifying silos that span multiple functions and processes become much more manageable, allowing an organization to increase its efficiency and impact as introducing digital transformation initiatives streamlines business processes and improves operations and work efficiency.
Increased Agility and Innovation: Innovation is the only way forward. Creating an agile and connected ecosystem that is digitally able to respond and manage disruption in real-time is the key to thriving competition. Digitally transforming the business can lead enterprises to become more responsive and agile to the dynamic market demands by eliminating their dependency on traditional legacy IT systems.
Top Technologies Powering Digital Transformation
Technology has been one of the most empowering elements for enterprises’ digital transformation. Irrespective of whether the aim of digital transformation is enhancing employee performance, exceeding customer expectations, achieving innovation, or analyzing the data, businesses often prioritize leveraging these advanced technologies:
- Mobile Technology
It’s no news that mobile technology is a crucial aspect of digital transformation. Numerous studies indicate that most business leaders are well versed in the importance of mobile technology in digital transformation. As per one of the latest PWC surveys, it was found that 71% of CEOs believe that mobile solutions are more critical than IoT and cloud computing, and 29% consider it the second most crucial technology empowering digital transformation.
Being one of the critical technologies, mobile solutions lead to more streamlined communication between the enterprise, its customers, and employees. In addition, mobile solutions are often an excellent source for collecting valuable real-time data that can further be leveraged to grow the existing customer base in the highly competitive market.
- Internet of Things (IoT) and 5G
The Internet of Things (IoT) basically refers to an extensive network connecting data, people, and systems to enable process automation and the collecting and sharing of information without manual input. For example, IoT and 5G are the two booming modern technologies offering excellent efficiency across several industries. It’s observed that IoT has been benefiting the manufacturing industry by streamlining and updating their operations, along with helping the healthcare and retail industries offer an unparalleled customer experience.
In addition, associating with business transformation consultants to deploy 5G in IoT applications can empower enterprises with high speed, bandwidth, low latency, fast transmission capabilities, and seamless connectivity.
- AI & ML
Artificial intelligence and machine learning are two of the most impeccable technologies becoming the core of enterprises planning to transform and grow their business digitally. Primarily Artificial Intelligence (AI) efficiently enables organizations to mimic human intelligence, automate tasks, make faster decisions, and engage customers.
And on the other hand, with the extended availability of data, Machine Learning (ML) uses algorithms to evaluate and contextualize the patterns, so that information or actions are automatically triggered without human assistance.
- Virtual & Augmented Reality
VR & AR is primarily mobile technology coupled with real-time data to generate a virtual glimpse of the systems that help organizations and customers in different capacities. These technologies aid businesses with the development of tools, cybersecurity, business forecasting, marketing, and customer support by paving the way for intuitive methods of dealing with technology yielding unparalleled customer experience, engagement, and business growth.
- Cloud Technology
Cloud technologies have become increasingly popular due to numerous benefits like flexibility, cost saving, scalability, ease of use, improved data security, and agility. Some famous examples of cloud software are Google Drive, Slack, Salesforce, and Office 365.
Being well versed with cloud technology advancements, businesses have begun adopting cloud transformation services that help them move away from traditional software due to the inability to process mass data securely and cost-effectively.
A Guide to Building a Digital Transformation Strategy Roadmap
Without a roadmap, any business’s digital transformation initiative can be prone to failure. Therefore, here are a few steps to set you and your business up for success.
- Business Evaluation
Before getting on to any changes or revamps in the business processes, it is imperative to reflect on the existing working methodologies and approaches. For instance, evaluating your current state with the relevant business data and insights will help you set a stable foundation to understand the loopholes and gaped opportunities and better strategize your digital transformation efforts.
However, partnering with business transformation consultants can be one of the most effective choices when evaluating your business data and insights.
- Competitor Footprint Analysis
Before embarking on the digital transformation journey, looking into the competitive landscape is always essential. Analyzing what your competitors are doing, whether they are in the transition phase or already digitally equipped, what kind of products and services they are offering, what is the customer response to their offering, etc., will help you better transform your business and have a competitive advantage.
- Set Goals & Priorities
Once you know what your competitors are up to and what gaps and challenges you are experiencing, it becomes easier to map the digital initiatives you would require for your business growth and success. Whether you’ll need a tech stack to revamp, the addition of new technologies, or the development of your digital asset. However, the ultimate success will depend on how well you were able to assess your business and competitors.
Following a SMART goal-setting approach when establishing your objectives can benefit you in numerous ways:
Specific – What do you want to achieve?
Measurable – What metrics will indicate your success
Achievable – Are you capable of achieving the goals you set
Relevant – Does your transformation goals align with your business plans
Timely – What is the timeline for completion of your goal
- Lay Down a Realistic Delivery Plan
Upon analyzing your business and competition, you might notice numerous aspects of your business that you would want to improve. But practically, it’s impossible to transform everything together in one go. Therefore, breaking down your analysis into manageable deliverables and creating a collaborative work environment is imperative, giving your team smaller goals to tackle and providing a clear opportunity to regroup and reassess your plan, thus will empower you to transform more efficiently.
- Start Building Digital Capabilities
Any change a business leader plans for their organization, the most significant impact it has is on the organization’s employees. Therefore, before beginning the transformation journey, it’s essential to modernize the core operating infrastructure and processes and involve the employees in the journey.
Communicate the need for this digital transformation to your employees, equip your team with opportunities to express opinions and concerns, and share ideas on improving the implementation. This will help you assess the need for training and skill development or hiring new talent and thus will ultimately help you with a seamless digital transformation journey.
With all that we read, it’s easy to conclude that digital transformation is more about your business than technology. It’s not a project or task but a strategy, a journey an entrepreneur must go through to achieve the business vision.
The rapid technological changes, a whopping economy, and an enormously competitive market are making it imperative for today’s enterprises to start including digital transformation as a continual process of monitoring and adapting your business operations to fit your needs best.
However, a digital transformation roadmap that is not well thought out and strategized can often be complex and fail when not supported by business transformation consultants.
Therefore, if you wish to transform your business digitally, you can get in touch with Copper Mobile – one of the top digital transformation consulting firms, to identify the gaps and challenges, analyze the business data and strategize an efficient digital transformation journey empowered with the right tools and technologies.