Digital technologies are reshaping the face of today’s business that speeds up the process of transformation in organizations. According to IDC report, worldwide spending on the technologies and services that enable the digital transformation of organizations will reach 1.97 trillion U.S. dollars in 2022. Interestingly, this dynamic is expected among all industries, B2B and B2C alike. Sounds impressive, right? Let’s find out what digital transformation means and check out some essential tips you should consider if you decide to go “digital.”
The anatomy of digital transformation
Digital transformation is the process of using innovation for business development and growth by automating operations, management, and communication, as well as introducing cutting-edge solutions to the market. Generally, digital transformation is about change and integration of technologies into business activities — it can either fit into an existing business model or inspire companies to pivot into new directions.
The digital transformation is not only based on changing technology, but also on the company. You need to integrate innovation at all stages of business development — from the business model ideation to the interactions with the end client.
Digital transformation relies on four pillars: people, process, content, and technology. If all these factors are combined successfully, the company can be digitized properly.
Transformation starts by assembling a team of people who’s capable to conduct the process. You don’t have to hire a brand new team. Rather, you can opt for the help of consultants or outsource your digital transformation tasks to experts.
Digital transformation requires business owners to hire people with the following expertise:
Software development- Digital transformation heavily relies on creating new tech products and making the most of your existing ones. You might have to develop a new website or refactor your existing one. To find out what you need to create, and what elements can be reused, you can contact an expert software development team. Then, you should consider either hiring in-house specialists or opting for offshore services.
Marketing and communication- As your company becomes more technological, you will have to explore new communication channels, emphasizes on social media, email marketing, content marketing, and search engine optimization. To get results quickly you need an experienced marketing specialist/team with a vision.
Design- Successfully transformed companies place design at the center of their work processes. UX designers carry out market research, determine user personas, and research product requirements. UI designers implement this vision practically by creating actual interfaces.
Once you have a team on your side, you need to start building the processes of transformation. Don’t strive to implement all aspects of digital transformation altogether, instead, go from the improvements that will bring the most tangible results.
It’s best to start with management and communication within the team — before you start attracting new customers, you should assure that you are ready to handle increased workloads. The next step is to automate customer interactions and offer new communication channels – this means, offering online support from your website, answering questions on social media, and using chatbots to answer frequent questions.
Once you’ve optimized existing business processes, it’s time to explore new opportunities. Let’s take a closer look below:
- Analyze the activities of competitors and see what digital products they have successfully introduced to the market.
- Talk to your customers to see current problems in your market. If you know how to solve this issue, you might have a new business model.
- Analyze your skill sets – Before you start implementing innovation, analyze your human resources. Ask your employees to evaluate their skills in their areas of expertise and see what you can achieve with resources in-hand.
- Evaluate the cost – Once you know what technology you’d like to implement and which resources you have available, you can calculate the approximate cost of the innovation. To be more precise, conduct the risk assessment — predict what could go wrong and how much time it would take to solve their problem. Then, multiply the hourly cost of your specialists by that amount of time — and that’s how you know the cost of the project and possible complications.
- Start development – Don’t delay the preparative stages. When you are waiting, your competitors already adapt new solutions and bring innovations to the market. Digital transformation is a marathon, but it’s also a race, and you can’t just do nothing.
Implementing new technology is a time-consuming stage, so you can combine it with organization and promotion. There is no need to pause other processes while you are working on the innovation.
Digital companies embrace content marketing — the process of creating useful content that educates the final customer and improves the company’s reputation on the market. This includes having an active blog with useful guides, white papers, collections, active newsletters, social media accounts and outreach activities — advertising, guest posting, and PR.
You need to brand your business as an innovative company. Clients should be used to seeing you as a driver of innovation. Only by creating and publicizing an expert content, analyzing your visitors’ feedback can you achieve highly visible results.
Proven tips to unlock success in digital transformation
Embrace different perspectives: The business owner should prepare the team to face the challenges in the digital transformation journey. If the business didn’t closely work with technology before, education should be a priority at this point.
Create a shared vision: Business owners should explain what business transformation can bring to the team — reducing the time and efforts on performing boring manual work, optimizing interactions with clients, driving more profits, exploring new niches, etc.
Identify a scalable solution: When the business owner has the idea of the purpose of the transformation and communicates these goals to the team, it’s time to define the solution. Define technological goals that will describe the type of innovation that will help you to achieve your objectives as well as financial priorities — how much profit can transformation drive to your company.
Focus on incremental wins: Use automated task management systems like Trello, Jira, Odoo, and track your team’s progress. To measure client engagement, connect Google Analytics to your website and use UTM-tags to track the efficiency of additional communication challenges.
After you know what goals you want to achieve, have an idea of how to do it and measure your results, it’s time to start the transformation itself.
Benefits of Digital Transformation
Let’s see how implementing digital transformation can increase business growth rate and drive profits to the company short-term and long-term.
1. More transparency
Using big data and machine learning analytics, companies can know their customers better and implement these insights into their marketing and communication activities. Salesforce already offers add-ons that can provide detailed insights into sales pipeline based on analyzing website visits — this helps the team to know more about their clients.
Statistics show clearly that these personalization efforts don’t go unnoticed. According to Accenture, 83% of customers say that they would gladly provide their data to enable the business to do the following:
- Recognizing users’ names;
- Offering products that are relevant to the customer;
- Special offers should be based on personal purchase history.
Digital transformation makes it possible for companies to get in touch with their clients and understand their needs. It’s a solid ground for the introduction of new products and services.
2. Result-oriented employees
Using Agile management tools enables all team members to be caught up on what the colleagues are doing and not just in their own department.
To track your employees’ productivity, you can implement the following tools:
- Task management software: Jira, Bitrix 24, Trello, Jira;
- Time tracking tools: Hubstaff, TMetric.
Each employee knows what results each task brings to the team and the company’s development.
3. Saving employee’s time by implementing self-service
Both online services and offline stores understood the importance of providing their clients with independent service opportunities. Amazon’s checkout app for stores and Sainsbury’s shopping innovations proved that retail is already successfully innovated by the technology, with other markets ready to follow.
What are the possible smart self-service opportunities?
Internet of Things enables clients to use touchscreens to complete purchases. These devices are connected to the company’s CRMs, which automatically generate reports on customers’ activities. Also, users might soon be able to connect their smartphones to local networks in online retail and use them to navigate available offers.
4. Using innovative business models
Business owners don’t have to stick to traditional methods of developing and selling products. Digital transformation enables companies to explore various business models — let’s take a look at each type below:
- Outsourcing — instead of hiring employees to offices, business owners can hire offshore companies and communicate to them via messengers, video conference software and get detailed digital reports on the progress;
- Pay-Per-Use — users can freely browse the service and product but if they want to use the feature, they need to pay for that particular feature or a full subscription;
- Subscription as a Service — users pay on a regular basis and receive access to the full functionality of the services.
Business owners don’t have to stick to traditional methods of developing and selling products.
5. Keeping track of competitors
Digital business is easier to track and analyze. The statistics on app downloads and website visits are public, and you can even get in-depth analytics on your competitors’ target audience. Websites like SimilarWeb provide comprehensive analytics even in the free version, going even more in-depth in the full paid edition.
Similarly, you can track the social media activity of your competitors, following what they post online and monitoring the feedback. Of course, it’s worth remembering that your activity is just as public. Still, that’s another advantage of digital markets — competitors exchange best practices and end up growing together.
Digital transformation has already been apparent for at least 10 years. Booming technology startups have been conquering the markets at a rapid pace, achieving $100 million in revenue only in a couple of years.
It’s apparent that digital transformation provides fuel for businesses to move faster and achieve more. The best thing is, digital transformation can either fit into an existing business model or inspire companies to pivot into new directions — it’s available to everyone.