Digital transformation is assisting businesses to explore new ways of managing work, collaborate more effectively with their workforce, and gain faster information access. Today, enterprises which have embraced digital technologies are able to attract the best talent, optimize their core business processes, and improve customer satisfaction. Businesses can stay more competitive with better process automation, experience better consistency in workflows and boost their overall efficiency and productivity.
87% of companies believe that digital transformation is a competitive opportunity.
Let us take a look at how companies can really reap the benefits from their digital transformation initiatives –
What is digital transformation and its importance to business?
Digital transformation is essentially the integration of technologies into all the key areas of business that results into foundational changes in the way businesses operate and provide value to their customers. In other words, digital transformation may also be defined as acceleration of business activities, core competencies, processes, and business models to leverage the opportunities and changes resulting from digital technologies and their impact in a strategic manner.
This type of digital business transformation is influenced by different factors such as innovation in technology, change in customer demand, and behavior along with other external factors in the environment. There are many reasons why organizations opt for digital transformation, but the key reason is survival amidst the tough competition. Let’s look at some of the key statistics that indicate the growing importance of digital transformation among enterprises:
- As per reports by Forrester Research, it has been predicted that almost half of the business revenues will be influenced by digital technologies by 2020.
- MIT Center for Digital Business has indicated that companies adopting digital transformation are likely to be 26% more profitable, more than their existing competitors in the industry and 12% more greater market valuation.
- Most of the research reports also indicate that organizations that depend on legacy systems are becoming an obstacle in the adoption of digital technologies and in harnessing their vast benefits, which is hindering their business growth and performance.
Role of Digital Transformation in Boosting Business Value
Organizations have to drastically shift their focus from just selling their products to enhancing the overall customer experience throughout the buying journey. As a result, they have started relying on more sophisticated channels such as digital technologies to understand the needs and meet the demands of their customers effectively. There are other ways in which companies are able to harness some of the opportunities created by digital transformation –
Empowers decision making and knowledge management
Enterprises need to capture and maintain all the records of their day to day business operations including emails and project related outputs, which form the basis for decision-making for the present and the future. The use of digital tools and technologies in businesses helps in facilitating greater exchange of ideas and best practices among the employees and the management.
This can help in making the business processes more smooth and agile. Especially the application of business intelligence tools can help enterprises in having access to huge data sets, which may be used as a basis for predicting business trends and taking vital business decisions.
Provides real time access with better customer experience
Digital transformation plays a vital role in meeting increasing customer demands and expectations by boosting the level and depth of interactions with them. Businesses can be more customer-savvy with the use of digital technologies and remain in constant touch with their customers. As more organizations embrace digital transformation, customers will be able to have real-time access to different products and services with decreased response time. The turnaround time will be faster with digital processes taking over manual processes to meet customer expectations on demand.
Drives creativity and innovation within the enterprise
Enterprises must be able to deliver a unique digital experience to their customers for which they need to rely on innovation. The main idea behind digital transformation is to lower costs of operation and continue to deliver an exceptional customer experience. Today more number of enterprises are seen moving from the legacy systems towards embracing new and modern technologies such as the cloud, IOT, Big Data among others. These technological innovations have led to improved speed, greater business agility with less cost and encourage creativity to boost the overall productivity of the organization.
Build new capabilities and promote collaboration
Digital transformation helps in creating an ecosystem where employees need to work together by collaborating across different levels which helps in breaking down silos. This helps in improving learning from each other and work consistently and respond more quickly to the changes taking place rapidly within the organization. Employees spread across geographical locations can have access to all the collaboration tools including documents, contacts, information, skills, experience, and ideas that can provide greater value to the business.
Digital transformation involves restructuring of the business processes, but at the same time it needs to provide a greater customer value proposition. It’s essential that enterprises that wish to succeed must use more digital content, change their internal operations, and use customer engagement tools to boost their business prospects.