Digital business transformation is about more than simply swapping analog processes for digital ones. It focuses on optimizing and reengineering business processes with customer experiences, worker satisfaction and stakeholder value/outcomes in mind.
It also encompasses new ways of doing business and tapping into novel revenue sources and information-powered ecosystems of value. That’s why a holistic, enterprise-wide approach is needed.
Defining the Goals
Defining the goals of digital business transformation is a complex task. The goals are typically a mix of customer experience optimization (including product and service innovation) and operational efficiency (e.g. cost savings) and new revenue sources.
However, it is also important to take a holistic approach towards the goals with the edges in mind. For far too long optimization efforts (whether in business processes, marketing or customer service level improvement) have been done in siloes – and this needs to change.
The fact that everything is connected is key as well: the evolution of technologies such as social business, cloud, mobility and big data accelerates disruption, business innovation and changes in human behavior. But the broader ecosystems are changing as well; economic shifts, demands from partners that want to adapt, regulatory or governance changes and geo-political events speed up changes overall. It is therefore important to think strategically about the broader context and the interconnectedness of all aspects of digital business transformation.
Identifying the Needs
A successful digital transformation requires more than just implementing technology tools. It also involves rethinking internal processes and creating a culture that supports new methods.
Moreover, a digital business model encourages companies to rethink existing operating models, experiment more and become more agile in their ability to respond to customers and competitors. This means breaking down traditional silos among departments. For example, marketing and customer service teams can collaborate to run campaigns using a platform like Kissflow that streamlines and tracks the status of each request.
Digital innovations are impacting business at a massive scale and speed, so businesses have to be prepared for future shifts that can potentially disrupt their current strategies and models. This makes it essential to have a comprehensive strategy and a holistic view of the entire ecosystem. Otherwise, a project may be stalled by unanticipated challenges and resistance from stakeholders. This is why planning for change is such an important aspect of a digital transformation project.
Identifying the Resources
Once the goals and needs are set, identifying the resources needed to implement digital business transformation should be the next step. This may include internal training to help employees adopt new skills, or purchasing new technology to support the process. It can also involve defining investment goals that will provide an estimated ROI over a specific period of time.
Increasingly, businesses are moving to digitize their operations because customers want a more valuable experience. Whether it’s through social media or an online customer service portal, making interactions and support seamless is key. Then there are the efficiencies gained from digitalization, like eliminating roundabout communication and slow response times.
The data gained through digital transformation can provide a powerful insight into customer behavior and needs, and can enable the company to be more agile in its strategy. This can include leveraging structured and unstructured data to create more effective, personalized content for all channels. It can also be used to improve internal communication, enabling teams to collaborate more effectively and reduce friction between departments.
Developing a Plan
Once the strategy is clear, a detailed implementation plan should be drawn up. This should include milestones, resources and budgets for each digital initiative. It should also outline the underlying processes and workflows that will need to change in order to support these initiatives.
Aside from the technology, it is important to consider how these changes will impact people within the organization. This includes employees, external customers and suppliers. It is important to communicate well in advance, form training schedules and provide regular updates. It is also crucial to prepare for skepticism and resistance and plan accordingly.
Ultimately, digital business transformation is about embracing innovation and changing the status quo. It is about allowing companies to be more agile and faster at discovering problems and delivering solutions. It is about enabling them to become more competitive and resilient in a world where change is accelerating at an unprecedented rate. The best and most successful companies have a “why not?” culture that encourages experimentation and learning from mistakes.