Digital Transformation - The New Era for Business Simplification
Digital transformation is probably one of the haziest terms in the professional world. Many are still struggling to get a clear picture. Is it about keeping pace with cutting-edge software? Or does it mean creating more values in core business? Or is it about innovation with emerging technologies? These sorts of questions are leaving many stones unturned. So let's get going with the question: What is digital transformation?
Digital transformation is all about the fundamental transformation of business and its everyday tasks along with overall processes, abilities, and business models to completely grab the potentials of advanced technologies and their emerging impact across society, with keeping an eye on the future revolution.
In simple words, Digital transformation is all about making changes in the cultures, organizations, ecosystems, business models, and operations by integrating advanced technologies and smart processes.
History is Boring! But Numbers Aren’t.
The global digital transformation market size was measured at USD 284.38 billion in the year 2019 and is projected to grow at an average annual growth rate (CAGR) of 22.5% from 2020 to 2027.
As per the new analysis by Grand View Research, Inc. the digital transformation market worldwide is anticipated to reach USD 798.44 billion by the end of 2025.
Digital Transformation Market Size
Additional key outputs from the survey.
- The hosted deployment section is anticipated to rise at a CAGR of 22.3% over the period analyzed.
- The healthcare section is anticipated to rise at a CAGR of 19.5% over the coming eight years.
- The Asia Pacific local market is anticipated to rise at the maximum CAGR over the coming eight years.
- North America showed up the largest share in 2016 among others in this region due to increasing customer interaction through smart devices.
Following are some of the factors that will comprehend key concepts about who and what areas need to be affected by digital transformation.
Areas to Target
#1. Customer Experience
Today’s consumers are more likely to be known by their personal choices and order histories. Accenture says, 75% of consumers accepted that they are happy to go for a company that acknowledges them by their name and suggests products based on their purchase history.
So to drive digital transformation, listen to your customers before establishing anything of customer’s interest, and focus on customers’ jobs-to-be-done. Watch out for every aspect of the definition of customer experience. You can leverage comprehensive CRM systems to make the most out of this opportunity.
#2. Operational Processes
You can transform digitally by either changing the existing business operational processes with cutting-edge technologies or by making a fresh, creative one. Better flow of information, improved collaboration, and teamwork can boost the value of operational Processes.
Tapscott, a Canadian business executive underlines the potential of using digital techniques and tools to change and reorganize existing business processes.
#3. Business Model
Digital transformation is an empowerer for digital business models that opens new doors to build products, discovering clients, creating value, and revenue. All of these can be blended perfectly to revolutionize any company from traditional to digital.
Transform the way businesses function, from the go-to-market approach and value proposition to the ways towards making money. Leverage unique revenue generation methods. Change old school processes to advanced ones. Netflix, Starbucks, and UnderArmour are the best business model examples that have created new service approaches by being user-centric.
#4. Business ecosystem
Digital business is quite complicated and to flourish, businesses can’t be strictly focused on internal integration. Involvement in a business ecosystem is nitty-gritty. Businesses need to realize the majority of ecosystems are doing well as they are assembling other associations or even competitors to deliver value. It is essential to specify types of interactions within a business ecosystem; such as operational, contractual, financial, proprietorial, products/services, and data interactions.
Develop internal solutions and systems, applications, incorporating external trading partners, suppliers, customers, third-party data service providers, and all their respective technologies. A dynamic digital ecosystem, with interconnected networks, necessitates reliable communication among customers and trading partners.
#5. Organizational culture
Transforming a business culture that a company has long inherited is like initiating a business from its scratch. No doubt to say, it’s a daunting task. Business culture can be symmetrical based on technology as well as people. Technologies can’t help solely. To drive digital success, one should create a workforce that will amend the transformational shift.
With the right emphasis on culture formation and ethical use of technology, businesses can better engage themselves for a wealthy digital transformation.
Technologies to Make a Move
#1. Social Media
Most customers in this modern age turn to social media to raise an issue, post feedback on the brand’s customer support team, or look for assistance. It will ultimately aid in monitoring customer interactions to recognize trends and their wishes. So you can serve them accordingly. If any satisfied customer can give positive feedback, you can ask them to post a review on one of your social media platforms. It will also help in marketing your brand so you don't need to spend much on marketing strategies as well.
#2. Cloud Computing
As an effective result of the world’s digitalization, consumer behavior is fluctuating accordingly, this is why organizations have to transform and adapt to digital techniques. Businesses should leverage the best of cloud computing to establish scalable digital transformation frameworks. Cloud empowers innovation by providing a suitable set of APIs for developers; especially helps SaaS applications. The software can be sold as pay-as-you-go.
Cloud computing offers functional programming, analytics, and low code programs that can be vital for informed decision-making. This aided a business to deploy enterprise-ready solutions swiftly. This technology is paramount to encourage more integration and teamwork.
#3. Remote access and mobility
Extensive use of smartphones at the workplace and a hike in remote working help stimulate digital transformation attempts. You can collaborate with the customers or vendors by just having an internet connection through mobile.
Plenty of businesses are already leveraging on-demand video and video conferencing to execute training and assisted debugging tasks. Even accounting professionals are harnessing this technology in terms of precision and speed. All credit goes to mobile apps for real-time monitoring and reporting.
#4. Big Data
Big data analytics enables organizations to stay informed about various groups of customers. This detail can be regarding what they are doing on the websites, what they are buying, and how frequently. Based on this information, companies can perform changes to address the future needs of the targeted audience.
Businesses need to adopt big data and data analytics that describes everyday behavior, keeps track of everything including what anyone likes to do and how much time an individual is spending on their favorite activities.
#5. Internet of Things
IoT offers new ways to sense and manage physical products as well as real-world experiences. With the internet of things, every device you use all day is connected. This aids organizations to comprehend fresh ways to interact with customers, no matter what device a customer is using. Many experts anticipate that the number of Internet-connected devices will rise to more than 80 billion by the end of 2025 and this is surely making IoT grow.
Owing to IoT, companies can work in digital ways by conveying more real-time information and decision-making power to the employees. With IoT transformation, everything is incorporated securely into business processes and the execution of tasks.
#6. Artificial Intelligence
It can assist businesses to be more creative, versatile, and adaptive than ever before. The assurance of swiftness, ease, and cost optimization, while streamlining complicated operations and systems, makes AI one of the most substantial digital transformation drivers. Although many are considering it as a future technology, it has already arrived and is being leveraged by a plethora of organizations to optimize their business.
Self-guided cars, face detection and recognition, intellectual computing, chatbots, and many others are examples of AI technology that has the ability of a machine or software to develop human-like thinking.
Accelerators of Digital Transformation
#1. Agile Methodology
With the use of agile methodology, businesses can deliver products and services exactly how customers need them. They can welcome ever-changing customer requirements even late in the development process.
#2. Identity-Centric Security
This security offers an ability to limit personal data access to ensure that it is only used for the purpose for which it was gathered. Security will be improved when it comes to the usage of apps, tools, and safe information exchange.
#3. API Management
APIs enable individual developers and large-scale enterprises to integrate their solutions with other businesses to deliver automated routines, innovative business ideas, and enhanced productivity. APIs are urging a new wave of revolution evolved based on sharing services.
A software development and operations technique to empower rapid product development and simple maintenance of existing deployments. DevOps encourages concise, more manageable iterations via adapting the best practices, automation, and advanced tools.
Some Misperceptions (So you can avoid them)
#1. Digital transformation is more related to technology only
Beyond the significance of technology, business structure, transparent culture, employees, advanced skills, and much more are vital to driving the digital revolution; and big digital companies have already experienced it.
#2. Leader/Senior executives are the only ones responsible for digital transformation
Some businesses applied reverse mentoring strategies where middle-managers and employees are training top-management on social networks and how to drive digitalization by implementing next-generation technologies.
#3. Digital transformation means better operational activities
Being excellent in what you are doing and establishing a business that functions very well - both are poles apart. Here what makes a difference is a strategy. A relevant strategy that enables companies to modify according to the competitive environment is what digital transformation needs to focus on.
#4. Extensive use of digital marketing tactics for Digitization
Interactions, technologies that enable rapid development, and a leader that motivates in driving the digital revolution, are the much-needed elements rather than the digital marketing only.
#5. Digital transformation means short term results
You can't accomplish your desired outcome in just a few months to get fully transformed digitally. Staying focused on a goal despite getting disturbed with us and downs, good leadership, flexibility to adopt new things, internal and external connections, all these elements are significant to keep going on a regular term towards transformation.
Covid-19: Empowering Digital Expansion.
Covid-19 makes the world go into isolation. To slow the spread of this virus, social distancing is one of the most effective ways. As a result, most aspects of our day-to-day lives are amended.
Digitization is playing a key role to bridge the gap created by lockdowns. Without digital technology and advanced tools, one can never be able to work, learn, shop, and much more. Businesses that had invested in digital business models are in a better position than those which had not.
Post Covid-19, to adjust to the new normal, we have seen some key changes playing out in the wider business sphere.
- Significant investment in advanced technology.
- More focused on customer and employee experience using digital abilities.
- Defining technological priorities.
- Observing technology as an opportunity to drive revolution.
- Employing automation to deliver contact-free services.
- Investing highly in cybersecurity.
Digital efforts must be redefined based on the significance of the current environment. New hurdles and possibilities may also come with multiple emergencies. The key is to keep going with different technological experiments to establish digital solutions. With the accurate technique, organizations can come forward from the battle, more agile, more powerful, and more user-oriented than ever before.
Are you All-set to Transform your Business Digitally?
Digitization is relentless and affects each industry niche positively. This revolution is capable of shaking the businesses’ histories like never before. Civilians are more sophisticated when it comes to the use of technology compared to businesses. It is necessary to exceed old school business processes In this progressive atmosphere if you need to build something big with skilled professionals.
Digital transformation enables organizations to mitigate riskiness and help in managing disruption like market variations, business re-engineering, and operational environment that are completely surprising, and can lead to an uncertain outcome.
Organizations need to leverage the great potentials of advanced technology to rival adequately in this ever-changing economy.