What is Digital Transformation?

What is Digital Transformation?

It seems everyone is talking about digital transformation. But what it is?

Short note – Your existence hinges on the intensity of your digital initiative and your ability to master transformational change.

Executing a digital strategy is more than just buying new technology

Long Note: Digital transformation is the shift from a legacy approach to encouraging new ways of working and thinking using digital, social and mobile technologies to improve the experience of your employees, customers, suppliers, partners and stakeholders.

In Other words: Digital transformation is the innovative use of technology to improve a business. This includes leveraging software to streamline processes, increase productivity and enhance every relationship within your business—customers, employees, vendors, partners. That’s it!

All of us have experienced legacy, rigid and structured technology based business systems, mostly built around repeatable steps—like a product line view of business. Core processes, like receiving invoices, paying vendors or concerns over inventory have to be done, but technology has exploded over the last few years and has changed how we work.

We now live in a world of instant communication and feedback. The supply chain has changed forever and those that do not innovate, evolve and literally “transform” eventually become extinct. Stark examples of companies that were disrupted and did not evolve include Kodak, Blockbuster and Blackberry. And this list will grow longer unfortunately.

Navigating the Change

The most successful companies employ strong leadership to turn digital initiatives into digital transformations. Strong leadership pioneering digital initiatives create digital maturity, and those with digital maturity naturally outperform their competitors.

According to studies, many organizations are focusing on three key areas of their enterprise: customer experience, operational processes and business models. However, each of these three pillars also has three unique elements that change. In total, there are nine elements that form a set of building blocks for digital transformation.

Transforming the Customer Experience
From understanding the customer better and extending a brand more effectively, organizations are building loyalty, enhancing sales and leveraging social media and e-commerce tools to transform the customer experience.

Transforming Operational Processes
Companies are transforming internal processes through digitization, worker enablement and performance management.

Transforming Business Models
Companies are not only changing how their functions work, but are also redefining how functions interact, redefining boundaries and activities.

Digital transformation takes strong leadership to drive change, and a vision as to what needs to be transformed. Whether it is the way individuals work and collaborate, the business processes within and across organizational boundaries or in the way a company understands and serves customers, every organization should be constantly identifying new ways to redfine the way they work in the digital age.

 

Opportunities & Challenges

Digital transformation can extend the reach of your company, improve decision-making processes and accelerate development of new products and services. However, the rapid adoption of technology can disrupt traditional business models and wreak havoc.

Digital transformation can be the most daunting challenge in change management, impacting all levels of an organization. Leaders must ensure that technology-enabled change ignites productivity and releases significant competitive advantages. Leaders need to understand where and how the fundamentals of their current operations can be affected by agile new technology or unproven business models.

 

Summary

Digital transformation is the reinvention of an organization through the use of digital technology to improve the way it performs and serves its constituents. Digital refers to the use of technology that generates, stores and processes data.

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