It’s not as difficult to understand what is a digital transformation (DX)? Something about computers, the Internet, and pixels. Well, actually, the term is much more complex as it includes various strategic aspects for businesses. It represents a global shift in attitude to work, organization, and management. DX already changed our leisure and daily life. It quickly reshapes the educational and professional spheres, as well.

To understand the importance of digitalization, just look at a few insights derived from reports of leading analytical firms, including IDG and IDC:

  • In 2018, IDG published a report with info that 45% of companies plan to adopt the digital strategy. Wherein, 37% of teams have adopted it
  • The same paper mentioned top technologies implemented by companies. Big Data and mobile apps were the leaders with 59% each.
  • Among the industries that have adopted DX or plan to do it, services niche (95%), the financial sphere (93%), and healthcare (92%) are the most progressive.
  • Another data company called IDC reported in 2018 that two-thirds of 2,000 companies want to move from offline to online and digital strategies.

Modern businesses realize the benefits of DX and plan to perform it. Still, the share of already transformed companies is smaller than the percentage of brands that are stuck at the preoperational stage.

Fine. Digital transformation is vital. But what is it, actually? How do managers understand this term? What does it mean for your own business? How and why you should adopt this strategy? Let’s find out together!

What Is Digital Transformation?

Formally, DX is about implementing digital tools and methods into your business processes to reach better productivity and/or profitability. The strategy is mainly based on the customers’ demands as modern people are highly tech-savvy and digital-oriented. Rosetta Consulting has found that teams with loyal and engaged clients are more successful at identifying the exact stage of the customer journey, better at marketing customization, and more focused on automated analytics.

The thing is that DX doesn’t change what your business does. Instead, it’s about how employees complete core tasks and managers control this process. Thus, regardless of the industry, each digitalized team have a few common features:

  • Less pen and paper, more online tools.
  • Fewer archives, more cloud storages.
  • Fewer phones, more smartphones and tablets.
  • Less specialization, more collaboration.
  • Less stagnation, more innovations and trends.

One of the most important shifts relates to business focus. Digital transformation enables data-driven and customer-centric strategies, mostly. 

Talking about the understanding of DX, we can look at the already mentioned report by IDG issued in 2018. For example, 52% of the respondents replied that they see digital businesses as ones with modern tools such as mobile, data access, and AI. 49% of companies think that digital shift focuses on better management through data availability. Finally, 46% mentioned that any digital business should aim at meeting customers’ expectations.

Why Your Business Should Transform?

As you see, there are different opinions and different core advantages. But most of all businesses accept that DX is required now. Why? Well, the first factor is a competitive advantage. If your team is involved in services, finances, healthcare, education, tech, manufacturing, retail, governance or any other more or less modern sector, your market rivals think about DX, adopt it right now or have already implemented it.

The Digital IQ Survey from PwC featured only 33% of digital-oriented teams in 2007. This number was 68% in 2018. Still, if you need more reasons to opt for digitalization, let’s look at them.

1. Better Business Processes

Modern technologies can streamline various core operations. Thanks to real-time access from various devices, employees can keep contact and find essential data quickly. It’s an important feature, according to the research by MIT SMR and Deloitte, as 90% of workers want to get timely access to necessary data. As a result, DX improves collaboration, productivity, and decision-making. Also, it simplifies performance tracking.

2. Better Products and Services

Similarly, elaborate and tailored software can increase the team’s productivity, improve quality, and reduce costs. For instance, automation features take care of routine stuff so your employees can focus on interactions with customers or creative work. Machine learning with constant analysis of Big Data also improves the overall quality of products because you can make necessary changes based on comprehensive reports.

3. Better Customer Experience

Finally, the efficient work of your team and top-quality products/services have a great impact on the clients. First of all, they receive exactly what they want. Also, customers appreciate accurate, regular, and personalized support with attention to details. Using customized CRM systems that you can order from devs in top outsourcing countries, businesses improve user experience. Plus, it becomes possible to meet new demands quicker and find more resources for UX improvement.

How to Perform Shift Successfully?

With knowledge about DX, we have only one uncovered topic. You need a good plan and enough resources to adopt the described strategy but it has all the chances to boost the business.

The essential steps are as follows:

  1. Prepare your team. Each employee should clearly understand why and how you implement new software and/or strategy. If workers consider these changes as unnecessary, you may want to start with improving their digital IQ.
  2. Do research. Everybody in the team including yourself should be able to answer questions like “Why we transform?” and “What elements we transform?”. Thus, it’s crucial to analyze processes and plan the strategy of DX.
  3. Create comprehensive software. Surely, you can order it from external devs but always do your best at the planning stage. Foresee all the important functions and design elements of new software. Don’t forget about training for employees.
  4. Connect systems. Most likely, your business use one or several apps or digital tools. Because of high complexity, companies don’t renew software often so be sure to plan all connections between new and legacy systems. Also, plan upgrades for apps.
  5. Evaluate results. Digital tools aren’t magic wands that boost profits at once. They can be unprofitable so you will need to make certain changes. Set evaluation/reporting tasks to always know what you need to modify or upgrade.

The main insight is that DX is all about the entire team. Ensure that workers understand the changes and appreciate them. Don’t hurry up, listen to different opinions, and focus on primary goals of the business. Digital transformation is useful but only when you do it properly.

Bonus: A Lesson from Amazon

In conclusion, we want to provide one representative example of digitalization importance. In 2005, Amazon was a small online bookstore with not as impressive performance. But now it’s one of the world’s trading giants with a total value higher than all land-based American retailers combined. From 2006 to 2016, Amazon experienced insane 1,934% growth from $17.5 billion to $355.9 billion! Yeah, this company is all about DX. That’s it.