Digital transformation is a universal answer to one of the eternal questions of any business: how to do it cheaply and well. You will learn how to quickly meet the dynamic requirements of the market, start a comprehensive business modernization, and why digital transformation is now more critical than ever.
What is digital transformation?
We increasingly hear about digital transformation, but few people know it and how to use it. So let’s try to figure it out.
Digital transformation is a significant business transformation that affects both the change in the operating model and the infrastructure of the enterprise, based on digital technologies and flowing under the influence of three main drivers: changing user demands, the development of technology, and increased competition.
Today, there are practically no companies left that digital technologies would not influence. Most of the transactions are performed online: applying for a loan, buying from an online store, obtaining legal advice, or viewing data on expenses on a bank card.
Objects of digital transformation
Let’s consider what objects of digital transformation exist:
First, people – users are increasingly using technology to work together or to achieve goals and objectives. For example, to develop or create products, raise funds for projects on crowdfunding sites, attract experts voluntarily using social networks, blogs, forums, etc.
Processes – there is a transition to new technological tools that can qualitatively improve the efficiency of the management model. This includes the use of cloud storage of data and applications, the introduction of artificial intelligence, etc.
Products – new products are emerging that are the result of a successful digital transformation. For example, augmented reality, 3D printers, open-source products, etc.
The essence of digital transformation in business.
Throughout its history, humanity has used tools: first to survive, then to change the world around it. The tools helped us achieve what we wanted, which provided the basis for the further development of thought and cultural progress. Our species is smart because we have learned how to use the tools we have effectively. Effective means cooperation. And today, when we discuss technological progress – whether it depends on the Internet, robots, new data, or something else – we forget that everything depends on people and culture. And then the question is how well they work together for the result. And this is precisely the essence of digital transformation in business.
Digital transformation in action
The future has already arrived. In all large world companies, traditional digital spaces have acquired the form of “cloud” systems. Like everything ingenious, this principle is very simple and successfully applied: storage of large amounts of data, the Internet of Things (the concept appeared back in 1999!), RAD programming (the concept of rapid software development) – all these developments in one way or another reflect these innovations and are examples of their successful implementation.
Why digital transformation is needed
Just as a living organism adapts to changing environmental conditions, digital transformation allows you to respond to external economic factors and market dynamics quickly. Its business benefits are obvious: the speed of decision-making and operations is increased, labor costs and other costs of performing actions are significantly reduced. As a result, the cost of the product (whether it be a product or service) decreases, and the company’s net profit from its sales increases.
Digital competition, like online collaboration, is gaining momentum. According to a study by Oxford Economics and SAP, 84% of surveyed representatives of global holdings believe that digital transformation will be critical to the survival of companies over the next five years. The indicators of companies that have already implemented digital tools in their business processes and customer service confirm the forecasts of specialists. Moreover, these numbers are far superior to those seen for organizations that remain in the shadow of digital trends.
Customers have become much more demanding of the quality of service and purchased goods. Today, the buyer wants to have a complete set of options online. At the same time, they should be as easy to use and as quickly as possible to solve his problem or find an answer to his question. Nobody wants to waste time waiting for the operator’s answer (which, by the way, can drag on for an indefinite period): even if they do not mind listening to “Let my people go,” after the fifth time, it will only annoy them. So if you run an insurance company, make sure to implement good quality insurance software; if you need to provide your customer with a lot of information, make sure to use chatbots, and so on. Don’t forget about social media too. Keep in mind that it is digital transformation that helps to satisfy the demanding requirements of the client.
Benefits of digital transformation:
- The enterprise will be able to automate many processes; thanks to this, it will improve the work. In this way, the organization will be able to make better use of its human resources.
- Thanks to the automation of many processes, the business has the opportunity to profit from those sources that were previously unavailable.
- With the automation of processes, the enterprise will have the opportunity to listen to customers’ recommendations, take into account their preferences to provide better services in the future. This approach is essential for today’s clients.
As you can see, there are many benefits to digital transformation. That is why businesses should start introducing new technologies now so that later it does not get lost against the background of other commercial organizations.
Today, companies of any level are forced to adapt to changes in the global economy and use innovative approaches, be it a small enterprise or a large company with a network of branches. Otherwise, the competitor will profit, and the business partner will find another contractor, more flexible and adapted to modern business technologies.