What is Digital Transformation?
Digital transformation is the latest evolutionary step for companies of all sizes and from all industries. It is a powerful business trend that will shape the future of the modern economy.
With the explosive adoption of smart technology and the accompanying massive increase in mobile data traffic, the need for digital transformation to improve business performance is an imperative that every company needs to embrace.
Digital Transformation Growth
According to market research study the global digital transformation market is expected to grow to USD 3,739.06 Billion by 2030, which is up 23.6% on 2021.
When you look at the biggest business trends, digital transformation is close to the top of the list. The Google Trends graph below illustrates how the search for digital transformation information has grown over the last decade.
There’s no time like the present. Mobile traffic is outpacing fixed and will be around for a while. If nothing is done, more and more of your business processes and operations will be disrupted by the impact of technology on your organisation which may have huge financial repercussions.
This is where digital transformation comes in. Digital transformation is about harnessing technology to enable your business to realise its goals, objectives, and vision. It involves upgrading your technology, becoming a more effective business, and creating value for your customers.
Digital transformation is not a substitute for innovation. Digital transformation is innovative! It’s about keeping up with digital competition worldwide and progressing rapidly to today’s standard yet measured against tomorrow’s expectations.
What is Digital Transformation?
Digital transformation is a broad term that refers to organisations adopting new digital technologies, such as cloud computing and digital automation, to achieve business agility. This often involves introducing new technologies and processes that are typically invisible or transparent to the customer due to their presence in the virtual world. As an organisation adopts new technologies – including social media technologies – it will have more opportunities for employees and customers across the globe.
Organisations are transforming themselves and their workforce, which is one of the significant benefits of this process. Digital transformation can help employees work from anywhere worldwide, gain new skills, and increase productivity.
Digital transformation is a strategic and long-term change rather than a short-term project. It will take place over multiple years or even longer as it involves changing an organisation’s technology, processes, and organisation. Digital transformation can be applied across all departments in an organisation or for specific sectors, such as marketing or finance.
Digital transformation can be achieved with four different types of people:
Digital natives are people born or grew up using digital technologies and have no memory of a time before the internet. These people can quickly adapt to new technologies that take advantage of the Internet of Things (IoT), such as smart homes, cars, appliances, and wearable devices. These people are already living in the world we aim to live in in 10-20 years.
Digital immigrants are people who have previously used digital technologies and therefore have a memory of these. However, they may need to be more skilled to take advantage of emerging technologies such as IoT. These people can also benefit from digital transformation as they can use digital technology to enhance their work and shape their brand.
Digital exiles are people who previously used other technologies but now have no idea how to use technology or have forgotten how to do so. These people can be people who previously worked in an industry where they used technology but are now retired or unemployed. Digital transformation could help these people to get back into employment and improve their prospects.
Digital nomads are people who have chosen to become digital nomads as they dislike being tied down to one place. These people are working globalised jobs and therefore do not have a fixed home but work instead wherever they like. Digital nomads can use digital technology to work from wherever they want, work in a way that suits them, and hire freelancers as needed.
Ways in Which Digital Transformation Can be Achieved
There are five main ways that a company can use to achieve digital transformation;
1. Digital services involves moving from physical and download services to digital ones.
2. Digital platforms use technology to create a brand platform that is engaging and relevant to the audience. It allows companies to build an online presence, including social networking sites and blogs.
3. Digital transformation involves the use of new technologies in different ways. It might include using computers, smartphones, and cloud-based services to provide customer service or assisted customer management systems.
4. Digital marketing is using digital technology to communicate more effectively with customers and prospects. This can include using digital channels to promote a brand, product, or service.
5. Digital ecosystems use popular networks and platforms to connect business processes with customers, partners, and resources. It allows companies to rely less on intermediaries such as lawyers, accountants, and bankers. Companies that want to become digitally transformed should choose partners they can connect with easily and manage them more efficiently.
What are the Objectives of Digital Transformation?
Digital transformation involves the following
Companies must relentlessly invest in digital technology to compete in the rapidly evolving and changing world. This means developing new products and services that are better, more convenient, and more accessible to customers. It also means keeping pace with customer expectations changes so that they can find your products and services better than your competitors.
Investing in security for digital assets
The digital world is a digital place – so companies must protect the information they hold and the resources they use digitally. An effective security strategy can help protect the company’s data, intellectual property, and resources against external threats and internal fraud or misuse.
Ensuring digital adoption.
Digital technologies have become a critical part of business processes. Companies that want to remain competitive will need to make them accessible to all employees at all times so that they can use them more effectively.
Coordinating and leveraging IT resources
Corporate IT and Information Technology (IT) departments are often under strain as they try to keep up with the pace of digital innovation. To do this, they need to align their workflows and systems so that both the companies they support, and their customers benefit from these changes. They must also think strategically about how technology is used within their business to improve efficiency and reduce costs.
Offering a more modern workplace
Companies must offer their employees a relevant workplace equipped with the latest technology. They must think about how this will help them attract and retain employees, encourage productivity, and engage with customers.
Examples of digital transformation
Retail is undergoing a transition to digital, where about 70% of retail sales are now done online, and there are several retailers, such as Tesco, with more than half of their business being conducted online. Online shopping brings customers to retailers more quickly and allows them to find out more about the products they want before deciding whether to buy them. Online shopping also means that products are cheaper due to removing costs such as storage, transport, and retail premises.
Banking is undergoing a digital transformation thanks to the popularity of mobile payment apps and online banking. These new technologies allow customers to make transactions more quickly and easily. Banking is also changing because of new digital banking services, such as robo-advisors, which help customers to manage their money without having to go into a bank or speak to someone on the phone.
Manufacturing is also a similar transformation to banking, with more factories embracing technology and moving towards suppliers that provide digital services. There are many suppliers of computer-aided manufacturing (CAM) software systems and other digital tools.
Energy is another industry that has undergone a massive transformation because of the rise of renewable energy sources such as wind, solar and tidal power. As a result, different forms of fossil fuels are now being used in energy generation and solar energy.
Online media has also experienced a transformation through the use of different digital technologies, such as social media, which has allowed companies to reach audiences more efficiently. These new technologies enable brands to reach their target audience more quickly, cheaply, and effectively. Companies are using digital platforms to create something engaging and relevant to an audience or consumer base.
Some companies are also trying to become digitally transformed. For example, Goldman Sachs is using its new online investment platform, GSConnect, to help clients change how they invest their money through digital technology. Using payment apps like Venmo and Square Cash, GSConnect allows clients to quickly transfer money to their broker or advisor using their mobile phone. The service enables brokers to access more types of investments in an easy-to-use digital platform which could change how they do business.
Another example of digital transformation is when the ride-sharing service provider, Uber, decided to use technology to provide cab drivers with new tools. Through the use of a smartphone app and integration with GPS, the Uber app allows cabbies to track where their customers are and pick them up on the move. This technology allows cabbies to change how they manage their business by getting paid for being available on demand. The mobile app also allows customers to pay their cabbies and gives a feedback system allowing drivers to communicate quickly with their customers.
What are Some Core Components of Digital Transformation?
Here are four core components of digital transformation:
It is essential for leaders to have a vision for the future within the organisation and to understand the risks associated with adopting digital transformation and what benefits it will bring to their organisation.
Innovation and Digital Transformation
Digital transformation requires the deployment of technology within the organisation, usually in a modular fashion, which allows for the quick deployment of new technologies that will enable organisations to adapt quickly to new opportunities and challenges. Gartner states, “Digital Transformation is not an IT initiative, but an organisation-wide initiative.”
Customer Experience Technology
Customer experience is a crucial component of digital transformation and starting with the customer is imperative. Companies need to improve customer value and create more positive experiences through digital interactions.
Organisational transformation can only occur when there is buy-in from senior leadership. This will include changing the organisation’s culture, changing the structure of the organisation, and removing barriers to innovation. These are all interrelated and will not occur in isolation (perhaps this is why it took so long for digital transformation to emerge?).
What are Digital Transformation Technologies?
Digital transformation is a series of changes in different technologies or platforms that helps businesses to function better. It includes changes in management, people, and even organisational culture. Once you decide to use digital transformation technologies, it wants new software, hardware, and an excellent user experience. Digital transformation involves the change of technology platforms, management structure, and culture. Here we will discuss some popular digital transformation technologies, including artificial intelligence, internet of things, cloud computing, and blockchain.
Artificial intelligence is the advanced technology that makes human interaction with machines easy. It is a software that understands human language. It understands the input and helps businesses process data to generate output. The use of AI in many industries has changed their traditional way of working. Industries are more comfortable and comfortable with the use of Artificial Intelligence. Artificial intelligence helps in giving results to companies within a short period. The practice of artificial intelligence has made businesses’ work easy and has also increased their efficiency.
Internet of Things
The Internet of Things is a network comprising many connected devices. It is a platform that helps in accessible communication between devices and allows businesses to gather data or information about their operations. Internet of things operates on the cloud, so it increases the level of security and also efficiency. Various industries are using the internet of things as it saves time, cost, and labour. It is one of the essential technologies that help industries have better control over business operations/processes.
Cloud computing stores and utilises information in a virtual format through the internet. The data can be accessed from any part of the world. This technology has been made easy from being used to other industries as it has brought positive changes in business operations. It helps in integrating into any industry very efficiently, which helps with the creation of new strategies. Cloud computing allows businesses to save money and time by enhancing their efficiency with minimum effort. Cloud computing also helps to improve data alignment within a business environment.
The digital transformation technologies used in modern technology are Big data, Social media, mobile, and the cloud. The use of Big data has given effective results to businesses as it has improved the decision-making process of a business. This technology helps analyse market trends, customer behaviour, and competition level. Big Data is one of the critical technologies that can help industries grow their business and improve efficiency. This is due to the fact that data and analytics help in better decision-making for businesses.
Social media platforms are used by companies to interact with their customers, employees, and even business partners. Social media platforms help businesses communicate better with other customers and employees and also allow them to expand their business market. Social Media has made the process of companies simple as they only need to communicate through social media platforms. They can also improve their credibility among people as they reach the maximum number of people. Social media helps people be aware of companies’ day-to-day activities and allows them to show new products used in business. Social media is one of the crucial tools or technologies used in business as it improves the quality of work.
Mobile Platforms provide easy access to information and data and give people and users a chance to interact with organisations. It enhances the efficiency of businesses by improving communication within different companies and with their customers. Mobile helps make the process more effective, easy, and comfortable as it helps to use apps to communicate with customers. Mobile helps provide information about the product or service of a business and allows users to access information.
Blockchain is an open, decentralised ledger that enables transactions, exchanges, and contracts to be automated and carried out peer-to-peer without needing third-party intermediaries. It is often referred to as the technology behind cryptocurrencies like Bitcoin. It has grown in importance and has been adopted by many companies to facilitate digital transformation. Blockchain can support various business processes, from managing assets and contracts to transparency and security, marketing, and legal services.
What are Digital Transformation Drivers?
The main drivers for digital transformation are:
Digital technologies enable companies to innovate quickly in response to customer demand. This is important because organisations that fail to innovate risk falling behind.
Breadth of Technology
Digital technologies such as robotics, artificial intelligence, machine learning, and the Internet of Things (IoT) have the potential for widespread, widespread transformation in all areas of business. New digital technologies will significantly impact business processes, systems, standards, and data standards.
Customers are increasingly accessing goods and services over the internet as they do not have to leave their homes or premises to do so. The volume of digital transactions is predicted to increase dramatically over the next few years. By 2025, we will be transacting more than three times the number of physical goods we currently do. This shift in how companies exchange information will require them to grow their technology capabilities and integrate them properly with their business processes.
Companies must ensure their customers always receive the best possible service. This means they need to take advantage of digital technologies capabilities, even if they did not develop them. Therefore, a company’s ability to adopt digital technologies is fundamental to a successful digital transformation strategy.
The adoption of digital technologies by companies is growing. The most active adopters tend to be large corporations capable of investing the financial and human resources required for the transformation.
What Makes Digital Transformation Important?
The digital world is going through a paradigm shift every decade. Companies follow suit as humans migrate from the physical to the digital world.
Digital transformation necessitates change to your workforce, processes, and culture to align them with new technologies. This means making fundamental changes in how you run your company which can be disruptive and costly. Yet there are attractive benefits, too: it’s about being where your customers want you to be – being mobile – and responding quickly, according to their needs.
Digital transformation can be achieved through strategies that span the digital, business, and IT worlds. To achieve this, your organisation must consider every aspect of its business – including strategy, operations, people, and technology – as part of an integrated digital transformation strategy.
The Significance of Culture in Digital Transformation
Digital transformation is a cultural cornerstone. How we live, interact, and do business is changing as we become more digitally connected. As the benefits of this digital age manifest, new challenges arise for our culture and identity.
Organisations must think about how to design digital transformations to create a culture that will positively shape the future of their organisation—developing the right digital transformation requires considering culture and what it means to your people. If there is alignment in your culture, you can assume that future successes will take more work to accomplish.
What are the Challenges of Digital Transformation?
Every business, organisation, or entity needs to make all the necessary changes to create a positive environment for their employees. Organisations have used digital transformation techniques to overcome these challenges to meet specific goals and objectives. Digital transformation techniques help organisations in improving their efficiency and increase customer satisfaction. There are specific challenges that organisations face while they are trying to use digital transformation.
Unstructured data is one of the challenges in digital transformation. Unstructured means not having a structure, and it has less structure to improve organisations’ efficiency. It also helps employees in getting a better idea about the company or organisation. Unstructured data is needed for applications like social media, mobile apps, and analytics used by organisations to meet their goals or objectives.
Digital transformation is a catalyst for the growth of fraud. It may occur due to the fact that it transfers control from financial institutions, such as banks and credit cards companies, to e-commerce firms. This, in turn, makes it easier for fraudsters to get money from customers without the need to alter their credentials or credit card number.
A major limitation of digital transformation is that it can lead to data breaches which may result in significant legal liability for companies and financial losses for consumers. The most critical challenge for digital transformation is data security and privacy.
How to Implement Digital Transformation
Organisations must use digital transformation techniques to ensure that their services are improved, and customer satisfaction is increased. There are certain steps organisations can use to implement the digital transformation process successfully. Organisations must use digital transformation to ensure they achieve their objectives and goals.
Planning is essential for successfully implementing any project or idea. Organisations must plan a lot before they implement a particular digital transformation technique. Planning helps organisations ensure that the digital transformation process successfully meets their goals or objectives. Planning can also help organisations know about their employees and customers to meet the required goals.
The deployment of the digital transformation process is crucial as it helps organisations to test everything before they start using it permanently. Deployment of digital transformation process helps companies ensure that there are no bugs or anything else concerning the technology they are using. Software testing is vital for organisations already implementing digital transformation.
Monitoring the technology is one of the crucial steps that organisations must follow to ensure everything is done correctly. Monitoring helps companies in getting a better idea about their employees as well as about their customers. Monitoring helps organisations get a better idea about the possible solutions and the various issues that might occur during this process. Organisations must monitor data, money flow, applications, and more.
Empowerment is also an important step that organisations must follow to ensure they use their employees properly. Empowerment helps organisations give their employees the proper instructions and what they need to do to ensure that the organisation is doing well. Organisations can empower employees by making them aware of the main goals and objectives of the business. Empowerment helps employees understand more about their customers and also helps them in taking care of their customers as well.
Innovation is also an important step that organisations use to ensure they receive the best results. Innovation helps organisations make sure that they adapt to change and find new ways to meet their goals and objectives. Innovation is significant as it helps organisations better understand their customers and employees. Companies must use digital transformation to provide better customer services and products.
Measurement is crucial for the successful implementation of digital transformation process. Measurements are needed to ensure that the organisation realises its goals and objectives and how it will use some service or product to meet its objectives. Measurements help organisations better understand how effective they are in their processes. It also helps organisations to make changes that are needed to make sure that they can increase the efficiency of their business.
What Effect Did COVID-19 Have on Digital Transformation?
The emergence and extension of the COVID-19 pandemic have caused significant ramifications in digital transformation, and one of the most notable changes is that it has forcibly shifted IT staffing needs. Given its systematic nature, not only will IT functions be required to increase but so will infrastructural support. This creates a significant opportunity for those tasked with planning future growth, as they can leverage existing resources and current organisational capabilities to their advantage.
Another critical aspect of digital transformation is identifying and eliminating the sources of risk that the emergence of COVID-19 has introduced. For instance, the shortage of skilled IT professionals that are required to operate both corporate systems and general infrastructure has become a significant issue in terms of competing allocation of resources. As a result, organisations must begin prioritising their needs, which in turn helps create a more efficient workforce. It also allows them to build upon existing capabilities by building new strengths in areas they may otherwise lack.
Digital transformation is a critical process that companies implement to ensure they receive the best results. Organisations must use digital transformation techniques to ensure they retain their customers. Digital transformation techniques are needed to understand their employees and customers better to meet the organisation’s objectives. Organisations must use digital transformation to ensure more profits and good results. Organisations must use digital transformation processes to ensure they receive the best results.