What is digital transformation? Digital transformation seems to take on a different shape depending on what the organization. So, defining an all-inclusive description is not easy. In the broadest terms, digital transformation is the synthesis of digital technology into every area of business. Consequently, this is a strategy that pushes toward significant changes in how the business functions and gives value to customers.
It may mean a total cultural change inside the company. The people leading the organization need to begin questioning the current state of affairs continually. A natural progression would include employees becoming enthusiastic about experimenting with disruptive tech and not fearing failure.
Several common themes run through existing digital transformation frameworks. Repeating factors such as using technology to enhance customer experience, operational agility, culture, and leadership shifts, and workforce enablement are pointed out as driving forces. Each of these segments has added up to a massive wave spreading across the global business world. The better tech you have, the better your chances are to stay ahead of competitors.
Digital transformation also involves a change in management style, new thinking, the backing of innovation and new business models, combining digitization of assets, and increased use of technology. The results continue to show improved relationships with employees, customers, suppliers, vendors, and stakeholders.
The Wikipedia definition, while imprecise, regards how the effects of digital transformation stretch beyond businesses to community as a whole. It reads, “Digital transformation is the changes associated with the application of digital technology in all aspects of human society.” Each one of us is seeing how tech is supplanting many traditional norms that previously we part of everyday life. The perception of most is that modern life is becoming more comfortable, more convenient, and generally easier. These benefits lead to further the cultural desire for more tech, not less.
At the heart of it, digital transformation points to executive leadership and sociological change. Your company might have all the individual elements such as appreciating the customer’s view, big data, and smart tech, but if top management is not leading by example, it fails. On the other hand, upon leadership learning what digital means to your company, that creates motivation. Thus giving more employees the urge to drive that philosophy to other colleagues. The syndication of the core message is the essential ingredient for continued success.
Why does digital transformation matter?
A business may embrace digital transformation for various purposes. However, by far, the most popular reason is that they have to. It’s a new survival issue. Businesses never transform by choice. Change is often expensive and risky. Businesses opt for transformation when the economic pressure makes it seem logical.
Take a gander at the S&P 500. In the 1950s, U.S. corporations remained on that index for an average of 60 years. By 2011, they lasted 18 years. Today, companies get replaced on the S&P approximately every two weeks. Technology has accelerated this transformation, and companies that want to stay in business must learn how to leverage technology and merge that into their strategy.
U.S. enterprise leaders have received the message. Accordingly, they are prioritizing spending. IDC calculates that global spending on technologies and services that empower digital transformation will expand to $1.97 trillion in 2022, as stated by the (IDC) Digital Transformation Spending Guide. The IDC forecast overview is that digital transformation spending is on pace to grow continually achieving a five-year compound growth percentage of 17 percent between 2017 and 2022. A transfer of capital funding digital transformation is an important demonstration that business management is acknowledging digital transformation one of their best long-term investments.
Each organization is advancing the digital transformation mission in various ways. Organizations move at different paces, but now speed has become a business imperative for each competitor. IT leaders especially, tackle the pressures to demonstrate how digital initiatives are getting translated to competitive advantage.
This modern and rapidly evolving environment means executives must match the pace of change. Falling behind could mean disaster for the organization. This risk is the new existential issue discussed in today’s digitally-focused arena. So, management is supporting the acceleration of out-of-the-box thinking while still managing the daily operational issues. The CIO of 2020 and beyond must be supreme at multitasking and an influential leader on the digital front.
Customers expectations are already high and growing. While consumers enjoy savings and convenience from online e-comm, there is still a craving for something more profound than pure consumerism. People desire a connection with businesses before making a purchase. This means every company needs to understand how to influence the customer journey by adding technology. Once a business learns and defines their customer’s expectation, they are better positioned to adopt technology to drive positive change. Improving customer experience and managing expectations have become crucial goals. Thus, a fundamental element of digital transformation.
Our story highlights what and why digital transformation is recognized by analysts to be the topic of the decade. To gain insight into how significant this trend is, you might go back to the early 1900s. If you asked customer then what they needed, they might have said a faster, more comfortable horse. The company that ignored the standard fulfillment response, Ford Motors, went on to lead the industrial revolution. We are now in the digital revolution, where anyone is capable of seizing the opportunity to create a brand new business model. Becoming a pioneer to transform your business or industry might be optimistic, but at least admit that it is time to manage your digital transformation road map.