What is Digital Transformation?

What is Digital Transformation?

Digital transformation is the process of implementing workflows and technologies that leverage data into your business operations.

From using AI for marketing purposes to replacing paper invoices with billing apps, companies all over the world are changing their business processes, customer relations techniques, and marketing tactics.

While it may be obvious that digital transformation is unavoidable, some businesses are slow to implement it. This approach puts them behind the competition. To gain a competitive advantage in the 21st century, it’s imperative to embrace the numerous digital opportunities and integrate them with existing work processes.

At the end of 2020, it was projected that regardless of the disruptions brought upon the COVID-19 pandemic, global spending on digital transformation would grow by more than 10%. Given how the pandemic forced organizations to embrace technology to continue or adjust operations coupled with remote working, the growth rate is likely significantly higher.

3 Types of Digital Transformation

Most likely, your company is already working on some aspects of digital transformation. Some require a global change of work processes while others need short-term adjustments. Here are several common types of digital transformation to consider:

• Process transformation — digital transformation brings about automation. From programmatic advertising to automatic billing, the entire work process can change. Moving main company software to the cloud can stimulate remote operation thus improving the company’s efficiency and bottom line.
• Customer experience — from implementing 24/7 chatbots for customer support to maximizing advertising and service channels, digital transformation is the key to improving customer experience. Meanwhile, customers expect the digital approach from their favorite brands and may avoid companies that fail to make interactions convenient.
• Business model — digital transformation helped many companies reinvent their offering. For example, some grocery stores moved their operation online and adopted a delivery model. Meanwhile, many companies are integrating the online operation model to extend their outreach overseas.

Digital transformation helps businesses find additional niches while providing high-quality customer service and attracting new segments of target audiences.

Main Benefits of Digital Transformation   

While digital transformation may mean getting out of the “comfort zone”, it comes with a variety of benefits.

• Efficient decision making — digital transformation simplifies the data collection process, thus improving analytics and helping with decision-making. With the right tools, it’s possible to collect and analyze data and real-time, optimizing the decision-making process tremendously.
• Employee satisfaction — since employee retention is a serious concern for many businesses, improving satisfaction is on the agenda. Implementing digital tools can reduce the amount of repetitive and manual work, helping employees focus on their main responsibilities.
• High marketing ROI — digital marketing is an integral part of any company’s success. By implementing digital transformation, you are taking full advantage of digital marketing opportunities, thus increasing its ROI.
• Higher profits — companies that choose digital transformation report higher profitability. Staying on top of all the digital tools helps them streamline the work process and achieve numerous goals.
• Competitive advantage — even though 87% of business owners say that digital transformation is a priority, only about 40% are arranging full support of digital initiatives.
• Flexibility and scalability — digital transformation simplifies scalability and allows companies to be more flexible with decision-making, innovations, and goal setting.

Digital transformation is changing the way many companies operate. By avoiding it for too long, you could be staying behind the competition and eventually experiencing significant downtime.

The Takeaway

By 2023, spending on digital transformation is expected to grow to more than 53% of all information and communication tech investments. Avoiding it is no longer an option.

While digital transformation comes with many challenges, most of them have to do with integrating different systems into one consolidated effort. By taking it one step at a time, it’s possible to implement digital aspects of the modern work process within months.

It’s imperative to understand that digital transformation isn’t solely a technology initiative, it’s an integral part of a company’s evolution.