Digital transformation invites organizations to go beyond routine use of the web, email, smartphone apps and the in-place portfolio of IT systems. Currently, even while actively using these information technologies, many organizations still:
- Rely heavily on various paper-based, manual processes.
- Function with basic or no integration among IT systems.
- Struggle with employee and partner collaboration.
- Lack electronic connectivity with most of their trading partners.
- Operate with marginal or poor data quality.
- Work with haphazard data management practices.
- Defer modernizing their IT systems repeatedly.
Obviously, many organizations have been successful despite these shortcomings. However, the increasing pressure of more demanding customer requirements and more capable competitors mean these shortcomings have escalated into serious impediments. Here’s a summary of how digital transformation can help.
Digital transformation goals
To respond to the issues, many organizations seek to:
- Make smarter, data-driven decisions faster.
- Leverage their assets and capabilities more efficiently for growth.
- Deliver an enhanced customer experience profitably.
- Stem market share and margin erosion.
- Exploit new information technologies including the cloud, open source software packages, Software-as-a-Service (SaaS) and the Industrial Internet of Things (IIoT).
Digital transformation opportunities
Digital transformation offers a path to:
- Eradicate the remaining paper-based, manual business processes to enable a comprehensive view of the organization’s data.
- Integrate IT systems to enable a cross-functional view of the organization’s activities.
- Support seamless employee and partner collaboration for process improvements and sharing of knowledge, trends, and intelligence.
- Implement electronic connectivity with larger trading partners to improve supply chain effectiveness.
- Boost data quality to enable predictive data analytics.
- Enhance data management practices to improve the value of the organization’s data.
- Modernize aging IT systems, perhaps with Software-as-a-Service (SaaS), to achieve more comprehensive digital support of the organization’s business processes.
Digital transformation benefits
Digital transformation offers the following benefits:
- Reduced operating costs: Optimizing business processes with digital technology will reduce costs per customer transaction.
- Improved customer-centric strategy: Digital technologies will create capabilities that help organizations acquire, retain, and sell to customers while simultaneously reducing marketing spend.
- Superior data analytics: Digital technologies will combine data from all customer interactions, supporting operational data and formerly paper-based data sources into a useful, actionable view of the organization.
- Enhanced customer-centric focus: Digital technologies will enhance the customer experience. By shifting focus and paying more attention to what customers want, service experience is improved consistently across all touchpoints and channels.
- New products and services: As digital technologies enable a customer-centric focus, organizations will adapt products and services to their customers and their competitive landscape better.
- Universal customer experience: Operating with integrated digital technologies, offers customers a uniform experience, regardless of when, where, or how they choose to interact with the organization.
- Increased agility and innovation: Digital technologies that supplant limited legacy IT systems, transform organizations to become nimbler and quicker to respond to customer demands, market trends and technology advances.
- Value data as an important asset like intellectual property or facilities and develop processes and a governance structure to manage data quality.
- Leverage network-based business intelligence, optimization, and analytics tools to convert data into actionable intelligence.
- Access newer technologies including:
- Artificial intelligence
- Augmented Reality
- Cloud Computing
- Machine Learning
In what ways do you think digital transformation can produce business benefits for your organization? Let us know in the comments below.