Digital transformation:
What is it and why is it important?
Blog updated on 4th February 2022 by Tye Howitt
Digital transformation is the process of using digital technologies to help re-imagine how you run your business. Digital transformation leverages technology to enhance customer experience, streamline business processes, and make your business more responsive to evolving customer needs.
So, with that in mind, let’s explore some of the ways your business could benefit from digital transformation.
Benefits of digital transformation
With digital disruptors impacting every industry, success will come to those businesses that ensure their workforce is skilled in the best practices of the digital age. Practices which must be woven into the fabric of the company and strongly endorsed by those in leadership in order to have maximum impact.
Digital transformation benefits both the business and the workforce, with key benefits including:
Enhanced data collection
Most businesses are collecting huge amounts of data, but few can optimise and analyse it to drive the business forward. Digital transformation enables greater capabilities for gathering the right data and incorporating it into a performance management framework.
Digital transformation offers businesses tools and techniques with which they can identify and collect valuable data across numerous touchpoints and translate it into business insights that will improve the customer experience and empower the workforce to grow the business.
Data driven customer insights
As discussed above, data can be the key to unlocking customer insights. Using modern analytics tools to merge structured data (such as customer information) with unstructured data (social media metrics, for example), you can unlock powerful insights into your customers and their business requirements and buying behaviours. And with a better understanding of your customers and their needs, you can create a business strategy that is even more tailored towards them and inclined towards growth.
Enhanced customer experience
Digital transformation is not limited to just unlocking insights to be leveraged by your team, it also allows you to provide seamless and intuitive experiences for your customers. This is extremely important as they have high expectations for digital experiences and these expectations are going to continue to rise in the future. They are used to having endless choices, low prices, and fast delivery. Customer experience is where a business is won and lost in the digital age.
Increased agility
Digital transformation makes organisations more agile. Businesses can increase their agility with digital transformation to shorten the time taken to launch new products or services to market, and facilitate a faster, more agile cycle of innovation and change that takes the business on a pathway of continual improvement and growth.
Increased profits and productivity
Digital transformation can also drive productivity. For example, implementing automation across the organisation will enable employees to work much more efficiently and increase productivity.
Companies that undergo digital transformation also improve their profitability. Consider these impressive results:
- 80% of organisations that have completed digital transformation report increased profits
- 85% say they have increased their market share
- On average, transformative leaders expect 23% higher revenue growth than competitors
- (Source: SAP Center for Business Insights and Oxford Economics)
Digital transformation can seem like a daunting topic. This is understandable when you consider the fact that it is essentially reassessing and re-imagining how you operate your business. Change can be challenging, but the benefits of digital transformation are so compelling that they cannot be ignored without serious long-term consequences. Eventually, everyone will conform and being behind the rest of the pack will only lead to one outcome.
Next week, we will be continuing this topic, with part 2 discussing the impact Covid-19 has had on digital transformation in addition to highlighting the trends we are likely to see more of in the future.
by Tye Howitt
Blog Contributor.
