If you have read some articles already about digital transformation, you will have noticed that they all refer to its increasing necessity in a world that is becoming more and more digital. However, we found that the concept remains unclear in most articles, especially regarding what it really means in practical terms. Feel reassured, it is not only a buzzword to say that you should move to a cloud-based solution or that you should incorporate e-signature to your processes. Digital transformation is about creating a digital and interdependent organism which can reveal more data, automate processes and ease the work for your employees. But enough with the abstract description, let’s see some real-life examples.
In this article, we will see what digital transformation really means, the reasons why you should consider digital transformation and the key trends for 2020.
What is Digital Transformation (with real-life examples)
Digital transformation looks different from one company to another as each business has its own unique processes. However, it all comes to 2 changes:
1. A change in technology
2. A change in mindset
Obviously, there is no digital transformation without a change in technology. The integration of new digital tools into the areas of your business is the first step towards digital transformation.
The second change is less obvious yet much more important. The integration of new technologies will result in fundamental changes to how your business operates and that means that it will challenge you and your team. Some companies have worked for years with the same process in place and although it is not competitive anymore, everyone feels comfortable working with it. But, when the time comes to change, not everyone can easily adapt to it. This is particularly true in the finance industry. As a word of advice, digital transformation is an ongoing process where you should have an open mindset to new challenges, failure and time-consuming experimentation.
In brief, digital transformation is the change of your current and outdated process by digital technologies that can integrate with each other in order to grasp more data from your workflows, be more efficient and provide a better service to your customers.
In 2 words? Remain competitive!
Some reasons why digital transformation is vital for your business:
There are many answers to this question but we believe that John T. Marcante, CIO of Vanguard, has summed it up well, which will make you think about how digital transformation is so important nowadays:
“Just look at the S&P 500. In 1958, U.S. corporations remained on that index for an average of 61 years, according to the American Enterprise Foundation. By 2011, it was 18 years. Today, companies are being replaced on the S&P approximately every two weeks. Technology has driven this shift, and companies that want to succeed must understand how to merge technology with strategy.”
Hence, according to IDC, worldwide spending on technologies and services that enable digital transformation will reach $1.97 trillion by 2022 and grow steadily.
Some “practical examples”
1. Increase on-demand services
Generally, there has been is an exponential increase in expectations from customers in recent years which has become highly challenging for businesses. It’s mainly due to the increased number of options available and the fact that new companies take a customer-centric approach when it comes to the delivery of services.
2. More productive employees
Workforce engagement has become of the most important topics of interest for management today. Companies are looking for newer ways to enhance their employees’ productivity, which has become partly achievable, thanks to the latest digital technology which plays a key role in enabling workers to become more proficient in their jobs.
Digital transformation provides employers with an opportunity to streamline their core functions and give better visibility of their impact. More importantly, it enables organisations to automate difficult and painful tasks that not only are time-consuming but more importantly that are undermining for your team members.
3. Efficient decision making
Data, data and… data. Already in 2018 advanced analytics, along with enterprises planning, was the number one digital investment which increased, by more than 75%. This included a particular emphasis on data visualisation tools and machine learning.
Keeping data analysis at the heart of the digital transformation strategy will greatly boost the chances of taking advantage of your digital transformation journey. Using accurate analytical tools can provide vital business insights that can be used to make timely and informed business decisions. These analytical tools should be fully embedded into business operations, providing real-time results that greatly help decision-makers.
Digital Transformation Key trends in 2020
According to Steve Hall, Partner and President of global technology research and advisory firm ISG:
“In many areas, CIOs and organisations have prepped their organisations for change but haven’t made the full leap to transforming their culture to fully embrace the change”
So here are 5 key digital transformation trends that business and IT leaders should be aware of in 2020:
1. Fast adoption of integrated cross-functional teams
2. An analytic leapfrog for those who invested earlier in AI and analytics tools
3. Expanding public cloud adoption
4. Improvement in compliance and fraud detection
5. New digital transformation success metrics.
New digital technologies such as AI, cloud-based solutions, upcoming DLT solutions and new workflow structures are increasing and their adoption with it. Although costly first, digital transformation enables businesses to reduce time-consuming processes, increase employees’ productivity and more importantly give smart information to improve and scale your business.
The problem is, if it was only a cost related matter, most big companies would have already mastered this concept and leverage all the different digital technologies but that’s not the case. The reason lies in the fact that digital transformation is a mindset, a bold statement that your current structure is not good enough and the will to improve even it means experimenting with processes you never heard about so far.