“By using technology, we are changing the world,” says Bill Gates, referring to the strategy for the digital transformation of human civilization, economic relations, and the current lifestyle.
In fact, every company that creates an effective digital organization has a digital transformation plan that helps them along the way.
ow would you proceed to develop such a strategy? This is what we will aim to investigate together, and with some of the key points we’ll cover in this article, we may be able to make more educated judgments as we begin our digital transformation journey.
What is digital transformation?
The adoption of digital technology to transform services or enterprises, as described by Wikipedia, is the replacement of non-digital or manual processes with digital ones, or the replacement of old digital technology with newer digital technology. Rather than simply augmenting and sustaining existing ways, digital solutions, as well as efficiency through automation, may enable new sorts of invention and creativity.
The ultimate goal of digital transformation is digital maturity. This aim will be impossible to achieve without a significant shift in thinking, skills, and business processes. Digital transformation not only enhances current methods and technologies, but it also fosters innovation – in people’s thoughts, cultures, habits, roles, and, finally, processes.
The digital transformation of the company occurs as a result of the introduction of wholly new technologies that result in revolutionary shifts across industries, putting other market players at risk. Uber, Facebook, and Netflix are all great examples of companies that have transformed their industries and caused their competitors to reassess their business plans.
How leaders adapt to digital transformations
Traditional operational methods that have worked for decades are no longer effective. Only those companies who completely restructure their digital operations from the ground up will be successful.
The goal of digital transformation isn’t to ride out the storm and hope it goes away. It’s about embracing — and speeding up — change. Understanding the links between technology and people is a good place to start. To drive innovation, leaders and IT teams must work together. But, most significantly, digital change must be managed and understood by everyone in the business, at all levels. Too often, current leadership approaches are still anchored in old linear and hierarchical organizational structures, which stifle innovation and digital change.
Digital technology is changing everything
When businesses discuss digital transformation, they do not always mean the same thing. Some people envision business as usual, with some processes being digital. Others anticipate more fundamental transformation as digital technology brings up new possibilities.
According to Professor Christopher Tucci of Imperial College Business, who specializes in digital strategy and innovation, the two principles are linked. The first stage is analogous to automation, with solely physical tasks being replaced by digital alternatives. “It is beneficial, but it does not match the efficiency that anyone else could have. You’ll need something more sooner or later.”
The second stage involves looking at new products or services made possible by digital technologies. “Create something that takes advantage of your digital infrastructure and is unique or hard to replicate.” This will have a significant impact on the company’s operations. “Managing such a transformation is also an element of the digital transformation process.”
Business managers must be well aware of the processes that take place during the process of digital transformation in order to run the digital transformation of organizations smoothly. They will almost certainly need some form of training to understand digital technologies and data science. Of course, this does not mean that they will become programmers, but that they will be able to communicate more effectively with service providers inside and outside the company, and that they will become better negotiators.
Digital Transformation Management
The type of technology used in digital transformation is sometimes just a detail, whether it’s the cloud, big data, or artificial intelligence. The changing nature of work, what this means for people’s responsibilities, the types of individuals you have on teams, and how the teams will be organized is a big problem for organization leaders.
We highlight once again that if any digital transformation is to be effective, company executives must build new competencies.
First and foremost, leaders must be familiar with modern technologies. They must also have organizational skills, such as the ability to form and manage teams in the context of these new technologies. This is in addition to the fact that the leaders will be confronted with new ethical issues. This means they’ll need the skills to address these ethical issues, as well as the knowledge to think about them and make judgments that reflect the organization’s ethical dimensions.
To summarize, understanding the technology involved, the legal constraints for their implementation, the regulatory environment, and the human factor is required to properly manage digital transformation.
Digital transformation, according to Deloitte, is more about strategy than it is about technology. Companies should focus on developing a solid and well-thought-out plan to:
- Redefining efficiency and changing the nature of work: Expand and simplify operations, and eliminate manual procedures by utilizing sophisticated technology and work approaches.
- Better data management allows for real-time insights and a thorough understanding of the business environment.
- Higher employee efficiency: IT solutions may replace a variety of jobs without resulting in job losses; instead, people are transferred to new and diverse activities.
- Customers get what they want, when and where they want it, resulting in a more seamless customer experience and better engagement.
- Improved workflow, streamlined information management, and automation of manual processes open the door to more opportunities, higher earnings, and more value.
7 essential elements to building an effective digital transformation strategy
By 2022, according to IDC, organizations will spend $1.97 trillion on digital transformation solutions worldwide. Meanwhile, just 15% of firms in the early phases of transition have a defined plan.
The lack of an efficient digital transformation plan is the most significant roadblock to establishing a successful digital business. The term “strategic” refers to a link between business and information technology that aids in the integration of technologies into a company’s operations.
We’ll go through the important elements of a successful digital transformation plan in this article.
The reform is likely to fail if it does not address culture. People, in reality, are at the heart of every change, and no change can be achieved without the correct mentality. Leaders must start with the HR department to prepare them for change in order to achieve a successful digital transformation of the organization. The most dangerous error a company’s management can make is to ignore the human side. In the long term, it may jeopardize the initiative’s success and limit the influence of new technology.
1. People and culture are the cornerstones
Agility, adaptation, and the emergence of new possibilities are hallmarks of the twenty-first century. Employee skills must be reshaped, and new competencies and capabilities must be acquired. Employees are influenced by digital transformation as well as the technical route, as it is unusual to find an employee whose work is unaffected by new technology. To bridge developing skills gaps, businesses must cultivate people and establish a culture of continual learning.
2. continuous learning
The technology that enables a business transformation plan is a key component of it, and it’s something an organization should consider carefully. The best digital transformation technologies, according to IDG’s 2019 Digital Business Survey, are 5G, artificial intelligence, and augmented and virtual reality.
3. clear business objectives
Leaders must be clear about why they are becoming digital. These objectives should be consistent with the company’s culture, budget, policies, mission, and other critical characteristics.
A critical step is to link digital change to purpose. Leaders must discuss their plans with their staff across the business to ensure that everyone is on the same page and that the strategy is supported by everyone.
4. Customer experience is at the heart of the process
The client is at the center of any digital change. Obtaining as many clients as possible is a goal of any organization, but it is critical to emphasize a customer acquisition strategy focused on quality rather than a number. Companies must recognize that in today’s volatile marketplaces, situations and demands change at the speed of light, necessitating a flexible tuning of the client experience. New technologies assist businesses to achieve this by providing insight into customer expectations and demands through thorough data collecting and analysis.
5. Appropriate risk management
Security and privacy are two of the most pressing issues today. At the same time, digital business transformation is impossible without the capacity to make rapid decisions in tough situations and implement swift changes. As a result, data protection should always be one of the top priorities, and the strategy should include a complete risk management plan.
6. Promote a culture of cooperation
Many new ideas are the product of effective communication inside the firm, which is why leaders must foster a collaborative culture and construct open organizational structures. Integrated, cross-functional teams, as opposed to isolated personnel, improve teamwork and enable the quick and flexible adoption of changes throughout the business.
7. The path to a successful digital project
A well-thought-out and well-executed plan are required to reap the full benefits of digital transformation. Because this is a game-changer for many firms, it is critical to consider it thoroughly and determine how best to capitalize on it.