‘Digital Transformation’ is one of those terms business leaders believe is necessary for their business, but don’t truly understand what it entails.
We will give a basic overview of what digital transformation is, and then offer realistic ways you can begin digitally transforming your business.
What is digital transformation?
Wikipedia defines it as:
“The adoption of technology to transform services or businesses, through replacing non-digital or manual processes with digital processes or replacing older digital technology with newer digital technology.”
Pretty vague, right?
The term entails unique applications of technology for each business. Making it difficult to pinpoint a definition that applies to all businesses.
It could be as simple as starting to use an advanced password manager for employees instead of using the basic password management services offered by native operating systems (Mac, Windows, Linux) or internet browsers (Google Chrome, Firefox, etc…).
This transformation can also be a complex process involving a complete overhaul of location tracking systems for employees, products, and company assets.
What works for your business is not going to work for everyone.
There are many digital technologies out there working well for the majority of businesses with specific industries such as manufacturing, mining, or retail — more on these later!
Digital can mean many things to many people
You ask three different people what digital transformation entails, and you will probably get three different answers.
One may say it’s going ‘paperless’, the second may say it’s starting to use big data and data analytics, and another may say it’s using social media platforms.
The truth is, it is actually many things to many people.
There is an opportunity to digitally transform almost every role within an organization.
8 Basic Steps of Digital Transformation
Understanding company culture
Company culture drastically influences a company’s ability to digitally transform their business. The more open an organization is to change, the quicker and more efficiently it can implement new digital technologies.
Creating a company culture where it is encouraged to challenge the status quo, experiment with new ways of doing things, and being okay with failure, is what determines if a company is successful with digital transformation or a failure.
Without incentivizing experimentation and encouraging failure (to a reasonable degree) there is no chance of implementing new technologies to improve your business quicker than your competitors.
Modern technologies are developing rapidly and the companies of the future are the ones capable of creating new innovative cultures at a speed on par with technological development.
Do you want to be left behind by your competition? No.
It’s more important than ever before to create a cultural environment within businesses not scared of trying new technologies or expressing interest in new ways of doing things by leveraging new technologies.
Defining the problem
Digital transformation should always begin with a problem statement defining a specific issue faced by the stakeholders in an organization. There needs to be an agreed-upon problem statement for every digital transformation process.
The problem statement should define a specific problem faced by the business that may be solved, or made more bearable, by implementing digital technologies. It could be to improve customer experience, improve worker safety, increase worker productivity, or reduce operating costs.
Once a problem statement is clearly defined, it can be addressed by members of an organization through the lens of digital transformation.
Committing resources to digital transformation
This may seem obvious, but many businesses simply don’t commit to digital transformation. By committing resources to digital transformation, there is a commitment and obligation to begin the process in a formal manner.
Businesses often believe the way they are currently doing things is the best way, even though it’s clearly not upon further investigation.
Even the best of us fall prey to our own biases!
If there is no one actively focused on digital transformation within the business, decision-makers will often miss great opportunities for it, because they are being pulled in too many directions and have too many things on their mind.
Having a dedicated person with dedicated resources for digital transformation is an essential step for making sure it is actively done.
Don’t be afraid resources will be wasted learning how new technologies can help your business.
When digitally transforming parts of a business are successful the reward is often much greater than the possible negative consequences. Make the commitment. Free up resources dedicated to digital transformation. You won’t regret it!
Leading by example
If you are in a position of leadership within an organization it’s essential you lead by example. If you have the authority to experiment with new technologies yourself then do it. Ask yourself these questions:
- What problems are you having in your daily routine?
- Did you read or see anything recently that you wanted to investigate further?
- What are your competitors doing better than you?
- Are there long-standing business practices you know the company needs to walk away from?
Never underestimate your responsibility or influence within an organization when it comes to digital transformation.
Sometimes the only thing holding companies back from digitally transforming aspects of their business is the lack of initiative and responsibility taken by their leaders.
Having productive conversations about digital transformation
Leaders need to be aware of how they are framing conversations happening around digital transformation because, as we stated earlier, it means many different things to many different people.
It’s important to take some time to discuss what digital transformation means within the specific context of the business. This process will produce different definitions for each business and align everyone’s understanding of what it means in relation to their daily activities.
It’s essential leaders do not frame the ‘transformational’ part of digital transformation in a way that threatens job security, or produces hostility from workers and executives involved in conversations about digital transformation.
If digital transformation is a term producing resistance, or irritation within an organization, it may be better to re-frame it in a more relatable way.
Some examples could be adopting new technologies so the business does not get left behind, or being more innovative than the competition, or taking advantage of new opportunities made possible by new technologies.
Get the point? Framing is everything!
Getting employees involved
Ask your team if they know of any technologies out there that would make their lives easier.
Employees are the people most affected by digital transformation. They will likely be receiving the most benefits while also being the most knowledgeable about what is needed and how it can be implemented.
Taking a purely top-down approach to digital transformation is not recommended.
Taking a more collaborative approach between executives and employees is recommended and will produce the best digital transformation outcomes.
Understanding the customer experience
Understanding how and what your customers experience when interacting with your company will determine the digital transformation opportunities needed to improve their experiences.
For example, are your customers having a hard time finding your business online? Are they having difficulties purchasing your products online? Are they annoyed having to wait too long to get your products or services? Are there technologies they use on a daily basis not integrated with your company such as a mobile phone or wearable device?
Taking a holistic approach to understanding how new technologies can improve your customer experience is essential for the digital transformation process.
Without understanding your customer, you will not understand exactly how you can begin offering more value to your customers. Digital transformation can even be putting technologies in place to better understand your customer.
Studying new technologies
Once there is a clear understanding of a business’s problem statement there needs to be an investigation of what new technologies are out there offering solutions. There are a plethora of new automation tools using both software and hardware technologies together.
Examples include software automation tools, human-machine collaboration technologies, internet of things (IoT) devices, cybersecurity solutions, cloud computing services, mobile applications, robotics, etc.
Developing a nuanced opinion of what technologies may help with digitally transforming aspects of your business will help maximize the benefits, reduce failure rates, and unlock new forms of value.
Digital transformation is offering companies capable of implementing new technologies within their company a leg up over their competition. The importance of healthy and successful digital transformations within an organization will only increase as the development of new technologies increases.
If your business is not focused on this transformation, you will be left behind. For many businesses, it’s become digital transformation or death.
Do you have a better understanding of what digital transformation is and how to begin taking the next steps towards digitally transforming your business? Let us help, we offer real-time location tracking solutions that will jump-start your journey.
If we missed anything, you have questions, or you had success with digital transformation based on what you learned in this article, feel free to reach out to us or visit our website to learn about our RTLS solutions!
We will be happy to hear from you!