If your business has paper-based processes or repetitive manual tasks, you may want to implement digital transformation. You can use technology to innovate and automate your key processes, saving you both time and money.
In this digital transformation guide, we’ll provide you with an overview, strategy, benefits and challenges.
What is digital transformation?
Salesforce defines digital transformation as:
“The process of using digital technologies to create new – or modify existing – business processes, culture, and customer experiences to meet changing business and market requirements”.
Businesses may use digital transformation to gain a competitive advantage, become more efficient, or launch a new product or service. We’ll dive more into the benefits later in this digital transformation guide.
A guide to digital transformation - how to identify opportunities
What problem are you trying to solve?
We ask ourselves the same question when we purchase a new product, change a process, or implement a system.
To identify areas for digital transformation, you can ask your colleagues “what frustrates you at work each day?” and “what stops you from being as productive as you can be?”
You’ll then need to fully understand the problem, by speaking to other key stakeholders, understanding their pain points, and exploring how you can use digital technology to improve experience.
For example, you can use digital technology to automate processes, such as capturing customer details in a digital format, if you’ve found that they’re taking up too much time which can better be spent elsewhere.
Digital technology can reshape your business, so you’ll need to look at how you can overcome the challenges in your business, whether it’s combining repetitive daily tasks, data collection, entry and processing, or application development.
What are four areas of digital transformation?
Assess your business and create your digital transformation strategy
Digital transformation doesn’t happen overnight. You’ll need a strategy that will go through the planning and execution process so that you can meet your end goal.
Once you understand the problems you’re trying to solve and the areas for digital transformation, you can evaluate each component under that area.
If you’re looking at process transformation, you’ll evaluate each of your business processes to identify gaps. For example, your assessment may include evaluating the below processes:
1. Core business processes
These are primary processes that drive your organisation, such as product development, customer acquisition, and CMS.
2. Operational processes
Operational processes support business functions and day-to-day operations, such as quality control and resource planning.
3. Customer-facing processes
Customer-facing processes directly interact with the customer, such as sales, support, onboarding, and customer experience.
4. IT processes
IT processes involve using digital transformation to automate or integrate, such as software development, system maintenance and upgrades, and database management.
5. Cross-functional processes
Cross-functional processes span multiple departments, such as project management, communication, and information sharing.
Once you’ve identified your areas of digital transformation, you can outline your approach with your digital transformation strategy.
1. Clearly define your objectives and goals
Examples could include improving efficiency, reducing costs, or enhancing customer experience.
2. Assess your processes
Identify areas for improvement by gathering metrics and feedback from key stakeholders.
3. Prioritise your processes!
Select the processes which have the potential for significant improvement
4. Embrace technology
Don’t be afraid to implement new software systems or adopting emerging technologies to help you meet your goals.
5. Monitor progress
Make sure you monitor and report progress on the impact of your digital transformation.
5 benefits of digital transformation
Digital transformation is complex, but it can be critical to the success of your business. Here are some benefits of using digital technology to transform your business.
1. Make your business more efficient
By automating your processes, integrating systems, or migrating to the cloud, you’ll save time and reduce overhead costs.
2. Data-driven insights
You can use digital transformation to collect and analyse data which you may not have used before. You’ll be able to collect, store, analyse, and translate data that can help with decision-making.
3. Encourage collaboration
By providing employees with the right tools, you’ll create a more seamless way to collaborate, whilst allowing upskilling and a shift to a digital culture.
4. Improved productivity
By streamlining workflows and reducing tasks, you can improve productivity and help employees become more efficient.
5. Increased agility
By using digital transformation, you can make your business more agile, allowing for faster innovation and risk management.
5 challenges of digital transformation
1. Siloed decision-making
If your business largely operates in isolation, with poor collaboration and communication, then you may find that it has a negative impact on decision-making, and therefore you may lack ideas or innovation to transform your business.
2. Legacy systems
Stepping out of your comfort zone is hard. You may find it easier to stick with your legacy system, even if there are more agile and robust tools out there.
3. Change-averse culture
Having a change management culture is crucial to business success, especially with digital transformation. You’ll need a change management strategy before adopting digital transformation.
4. Technical resource and digital skills gap
You may not have the internal resource or skills to adopt digital initiatives. If you don’t have an internal team already, and you’re not interested in hiring one, you can speak to a software company (like us) to transform your business.
5. Insufficient budget
Dependant on your project, the budget and scope of the project may not be a cost-effective solution. By identifying your long-term goals and ROI, you should be able to understand how flexible your budget can be.