# Essential Strategies for Successful Digital Transformation in Business
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Chapter 1: The Imperative of Digital Transformation
In recent months, businesses have come to understand that digitalization is no longer merely an option but a necessity. The Covid-19 pandemic underscored the importance of technology in adapting and reshaping business models. A study by Tech Pro Research from three years ago indicated that 70% of companies had either developed or were in the process of creating a digital transformation strategy. The pandemic has reinforced this trend, with companies impacted economically choosing to maintain their investments in digital transformation.
“While 52 percent of companies plan to cut or defer investments because of COVID-19, just 9 percent will make those cuts in digital transformation.”
Transforming a company's processes and models often encounters resistance. Therefore, anticipating and strategizing effectively is essential for success. The digital transformation journey can be divided into two key areas: the enhancement of internal operations and the improvement of customer interactions and experiences.
Both areas necessitate thorough examination by the teams responsible for implementing these changes. However, focusing on the transformation of internal processes and operations is crucial. This aspect not only lays the groundwork for enhancing customer experiences but also significantly boosts productivity and efficiency, leading to cost savings and added value.
Nonetheless, altering operational processes can be one of the most challenging aspects of business transformation. Human habits are deeply ingrained, making it difficult to change established ways of working. If you cannot persuade your colleagues to embrace these changes, how will you successfully onboard your clients?
Here are ten actionable strategies that can be applied across any business to facilitate a successful and seamless digital transformation, all grounded in professional experience.
“The biggest part of our digital transformation is changing the way we think.”
— Simeon Preston
1. Address Concerns Openly
People often resist change, particularly when it involves digitalization. Many may question the need to alter long-standing business practices. Common apprehensions include:
- Fear of diminished overall value.
- Concerns about job relevance.
- Belief that resources are insufficient for implementation.
These fears are frequently based on misconceptions. Engaging in discussions to address these concerns is vital, as it helps clarify that digitalization focuses on enhancing human experiences. Acknowledging these apprehensions can refine your internal strategy for promoting digital initiatives.
2. Communicate Effectively
Without effective communication, efforts toward transformation can fall flat. The benefits of digital transformation can only be fully realized when the entire organization is informed and engaged.
A Gartner study reveals that organizations accelerate their digital transformation efforts when there is a shared understanding among leaders and the workforce about the digital journey ahead. Regular updates through emails, newsletters, and meetings can foster a culture of transparency and collaboration.
3. Leverage Data Strategically
Digitalization often goes hand-in-hand with digitization, leading to the accumulation of valuable data. Despite its potential, many businesses underutilize this resource. According to SAP, less than 1% of existing data in businesses is analyzed for actionable insights.
“If we have data, let’s look at data. If all we have are opinions, let’s go with mine.”
— Jim Barksdale
Data serves as a critical tool for tracking progress and supporting decision-making. It’s essential to identify which key performance indicators (KPIs) will be most relevant for your business, as these may evolve over time.
4. Focus on the Right Tools
Given limited resources, prioritization is crucial. The initial phase of transforming processes should aim to enhance employee workflows, thereby increasing productivity while showcasing the benefits of digitalization.
“Seventy-six percent of executives agree that organizations need to dramatically reengineer the experiences that bring technology and people together in a more human-centric manner.”
— Accenture
Long-term planning when selecting or developing new technologies can lead to cost savings and greater efficiency in the future.
6. Highlight Added Value
The core objective of any business is to create value. Digital transformation typically incurs significant costs, making it important to emphasize the value generated from these investments.
“Greater digital maturity is associated with better financial performance. The higher-maturity companies in this year’s sample were about three times more likely than lower-maturity companies to report annual net revenue growth and net profit margins significantly above their industry average.”
— Deloitte
The return on investment may manifest through increased revenue or enhanced efficiency in daily tasks. Identifying and highlighting the right metrics is essential to showcase this added value.
7. Secure Management Support
Leadership engagement is vital in any digital transformation effort. Executives possess the authority to make strategic decisions and inspire the organization towards new objectives.
“Visionary CEOs, individually, are the engines of massive change that is unprecedented in the history of information technology — possibly unprecedented in the history of commerce.”
— McKinsey
Without the endorsement of top management, achieving widespread adoption among employees and securing necessary resources can be extremely challenging.
8. Implement Training Programs
Different employee generations within a company have varying levels of technological familiarity. Organizing training sessions in conjunction with new technology releases ensures that everyone understands how the technology functions and its intended purpose.
9. Solicit Feedback Regularly
Collecting feedback is crucial for refining new features and fostering a sense of involvement among employees. A study from Industry Week found that 71% of leaders view the workforce as essential for supporting their digital transformation strategy.
Gathering feedback not only enhances the development process but also provides invaluable insights from beta users that can serve as a cost-effective means of quality assurance.
10. Practice Patience
Transforming processes and operations demands patience. Changing human behavior takes time, and digitalization should be viewed as a long-term commitment.
A 2018 study by Cisco found that 39% of executives expect to see the benefits of digital transformation within three to five years. While facing obstacles during this transition can be frustrating, maintaining patience and addressing challenges thoughtfully will facilitate a smoother transformation.
“Don’t be fooled by some of the digital transformation buzz out there; digital transformation is a business discipline or company philosophy, not a project.”
— Katherine Kostereva
Digital transformation is essential for businesses seeking to stay competitive. When executed correctly, this investment can lead to significant growth, although it carries inherent risks. Viewing digitalization as a core company value is crucial, especially as technology continues to evolve, making transformation an ongoing journey rather than a finite project.
Relevant Videos
Incorporating insights from leading experts can further enhance your understanding of digital transformation.
#### Digital Transformation & Enterprise: Across the Rubicon
This video delves into how enterprises can effectively navigate their digital transformation journeys, emphasizing the importance of strategic alignment and cultural adaptation.
#### TECH TALK | The Keys to Success in Making the Digital Transformation
This tech talk outlines critical success factors for implementing digital transformation, showcasing real-world examples and actionable strategies.