Digital transformation is using technology to create new or modify existing business processes, culture, and customer experiences to meet changing business and market requirements.
It can be summarized as the reimagining of the business for the digital age.
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Why should companies consider digital transformation?
Personally, I have seen the power of digital transformation and it really sets you up for working in an agile, collaborative way which pushes a company towards a journey of growth.
It also allows a value-add to every customer interaction and can give a better customer experience.
In most cases, companies push towards digital transformation as it helps to stand out against their competitors and ultimately move ahead.
The big value add for me is the fact that data collected via a digital transformation has meant that companies can make more informed decisions, and at the same time they can understand more about their customers.
One brand that comes to mind is Tesco, and their use of the Clubcard — this allowed them to recommend offers to customers based on what they generally buy and it has enticed customers to come back from competitors and shop in their stores.
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Examples of digital transformation
In covid times a large amount of doctor appointments became virtual appointments — this is an example of using technology to meet changing requirements. This meant that customers and doctors were safer, at the same time it has helped where people are struggling to get appointments. This for many has been a game changer.
When taking a flight there has been a move towards online check in, which has enhanced the experience. This has saved time on the long airport check-in lines and as a bonus lets people book in their seats before they even reach the airport.
The biggest example of digital transformation that has come to mind though is the monster brand ‘Netflix’.
This started as a mail order service and it completely disrupted the bricks-and-mortar video rental business.
Digital innovation made wide scale streaming video possible. Digitisation also gave insights into viewing habits and preferences. The data was also used to inform decisions on everything, from design of user experiences, to development processes to actually watching the films.
To become successful Netflix digitally transformed the following areas:
Process Transformation
Business Model Transformation
Domain Transformation
Cultural Transformation.
In this case for Netflix digital transformation was a massive win!
How to go about your transformation?
Digital transformation can look different in each company, though the thought process on achieving this can be similar.
Firstly start with the problem statement and see whether there is a clear opportunity for development.
Then ask for feedback from different members, this will allow for diverse thoughts and it may also mean opportunities in areas not previously thought about.
The last step should be to plan out the transformation, and track the success via measurable metrics. This is essential as if the transformation is not giving the reward you would expect, then having data allows you to correct ahead of time.
Tips from the industry
Based on my research some key findings:
Understand what is possible with digital transformation before you start to plan.
Design customer experiences from the outside in and see what problem you are trying to solve.
Recognise employees’ fear of being replaced — this is not what digital transformation is.
Review the capacity and acknowledgement for change within your organisation.
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Closing
Digital transformation when aligned to business goals is really powerful and it has made many businesses more successful, also adding that customers have reaped the rewards.
Most of the digital products we use have certainly been achieved via digital transformations of their brands. We as the customer have certainly reaped the rewards.
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