Digital Transformation – All You Need to Know

If you are wondering how to transform your business, so that it reaches a higher level and generates you more profit and help in customer retention, then you need to know about Digital Transformation. But What is Digital Transformation? Digital Transformation is defined as the integration of digital technologies in all areas of business operations. As the name suggests, it focuses on changing how companies operate and deliver value to their customers and other stakeholders. In today's world, there are many expectations from customers, and every other day new business opportunities are created.   

 Using advanced technologies in Digital Transformation for a business have a customer-driven and digitally based approach, starting from the business model to the customer experience and from processes to operation. In this blog, we will discuss What is Digital transformation, some latest trends, and most importantly how you can use it in your business to optimise operations and profit.

Table of Contents 

1) Understanding What is Digital Transformation 

2) Purpose of Digital Transformation 

3) Different Digital Transformation technologies

4) How to get started on Digital Transformation?  

5) What are the key trends in Digital Transformation to look out for? 

6) Benefits and challenges of implementing Digital Transformation 

7) Conclusion 

Understanding What is Digital Transformation 

Digital Transformationis a method that aims to change how the current traditional and non-digital business processes and services work. This is done by entirely converting them to digital technologies or developing new ones. This results in a complete change of a typical business operation that is managed and meet customer expectations by delivering value.   

On a broader perspective, all the aspects of an organisation ranging from employee skill set to organisational hierarchy, from workflows to operation of different teams, needed to be inspected and revamped by implementing Digital Transformation. This implies that organisations focussing on old, time-consuming business processes had to be stopped and start defining new practices and building the organisation based on that.  

The purpose of Digital transformation is not to create disruption or technology of any sort but rather to improve Customer Experience, people's mindsets and many more through the intelligent use of technologies and information. Factors like innovation, the flexibility of operation, and optimisation of customer experience serve the goals of Digital Transformation. 
 

Purpose of Digital Transformation 

Digital Transformation is important to improvise their operation, organisations need to evolve and continuously meet the industry's needs. Several ways, like on-demand training, switching data to Cloud services, Artificial Intelligence (AI), and many more, can help organisations improve the end-user experience. Hence, Digital Transformation is essential. However, a point to be noted is that it is not easy to change legacy systems by using Digitial Technology.     

Digital transformation has become increasingly necessary across organisations due to the rapid acceleration of society's digitisation that began in the late 20th century and continued in the first two decades of the 21st century. Many organisations have a notion that they need to adapt with time and a rapidly changing market driven by digitisation, or else they will be obsolete in the years to come.   

A typical example where a disruption in the operation of an organisation happened through the use of digital technologies is when IKEA, a leading multinational organisation, decided to implement some Digital Transformations in their organisation in 2018. For almost 80 years, this company has been running analogue businesses. This company, as we know, makes money by designing ready-to-assemble types of Furniture and home accessories.   

By transforming digitally, IKEA took care of the following things: 

a) The focus of IKEA was on e-commerce development. 

b) Turning stores into fulfilment centres, where the company worked on algorithms to manage the supply chain and analytics for better decision-making. 

c) The decision to establish a connection with clients or customers through in-store or virtual interaction to have consistent branding and improved customer experience.    

From this example, we notice how the organisation found a new way of managing business, providing better customer experiences, and delivering best-in-class products by using these advanced technologies. 

Different Digital Transformation technologies  
 

There are several technologies to implement Digital Transformations that organisations can make use of to come up with unique innovations and improvise their capabilities. Let us discuss some of the most prominent technologies that can help businesses march toward Digital Transformation. 

Mobile technology 

The most critical technology responsible for implementing Digital Transformations in an organisation is mobile technology because mobile devices can increase the frequency and speed of interactivity between customers and organisations. Further, a mobile-friendly interface is essential if an organisation needs a presence in the online domain among its customers. The interactivity between customers and organisations allows real-time data exchange, which otherwise would be impossible in other ways. The importance of mobile solutions will be rising over the next half-decade. 

Artificial Intelligence and Machine Learning 

The ability of computer systems to simulate tasks performed typically by human beings with the help of their intelligence is termed Artificial Intelligence. Machine Learning can be defined as the subset of Artificial Intelligence that extracts some results and patterns from the input data. This is done with the help of using data and algorithms to mimic the human brain's learning, thereby increasing the algorithm's accuracy. Using such technologies in the organisation can help them achieve better data insights, quickly make decisions, and forecast irrespective of human input. 

Internet of Things (IoT) 

An extensive network of connected systems responsible for collecting and sharing information without manual input constitutes the Internet of Things (IoT). An IoT platform is present, which is centralised and connected to the device's sensors. These sensors are used to extract and store data from them. By using such data, valuable information can be shared with the organisation's people. 

Big Data Analytics 

Big Data, in simple words, refers to massive data that is tedious or impossible to process using traditional methods. The range of Big Data varies from terabyte to zettabyte, and its structure can be structured and unstructured. This digital technology can sort out complex data by bringing out essential information, for instance, market trend, customer taste and preferences, and other correlations. 

Digital Twin 

A Digital Twin recreates any real-time process by collecting simulation data to forecast performance. By using 3D modeling, a virtual aspect of the real-time process or service is developed. There exist four types of Digital Twins: Component, Asset, Unit, and Process, which can be used by an organisation based on the requirement. The Digital Twin, based on the performance of the simulation, can be connected to other technologies such as Big Data, AI, and IoT to come up with innovation. 

Augmented Reality 

Physical reality is virtually augmented by combining digital elements and sensory stimuli using Augmented Reality. It uses a mobile phone combined with available data to generate graphics visually. The best way to understand Augmented Reality is by using filters on social media such as Facebook and Instagram. These filters are the social media version of Augmented Reality. 

Cloud technology 

Traditional storage devices are not compatible because they are unable to store and handle the massive amount of data in a secure and cost-effectively. That's where Cloud Technology comes into the picture. In Digital Transformation, this technology has agility, flexibility, and scalability for any organisation. This is because data can be stored in the Cloud without the need for the organisation to get into the pain of downloading files of larger size, searching IT experts, or updating programs manually. 

Robotics 

Robotics, as we know, is a branch of engineering sciences used for designing and constructing robots. The sole purpose of this field is to create intelligent machines that can help humans in numerous ways. When other technologies like AI and IoT are used along with Robotics, this leads to providing outstanding outcomes to any organisation. Additionally, it can improvise user experience and productivity, along with efficiency.  

How to get started with  Digital Transformation?

Here we have listed some steps which you can take if you want to get started with Digital Transformation. These steps are:

a) You need to understand your present state first. You need to assess your business goals, future financial plans for your business, and most importantly what you want before implementing any new technology.

b) Next, you need to plan how will this Digital Transformation align with your exisiting business tools and operations.

c) In this third step, you have to determine, what strategy and roadmap you are going to follow implementing Digital Transformation.

d) You need to make sure that your stakeholders and your employees, should be aware of the steps that you are taking, and they agree with the changes that will be made.

e) If you think your employees need to be more technologically advanced, then you need to place training facilities or hire skilled employees who will help you to achieve your goals smoothly.

f) However, advanced technologies become, you need to implement only those technologies which are suitable for your business, flexible, and easy to understand.

g) Embracing a digital culture is not enough, you have to promote a digital culture as well. You need to take care that your employees remain enthusiastic towards new and different technologies and encourage their curiosity.

h) Changes can be difficult. Therefore, adopt an easy Change Management Model and follow through the steps, making sure that your employees are not resisting to the change.

i) Initially, you need to test a lot, whether this Digital Transformation is working or not. Identify your errors in the business and come up with creative solutions to solve them.

j) Always stay on top of any new update that can come into the market. Make sure that by staying vigilant and informed you can implement some best practices in Digital Transformation.

What are the key trends in Digital Transformation to look out for? 

Let’s discuss some of the key trends in Digital Transformation to look out for: :

a) Artificial Intelligence and Machine Learning

b) Automation

c) Cybersecurity

d) Edge Computing

e) Cybersecurity

f) IoT and 5G

Benefits and challenges of implementing Digital Transformation 

A Digital Transformation implementation can be crucial for any business across industries to compete and succeed. However, to make the most significant impact, the attitude of transformation must be the motto of any company. We look at some of the benefits which are discussed below when an organisation works towards implementing Digital Transformation: 

a) The first benefit of Digital Transformation implementation is boosting innovation and increasing agility. This is because while developing digital processes, Agile organisations define responsibility and accountability for their decision, are better prepared for handling uncertainty and mitigating risk, and achieve the required outcomes. Such factors will help achieve success for the business that is sustainable.  

b) The next benefit of implementing Digital Transformation is that it promotes collaboration and communication between various organisation departments through the digital platform, which leads to innovations and produces valuable output. Factors such as accountability, productivity, and creativity can be improved when the internal communication of the business can be digitalised. Such a thing will lead to organisations having the edge over other competitors.       

c) The third benefit of implementing Digital Transformation is to increase operational efficiency and effectiveness. By integrating back-office systems and automating delivery processes, we can combine manual processes and bring down the overhead cost, which can be done with the help of technologies such as Robotic Process Automation (RPA). Such a process in Digital business will save time and bring in more revenue.  

d) The fourth benefit of Digital Transformation is to enable Digital Growth in the future. This is because, without Digital transformation, an organisation will become backdated and unable to compete with the organisation implementing Digital Transformation. An organisation should not run away from converting to Digital Transformation; this transformation sets the stage for all subsequent business growth.   

We talked about some of the benefits of implementing Digital Transformation to achieve business success. However, there also exist a few challenges of Digital Transformation that are discussed below:  

a) The first challenge is that if the top-level management of the organisation is not interested in investing in a technology that involves replacing legacy machines and systems that do not support digital form, there is a high possibility that digital transformation will not happen, and the company might become obsolete.  

b) The second challenge is the unavailability of talents and expertise because when a business is marching towards Digital Transformation, if they do not have good resources and talent will lead to a miserable journey.  

c) The third challenge of a Digital Transformation implementation is when there are constraints in budget. This is because proper planning and strategising are needed to be done by the organisation as this involves high investment. Therefore, these measures need to be taken into account while considering the business and customer needs. 

Conclusion 

We hope that after reading this blog, you have understood What is Digital Transformation.  It has become increasingly necessary across organisations due to the rapid technological advancement. The purpose of Digital Transformation is not to create disruption or technology of any sort but rather to improve customer experience, people's mindsets and many more through the intelligent use of technologies and information. 

Learn how acquire the knowledge of Digital Transformation domains and understand the latest skills required by signing up for our Digital Transformation Certification Course now!