Re-imagining your business in the digital age means equipping your organization with the tools necessary to keep up with competitors and to meet changing market requirements. This type of transformation transcends traditional roles like sales, marketing, and customer service, and focuses on how your organization thinks about, and engages with, customers.
There are generally 4 main areas for digital transformation
Business Process Transformation
Most companies engage in a business process transformation when they require a major change or update. Undergoing such a transformation will modernize an organization’s processes, integrate new technology, save money, and better incorporate core systems.
In the past 2 years for examples many companies were forced to figure out how to support remote employees. At the very least this meant employing video conferencing but proactive IT leaders also used it to migrate to a Unified Communications as a Service or in layman’s terms hosted VoIP. There are many other processes however that can also benefit from technology. Areas such as Cybersecurity and Data Backup can also be changed by cloud technologies such as DRaaS (Disaster recovery as a service), CBaaS (Cloud Backup as a service), Cloud file sharing, Cloud storage and so on.
Business Model Transformation
In today’s business world, there are numerous examples of this kind of innovation, from Netflix’s reinvention of video distribution to Apple’s reinvention of music delivery (I-Tunes), to Uber’s reinvention of the taxi industry. These well-known names are not the only companies to incorporate such big changes into their business model. Insurance companies like Allstate are using data and analytics to un-bundle insurance contracts and charge customers by-the-mile—a wholesale change to the auto insurance business model.
By reinventing and adding to their current model for success, corporations can achieve a renovation that leads to significant new opportunities for growth. An example might be customer service, traditionally many companies provide a toll free # and have agents answering customers calls. Analytics however have proven that a large percentage of customers prefer text messages, emails and chat for dealing with service issues. Imagine a text or chat que where customers engage your company online. Rather than sit on hold getting frustrated customers pull your app on their iPhone and take care of transactional service issues or paying bills online.
An area that doesn’t get as much attention, but has proven itself to have enormous potential, is Ecosystem or domain transformation. New technologies have the ability to redefine products and services, blur industry boundaries, and create opportunities for non-traditional competitors. This wholesale transformation offers incredible opportunities for businesses to create new value.
An excellent example of how domain transformation works is Amazon. Amazon used its existing asset infrastructure and expanded into a new market domain with the launch of Amazon Web Services (AWS). AWS is currently the largest cloud infrastructure service provider in the world. This is a sector previously dominated by high-profile companies like Microsoft and IBM. What made Amazon’s entry into this domain possible was a combination of the strong digital capabilities it had built in storage, computing databases to support its core retail business coupled with an installed base of thousands of relationships with young, growing companies that increasingly needed computing services to grow. AWS is not a mere extension for Amazon, it’s a completely different business in a fundamentally different market space. The AWS business now represents nearly 60% % of Amazon’s annual profit.
Successful digital transformation demands more than just updating technology or redesigning products. Companies have to align its digital transformation efforts with its internal values and behaviors as well. If you don’t successfully change culture at the same time you adopt digital technologies you will find slow adoption rates which can lead to loss of competitiveness and productivity. Sometimes its hard to teach an old dog new tricks so culture has to change or your efforts will fail. However if you make a comprehensive effort to shift culture at the same time by having leaders clearly define the vision your going for with the transformation it can greatly increase and advance your transformation. Communication is key to a successful digital transformation.
Through the use of modern technology, business are constantly evolving to better their efficiency, agility and competitiveness in the marketplace.