Digital transformation. It has become a bit of a buzzword, but with an ever accelerating digital era and a global pandemic it has stepped back into the limelight and heralded a new digital edge.
But what does digital transformation mean? Put simply by the trustworthy Wikipedia: “Digital transformation is the adoption of digital technology by a company to improve business processes, value for customers and innovation.”
Within a business, digital transformation can take many forms, from web and mobile apps to customer portals, CRMs and ERPs. It can be an off-the-shelf solution or custom built solution. It could be digital services and products for your customers, or it could be developed to automate processes, improve user experience or increase customer satisfaction, to name a few.
For some organisations, ‘digital transformation’ was something for the future, something that would cause upheaval so was put off until a more opportune time. But then 2020 arrived with a global pandemic, throwing all businesses but particularly customer facing businesses, in-person services and brick and mortar businesses into a world of new challenges and rapid pivoting.
According to multiple surveys by McKinsey & Company, Covid-19 has had a huge impact on re-prioritising digital transformation, increasing funding for digital initiatives and increasing the awareness of the strategic importance of technology in not only meeting the needs of customers but in gaining competitive advantage.
Technology’s part to play in business has evolved in the last few years, not only for those who are customer facing but those who are digitising their core internal operations.
Prior to the pandemic, digitising these processes was not always a top business priority, but business priorities have changed in the last 18 months. Now businesses are trying to digitise a new, more urgent priority list:
- Enabling remote working
- Changing customer needs
- Health and hygiene
- Reducing the reliance on on premise solutions
- Increasing migration to the Cloud
- Creating digital experiences for customers
- Improving access to services and products
- Communicating with customers in new formats
As a result of these changing needs, digital transformation strategies and funding for digital initiatives have increased dramatically. For some companies, they’ve accelerated their share of digital services or products by 7 years in an attempt to pivot and meet their business and customer needs.
For example our own client, Unislim, a health and fitness platform, leveraged new digital solutions to provide unique digital-only customer experiences, where there had been in-person services. Without this digital transformation, the business would not have been able to offer their customers the same or a similar experience. Instead, they have created a new digital service that enhances their business offering, successfully pivoting during a time of great uncertainty.
As a result of this new ‘digital edge’, digital transformation is no longer simply a way to reduce costs but instead has become a critical, strategic component. 51% of respondents believe that planned investment in digital and technology will help them differentiate from competitors. The results of the rapid implementation of digital initiatives have been seen in the competitive advantage gains, the ability to meet customer needs, and help staff navigate a new way of working.
It has given businesses an awareness of areas that are vulnerable to digital disruption and brought a mindset change which will continue to place digital transformation at the forefront of business. According to the McKinsey survey, many respondents now recognise that their companies’ business models are becoming obsolete, with 64% believing their companies need to build new digital businesses.
Now is the time to have a strategic digital partner who can help develop solutions and processes that will equip businesses to be leaders in their fields, to be where their customers are and to have the infrastructure in place to support their staff, meet the demands of their customers and future proof their business (for at least a few years).