Why a Digital Transformation Strategy is Important For Your Business
5 min read
One of the most important things to understand about running a business is that you must never assume you've "done enough" to reach your peak potential. There are always opportunities that can be capitalized on to become more productive. There are always changes to enable high performance and better-quality work results from the staff. The minute you assume you've reached the peak is the minute you've lost a game that you never truly understood in the first place - and that's typically the point where you find yourself left behind by your savvier competitors.
That, in essence, is why digital transformation is so important - it helps to enable all of these things, all at the exact same time. Many executives begin their transformation process by first developing a strategy for which specific business processes should be digitized, at which point they can develop an organic plan of action regarding how to best make that happen. Getting to this point isn't necessarily difficult, but it does require you to keep a few important things in mind.
What is Digital Transformation?
At its core, digital transformation is the process of taking a manual business process - as important as it may be - and translating it into a digital one with the use of software and the services needed to create it.
In other words, think about a critical (but manual) business process that takes an employee 15 minutes to complete, 4 times a day. If you could digitize it and automate it wherever possible, suddenly that employee has 1 more hour in a day when they can focus on more important matters. Things that actually generate revenue. Now, multiply that by the sheer volume of potential processes to be automated - and by the number of employees you have - and you begin to get a sense of just what a benefit this can be to smaller organizations in particular.
Examples of Digital Transformation
All told, a successful digital transformation is less about those single, major moves and is more about a series of smaller, more strategic ones. Regardless of how simple the example may be, it still allows you to take a meaningful step to improve your operations - which in and of itself is why the effort is always worth it.
Just a few examples of the ways that businesses have embraced digital transformation include but are not limited to ones like:
- Enabling their employees to collect better and more accurate data in the field for a services company. This lets organizational leaders better track work orders and improve things like the invoicing of clients.
- Taking spreadsheets that are being used to store data and turning them into a database-driven web application. Not only does this enable multiple users to draw from that data at once, but it's also a scalable solution - all while enabling the better enforcement of rules pertaining to those unique business processes as well.
- Capturing all touch points of the client journey - from interactions with clients to the documents that are being shared to billing and beyond. All of this is done to improve the client experience as much as possible.
- Maintaining supply chain, inventory, vendor management and other elements of a manufacturing process in the digital realm. This helps to all but guarantee that products and services can be delivered on-time and with the high quality that customers have come to expect.
- Standardizing manual paper processes so that they're not just repeatable, but to also make certain that they conform to business rules. This, in particular, is usually accomplished by creating a web application that automatically enforces those rules.
- Digitally transforming the human resources department. Many important functions of HR can be digitized including information tracking as it pertains to candidates, the hiring process, the onboarding process and more. All of this is done to make sure that all employees of a company are aware of business goals, keeping everyone on the same page and moving in the same direction no matter what.
How to Create a Digital Transformation Strategy and Solution
But at the same time, one must acknowledge that no two businesses are created in quite the same way - meaning that there is no "one size fits all" approach to creating a digital transformation strategy. You can't necessarily look to what others are doing for a roadmap. To truly unlock the benefits, you need to look inward, not outward.
This means that you need to begin by knowing which business processes you want to transform and, more importantly, why it's crucial that you do so. Analyze those processes that have historically cost the most money, that are the least efficient and that are the ones most prone to errors. Once you have a prioritized list of business processes, a digital transformation services company will be able to work with you to come up with the solution you need when you need it the most.
That digital transformation services company will also work with you to follow steps like the following:
- You'll identify the goals for the transformation project. In other words, you'll come up with an answer to the question "what will you be able to do at the end of the project that you couldn't do at the beginning?"
- You'll identify all the data and the business rules around them. You can't digitize something that you don't fully understand, which means that the steps of the process and all related data needs to be mapped very carefully. Just the process of documenting your systems goes a long way towards identifying inefficiencies.
- You'll come up with an architecture that will manage the processes and data as it flows through your organization. This helps make sure that the people who need access to that data to do their jobs actually have it when they need it.
- Screen mockups of a web application will be created that would support the architecture that you've designed. All of the stakeholders should be involved in the review of these screens to ensure that they accurately manage the process. This helps create the best user experience, which helps with employee buy-in.
- Development will be fitted to a project schedule and a calendar with milestones, at which point work can begin in earnest.
- Stakeholders will be included in weekly meetings, giving everyone an opportunity to review ongoing work. Remember: engage early, engage often. That is the key to long-term success.
- The application will be rolled out to a limited number of stakeholders to get real-world feedback. This allows problems to be fixed before the app goes live for the entire workforce.
- Once all testing has been completed and key stakeholders are happy with the results, a go-live date will be selected. At that point, the digital transformation application can be pushed into production.
- After the system is in production, feedback can continue to be solicited from stakeholders to further improve and refine it. There are always opportunities for improvement, and this is certainly not an exception.
Benefits of Digital Transformation
The benefits of a digital transformation strategy are plentiful, including ones like:
- You improve business efficiency in operations by eliminating time-consuming, error-prone manual tasks.
- You get more timely and accurate data because processes are executed instantly and with a high level of consistency.
- You improve communication because data silos are broken down, allowing information to flow freely across your enterprise in a predefined, orderly fashion.
- Data can be accessed from anywhere, at any time, in any location, allowing employees to be just as productive in the field as they can be in the office. As we have learned from the COVID-19 pandemic, remote access to data is critically important.
- You get better engagement with clients because it's easier to include them in important parts of the process through data sharing.
- You have better control of suppliers and vendors because you have more visibility than ever into how your business actually runs.
- You get improved consistency in business processes because human error is virtually eliminated from the equation.
- You generate better employee morale because people finally have access to the tools they need to work "smarter, not harder," so to speak.
- All of these efficiencies lead to cost savings almost immediately, which can't help but give way to higher profit margins as well.
In the end, a digital transformation strategy is only the first step that any business should take to improve both its operations and performance. Establishing a business partner that can help implement that digital transformation is as critical as the process itself. If your organization isn’t well versed in the transformation process and building software systems, then selecting an experienced IT company as a partner is critical to your success in this endeavor. Remember, your most successful competitors have already started or even completed their digital transformation. Most businesses must do this for many elements of their business in order to not just grow, but to also remain competitive in what will become an increasingly crowded marketplace over the next decade and beyond.
To learn more about improving your business efficiency, please download the eBook titled "How to Automate Business Process in 7 Smart Steps."