Regardless of the size of your business, one thing is certain: digital transformation is imperative for every business, from the smallest one to the large multinational corporations.
What’s more, digital transformation is a cultural change that motivates organizations to constantly challenge themselves in integrating digital technology across all business areas, transforming the way a company operates and adds value to its customers.
But beware: this isn’t about just moving your processes to the cloud.
It’s also important to remember that organizations are going at different paces through this path of digital transformation. One of the most difficult issues in digital transformation is how to overcome the initial problems from the visualization to the execution of the process itself.
Even organizations that are well on the road to digital transformation face tough obstacles such as budgets, finding talent and cultural changes.
History of Digital Transformation
Although technology and computing have been present in our daily lives for decades, the concept of digital transformation is relatively new. It came about in the ‘90s with the popularization of the Internet.
Since then, the ability to convert traditional forms of media such as documents and photos has transformed our lives and affected many businesses. New businesses have sprung up and others, in turn, have unfortunately closed their doors. Some cases are even well known worldwide, such as Blockbuster and Kodak, which went under because of their lack of innovation.
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Today, digitization affects every part of our lives, affecting the way we work, shop, travel, educate, govern, and live. According to a publication by Think with Google, “In the last two years, 90% of all the data available worldwide has been produced. And in the next two, we will produce a volume equivalent to all the knowledge generated by humanity to this day“.
The introduction of digital technologies has triggered the creation of new business models and revenue streams. Emerging technologies such as artificial intelligence (AI), cloud archives, and the Internet of Things (IoT) accelerate transformation, while fundamental technologies such as data management and analysis are needed to analyze the huge amounts of data that result from digital transformation.
A study by Accenture shows precisely how digital transformation can offer exceptional capabilities to companies.
Digital transformation is not just about technology. We can say that it’s based on three fronts, namely:
- People – Hiring talent is just the beginning. The structure and culture of the organization are equally important in successful digital transformation projects.
- Business – The right business strategy can drive internal process digitization and the development of new business models.
- Technology – Emerging technologies such as AI and IoT, as well as key technologies such as data management and analysis.
Why digital transformation matters?
A company could start thinking about digital transformation for a variety of reasons. But by far the most likely reason is that it’s a matter of survival for many businesses.
Digital technology has always been viewed by companies as a support tool, as something to improve productivity rather than seeing it as an active driver, a fundamental aspect of business that is intrinsically linked to innovation. This view, however, has changed dramatically as the Internet, mobile devices, and connectivity have become more interlinked.
Moving on to what we call the Fourth Industrial Revolution, it is time for companies to plan technology demand in detail and raise its level of importance, making it an indispensable aspect within strategy and business plans.
Factors that encourage digital transformation
Interestingly: Acoording to this infographic compiled by MineWhat.com, 81% of consumers research online before buying, and about 60% begin by using a search engine to get more information about a product or a service they want. And there is more: according The ROBO Economy, 56% of online shoppers read reviews before make any purchase.
This goes to indicate how widespread the use of the Internet is. We can no longer treat it as a niche marketing channel. Nowadays, online channels are the simplest and most cost-effective way to capture a large, well-informed audience.
Most people today stay connected through social media. This is a highly lucrative and constantly growing market for modern businesses to penetrate and evaluate customer buying patterns so that they’re able to, above all, deliver personalized experiences to their consumers.
But it’s not only marketing that can benefit from it. Digital transformation offers a number of advantages and options, including inventory management, detailed insights, enhanced real-time customer interaction, increased productivity, more reliable financial forecasting, more assertive business decisions, and improved resource allocation.
Supporting the digital transformation
From the companies’ point of view, business leaders have already realized that by taking an active role, trying to simplify current technology and eradicate any complexities in the process, results are faster and measurable.
Technology and innovation, when combined with digital businesses, support a company’s digital transformation and results in competitive advantages. It helps companies meet the demands of the changing digital economy.
Another important point to keep in mind is regarding the Millennials, also known as Generation Y. These people are already aware of the latest technology trends and are increasingly aware of any developments. This means companies need to be digital-ready at all times.
And this is also related to how this generation sees the possibilities of work and the adherence to freelance and remote work, and the constant growth of digital nomadism.
Reasons to go digital
Now that you understand the importance of digital transformation as a whole, here are some reasons why it‘s crucial to go through this process:
1. Be found!
In an online search, if we don’t find something on Google, for instance, we assume it doesn’t exist. Customers actively look for information related to products and services before making a purchase decision. The right investment in Ads for example, plus a wide social networking strategy will leverage your business and cause it to be more easily found by your target audience.
2. Cloud and shared processes
Digital transformation enables employees to become much more focused and productive by sharing cloud data and integrated processes so that they are connected, regardless of whether they are physically together or apart.
This was made possible by different applications and other software that helped make companies much more organized and are now able to archive data more efficiently and effectively.
With the help of digital transformation, companies are finally able to eliminate paper. This process reduces costs and protects the environment. And if the business embraces the remote work strategy first and foremost, the economy goes even further: the employee doesn’t have to commute daily to the office, resulting in a car less on the road and helping to lessen pollution (not to mention other costs such as savings on food, electricity, expansion of physical spaces…).
4. Know your target audience better
Having an online presence allows you to get to know your target audience better. You can also get information in real-time on demographics, daily visitor numbers on your site, including their home country, preferences, tastes and so on. Companies can use this digital technology to set growth and innovation goals, for instance.
The time for digital transformation is now, and every business needs a solid digital strategy to make sound decisions and be successful.
Also, you must use digital transformation to broaden your competitiveness and strengthen different aspects of your business by embracing new technologies.
I know what you’re thinking: that digital transformation may just be a sophisticated way of describing modernization.
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