What is Digital Transformation?
The term “digital transformation” refers to the process of adopting digital technologies. A digital transformation strategy can help organizations achieve several objectives, including:
- Improve business processes and productivity across the organization
- Deliver better user experience and employee engagement
- Manage business risks
- Control and optimize costs
A digital transformation strategy can greatly vary from one business to another, encompassing a wide range of tools and processes. Each organization carries out a unique digital transformation journey, discovering the best way to adopt digital technologies and practices into its core processes and product offering.
In this article, you will learn:
- Why Should You Embark on a Digital Transformation Journey?
- Where Should You Start on Your Digital Transformation Journey?
- What Should a Digital Transformation Strategy Include?
Why Should You Embark on a Digital Transformation Journey?
In today’s digital economy, digital transformation is essential to keep up with the accelerated development and diversification of consumer needs. Both consumers and employees benefit from adapting the business to the digital era. Digital transformation lets you react much more quickly and more effectively to customer requirements, gaining a competitive advantage.
In the past, IT systems and software were considered a cost center. Today businesses understand that the technology needed for digital transformation is an innovative center that can directly contribute to business growth and revenues. Cloud-native technologies like Infrastructure as a Service (IaaS), Platform as a Service (PaaS), containers and serverless are tools that help companies better serve their customers.
Digital transformation is becoming a staple for businesses everywhere. According to Seagate, 66% of CEOs are focusing on digital strategies. Gartner reports that 56% of CEOs say that digital transformation is driving revenue growth.
Yet, there is a gap between digital transformation initiatives and customer expectations—in a Qualtrics survey, 60% of companies reported they have a good mobile experience, while only 22% of consumers said they are satisfied with their shopping experience on mobile.
Where Should You Start on Your Digital Transformation Journey?
The following 5-step process will help you get started with a digital transformation initiative.
Evaluate the need—identify how urgently your business needs business transformation, what is the business value for specific applications or business processes, and the investment needed to digitize them.
Create a multi-year plan—digital transformation can take time. Create a phased plan, starting with processes or applications that are easy to evolve, and are less risky. Determine your long-term budget for business transformation. The plan should include interim steps and migration strategies, to ensure that current applications continue to function while you are developing and transitioning to new applications.
Build a business plan—digital transformation is costly, but can also have major economic returns. There are two ways to “pay back” an investment in digital systems—cost savings compared to current systems, and increase in revenue. Build a business plan that combines these two elements to show how digital transformation will demonstrate a return on investment over time. Track progress against your business plan, and adapt programs to ensure they meet ROI goals.
Mitigate risk—digital transformation programs face various risks, including failed migrations, crashes, downtime, compliance violations, and cybersecurity incidents. These risks can delay and even cause the failure of a digital transformation initiative. It is important to plan for the major risks that face your project, plan how to mitigate them, and put monitoring in place so teams can recognize and respond to them.
Determine your focus—ensure your digital transformation initiative focuses on the areas that will generate the biggest impact for your business. This can include improvements in resilience, improved efficiency, contributing to a better customer experience, and enabling more agile development practices.
What Should a Digital Transformation Strategy Include?
Here are the primary components of a successful digital transformation strategy:
- Goals—the goals of a digital transformation program should reflect the current and future needs of your business, the competitive landscape, customer requirements, and existing technologies and skills.
- People—a digital strategy depends on the skills of your entire team. It doesn’t start with technology, and cannot be separated from the efforts of developers, designers, marketers, strategists, content creators, etc. All of these need to understand the value of digital transformation and be trained in the relevant digital technologies.
- Process—define how business processes operate today, where they could benefit from digitization, and how to integrate and improve existing work using modern technologies.
- Platform—the technology platform you choose for your digital transformation initiative should be strongly connected to your goals. Don’t adopt technology for its own sake—ensure that each component has a measurable impact on business goals. Platform components can include cloud systems, software as a service (SaaS), content management systems, data analytics systems, artificial intelligence (AI), and more.
- Products—identify how digital transformation will impact the products and services your organization delivers to customers. Will the products themselves change? Or will digital transformation improve delivery and usage of existing products? A balanced strategy involves optimization and improvement of existing offerings, as well as new digital offerings strongly tied to the company’s core competencies.
- Channels—determine which channels consumers will use to interact with your company and products. Which channel is best suited as a strategic delivery channel? This includes in-person shopping experiences with digital enhancements, email or messaging systems, social media, websites, and connected devices.
- Experience—observe how consumers interact with your company, especially those from the digital-first generation, and identify gaps in the existing customer experience. a digital transformation strategy must include a clear vision of the user experience. Ensure branding and messaging is consistent, attractive, and compatible with a digital experience.
- Customers—who will benefit from your digital transformation program? An effective digital transformation benefits not only end users (external customers) but also employees, suppliers and partners (internal customers). Digital transformation has the potential to make all stakeholders, both inside and outside the organization, happier and more productive.
Digital Transformation Journey with CloudBolt
CloudBolt is here to help you no matter where you are on your digital transformation journey. We believe the long-ingrained ways of doing hybrid and multi-cloud management are over, and that a new cloud order is taking shape.
Our orchestration and automation services help with managing your hybrid, multi-cloud environments, while empowering your developers with self-service IT. By turning your enterprise IT into the cloud provider, unleash a responsive, agile alternative to runaway IT that gives your DevOps what they want. With our cloud cost management and security optimization services, you can automate extremely complicated and time-consuming aspects of your cloud management so you can focus on more strategic initiatives. And with our integration platform, you can eliminate cumbersome custom coding to make your IT teams and tools work together more easily.