A Comprehensive Guide to Enterprise Digital Transformation
A Comprehensive Guide to Enterprise Digital Transformation
In an interview given in 2015, John Chambers, then Executive Chairman of CISCO systems, said, “At least 40% of all businesses will die in the next 10 years if they don’t figure out how to change their entire company to accommodate new technologies.”
Today, in 2021, we can see that his prediction has more or less come true. Businesses are working hard to survive and thrive. And not every business can crack the code and unlock the key to success. Fortunately, concepts like enterprise digital transformation that wasn’t very acceptable in 2015 are gaining traction today.
And in the business world, where the end goal is to make more sales and create more profit, investing in digital transformation is indeed a wise move to achieve business goals. This article will give you an overview of enterprise digital transformation, its benefits, challenges, priorities, and key drivers. So, let’s begin.
What is Enterprise Digital Transformation
Enterprise digital transformation is the process of implementing digital solutions in your enterprise in order to transform every area of your organization’s functions. The underlying goal is to improve the enterprise’s operations. And to achieve this, transformation strategies are implemented, focusing on the enterprise’s internal processes, customer services, and employees.
Essentially, an enterprise stepping on the digital transformation journey focuses on bringing technology, people, and processes together to fundamentally transform its way of operation. A cultural shift combined with the intervention of advanced technologies lays down the foundation for the enterprise’s transformation strategies. A digital transformation framework suited for an enterprise’s requirements can act as the handbook that will walk the organization through the transformation.
What are the Benefits of Enterprise Digital Transformation
Before moving ahead on the transformation journey, gaining an understanding of the benefits of enterprise digital transformation can be very helpful. It will act as a source of inspiration and can also help to clear any concerns that may arise regarding the effectiveness of digital transformation. So let’s take a look at seven benefits:
- Better Business Opportunities: With the digital culture in place, your business may adopt new models that would help you increase your reach and take upon opportunities that weren’t possible before. It will help improve your visibility and increase your operational efficiency, thus helping you scale more heights.
- Improved Customer Experience: Providing better customer experience with the aid of technologies like data analytics and AI are at the forefront of digital transformation. So, improved customer experience will help to attract and retain potential customers.
- Empowerment of Employees: A digital culture gives employees much empowerment in the way they work. Modern workplace software allows employees to work more efficiently and conveniently. BYOD (Bring your own device) gives them the freedom to work without many formalities and hassles. All of this contributes significantly to employee satisfaction.
- Enhanced Productivity: In most enterprises, a major hindrance to productivity is the array of repetitive manual tasks that eat away a lot of time and effort. Digital methods can help to automate such operations by creating modern workflows. This will reduce errors, cost and improve the quality, thereby enhancing productivity.
- Increased Business Revenue: When you integrate technologies like Cloud in your enterprise, it can bring down the infrastructure cost along with support and maintenance expenditure. As a result, your business revenue will witness growth.
- Effective Risk Management: Digitization encourages data-driven decision making. By using dashboards and predictive analysis, enterprises can create better strategies and decisions. This helps in effective risk management and eliminate losses to a large extent.
Better Delegation and Communication: Digital transformation will help to eliminate silos and support company-wide collaboration and communication. For modern enterprises, it is crucial to cultivate such an environment for receiving the best output from everyone.
What are the Challenges of Enterprise Digital Transformation
According to a Forbes article, in 2018- of the $1.3 trillion that was expected to be invested in enterprise digital transformation strategies, $900 billion would go to waste. That is, a massive 70% of these initiatives would end up not meeting the goals!
Upon investigating the roadblocks to digital transformation efforts, it was found that the topmost challenge was cultural issues. Most enterprises went through three main problems- a reluctance to change, lack of a customer-centric approach, and strong departmental silos. This resulted in an environment where there was no consistency or collaboration. So, even after upgrading to the latest technologies, success remained unattainable.
Other challenges that enterprises face include a lack of clear digital strategy, wrong choice of technology, complicated organizational structure resulting in inflexible workflows, and a lack of enterprise-wide transparency and communication.
For an enterprise digital transformation to succeed, the organization must work with an adaptable and agile mindset. Everyone should understand the benefits of digitization and be willing to welcome the new approach with open arms.
Digital Transformation Focus Areas in the Value Chain
What should an enterprise focus on when embarking on its digital transformation journey? It is one of the first questions that need to be answered before the digitization journey begins. The focus may vary from one enterprise to another, depending on their type, size, and goals. However, we will look at some common focus areas here.
- The digitization efforts should be planned with a focus to minimize enterprise risks. The shift to digital should help the organization to thrive.
- Security concerns are an inevitable result of a move to digital. Their cybersecurity should be among the top priority.
- Respond to the changes in the market and reflect them in your enterprise. Sticking on to old ways will not take you far in the fast-paced digital world.
- Focus on customer experience, by all means. It shouldn’t be treated with secondary priority as it is key to the success of the digital transformation.
- Technology is a friend but choose wisely. Focus on the technology that your enterprise needs, not the ones that are popular or trending. If your enterprise has a lot of manual operations, choose automation. If you are struggling with data management, utilize big data and analytics.
Important Ways Enterprises Can Use Digital Transformation to Enhance Productivity
Employees look forward to every opportunity they get to empower themselves and improve their productivity. It is the dream of every employee to provide more value to their enterprise and become very successful in their work. And digital transformation can significantly contribute to this. Wondering how?
- By providing the right tools to employees
Often, what limits employees from unleashing their full potential is that they do not have the right means to carry out their work. When they are given the right tools and processes, a massive change can be observed in their work, both in terms of quality and speed. When enterprises embrace the digital tools, consider enterprise app development, and invest where needed to enhance employee growth, productivity can be improved.
- By improving project management methods
Project management plays a key role in the smooth functioning of an enterprise. The role becomes even more important when the enterprise is undergoing a digital transformation. However, project management can be simplified using the appropriate tools. Traditional tools require manual actions, are cumbersome, and are not real-time. Better tools enable project managers to organize projects more efficiently and track team members and their tasks live. This helps to save time, effort and enhances productivity.
- By introducing automation
In the current business scenario, it is becoming difficult for enterprises to grow without implementing automation in their operations. For enterprises to remain competitive and improve their operational efficiency, automation is a key requirement. Automation can be introduced in project management, HR, document management, and many other important aspects of an enterprise to enhance its working.
- By promoting remote work
After Covid-19 turned the world upside down, every enterprise introduced new policies to carry out functioning in the best way possible, under the trying circumstances. As a result, remote work became a norm. However, operating an enterprise remotely while ensuring maximum productivity is not an easy feat. Of the enterprises that succeeded in carrying this out, most of them could do it because they had a solid digital foundation.
Looking at how things are moving today, every enterprise would need to give a remote working option to its employees in the future. And by implementing digital transformation, this can be achieved easily and efficiently.
Enterprise Digital Transformation Drivers
Enterprise digital transformation becomes effective and successful when one is aware of what all drives the change.
One of the key drivers, as we have already seen, is culture. Every enterprise will have some deep-rooted cultural notions, and completely disregarding those would not be wise- it might even lead to more resistance. So, enterprises should find ways to implement transformation strategies while adapting to the culture and processes that are in place.
Another key driver is the security and privacy aspects. Ensuring that digitization does not compromise security is very important to maintain the trust of your employees as well as customers.
And then comes the digital transformation technologies that drive the shift. These technologies may vary from one enterprise to another. Augmented intelligence, digital twin, cloud, internet of things, big data and analytics, and enterprise blockchain are some of the trending technologies currently.
For enterprises, digital transformation is a necessity they have to effectuate in order to adapt to the changes in the environment, stay competitive, and deliver value in the long term. It could be a path filled with challenges, as we have already seen above. However, an efficient digital transformation consulting service will be able to help you achieve the digitization goals for your enterprise. Empower your employees with the power of digital and witness your business level up.