Enterprise digital transformation is a strategic procedure that integrates all departments with technology thereby guaranteeing a better work environment and higher ROI among other benefits. Many companies are deploying this process to realize its advantages. In this blog, we will discuss enterprise digital transformation thoroughly.
What is Enterprise Digital Transformation?
Enterprise digital transformation means incorporating technology in all the areas of your business to ensure a smoother experience. It is a planned process that enables businesses to use technology to their advantage. To be sure, it increases your company’s overall efficiency and helps it grow exponentially.
This process involves the use of state-of-the-art technology like AI, machine learning, cloud-based solutions, and IoT for a better experience. These can also help businesses meet their expectations in time. Enterprise digital transformation has a positive impact on all areas including operations, customer experience, and business models.
As per Accenture’s recent survey, COVID-19 has flattened digital transformation. It has also elaborated on the rate of adoption of certain digital solutions in the report. When it comes to IT infrastructure, companies are increasingly adopting technology like DevSecOps, serverless computing, docker and Kubernetes, and even FaaS.
Moreover, blockchain, 3D printing, robotics, and open source are increasingly being adopted. Other technological advancements like AI, machine learning, IoT, cloud-based solutions and data-driven decision-making have increased manifold.
In short, enterprise digital transformation enables businesses to become more agile, responsive, and innovative, by leveraging technology to create new products and services, streamline processes, and enhance customer engagement.
Importance of Enterprise Digital Transformation in Business
If you have not enabled enterprise digital transformation, this section is meant for you. We will now elaborate on the importance of this shift, for you to begin with yours.
a. Improved customer experience
Customers are the priority of all companies because they define your success. Therefore, it is essential to work for a better customer experience. We advise that you begin by analyzing customer behavior through research and understanding their issues, if any. You must also deploy chatbots that are available 24×7 to cater to the challenges being faced by customers. Better communication will attract more customers and improve the growth of your business.
b. Better collaboration
It is important to initiate streamlined business operations through better collaboration across the various departments of your company. You can do this by establishing channels of communication and understanding the concerns and needs of all departments separately. Improved collaboration will have a positive impact on the customer experience.
c. Enhanced productivity
Once you have successfully initiated enterprise digital transformation, you will see your business grow. This is because the process will shift from traditional manual labor to an automated version of your company. It will provide you with extra time to focus on things or processes that matter more, while machines do most of your work. Such a shift will increase the overall productivity of the company.
Benefits of enterprise digital transformation
Now that we know the importance of enterprise digital transformation, we must try to identify the benefits of the shift for a better understanding. Enterprise digital transformation has the given advantages:
a. Better customer insights
Gathering data is important for all companies, no matter which industry they are from. All kinds of data, whether structured or unstructured, are essential for the overall growth and performance of your business. If you know how to use data to your advantage, it will prove great for you. With data come insights, which can help your company outshine others and move ahead of the competition.
b. Improved customer experience
It is important to begin by understanding customer behavior through data and research, and identifying their problems, if any. Companies can also use chatbots that are available 24×7 to solve the challenges being faced by customers. As a company, you will also be able to collect, store and analyze all the data that is available to you. Better communication will attract more customers and improve the growth of your business.
c. Business profitability and flexibility
When you enable enterprise digital transformation, your company’s operations change from the basic level. With better technology at your disposal, you can take advantage of features like automation. This way you do not have to spend too much time on repetitive work and can focus on more important operations of the day. It also leads to a better customer experience, thereby increasing profits through flexibility.
d. Higher agility and innovation
Most companies want to build an innovative work culture, driven by experiments. Therefore, one must instill a growth mindset in the employees and encourage doubts. A more active and user-friendly approach can also be used for managing operations. When your business is based on innovation and agility, you can easily harness growth in your favor and do exceptionally well, against your competitors.
e. Data-based decision-making
Data is crucial for enterprise digital transformation. If you are a large company, you know how much data related to customer insights and company performance you have to store. But with digital solutions, this becomes extremely easy. Many firms are employing cloud-based solutions for the management and storage of data. This can also be accessed anytime and from anywhere in the world thereby improving the decision-making process.
f. Cost Savings
It is a fact that enterprise digital transformation can reduce costs significantly. When you employ digital solutions in processes that deal with data, you can reduce overall costs by 90%. It not only saves money but time and effort as well. Moreover, it reduces reliance on manual labor and data thereby cutting costs essentially.
g. Competitive advantage
Digital transformation automates all processes and takes charge of the production process. It also monitors the product quality in each stage of production. Better technology gives you an advantage over your competitors because you can not only produce better products but also cater to the concerns and needs of customers. With better customer service, you are likely to also gain new clients.
h. A top-notch global workforce
Enterprise digital solution promises to empower your employees and transform them into a top-notch workforce. The process improves the way everyday tasks are carried out and makes them more flexible and innovative. When you can work from anywhere, you can hire talented people from across the globe and use their skills to your advantage. This is much like business process outsourcing, which employs numerous people from other countries.
i. Enhanced futureproofing
It is important to have a digital transformation plan that grows with your business and carries a vision. You must draft a plan that protects your business from the dynamic nature of the market, which includes a change in prices, trends, and other things. Make data collection your priority and ensure that you are using updated technology for enhanced future-proofing.
Conquering Challenges in Enterprise Digital Transformation
Enterprise digital transformation, just like other processes, faces multiple challenges. To ensure a successful outcome, businesses must try and overcome these. In this section, we will discuss the various challenges that enterprise digital transformation is surrounded with and how you can get rid of them.
a. Reluctance to change
A common challenge faced by companies comes from the employees, who are quite reluctant to change. Any form of transformation brings new expectations and an entirely different work environment. Most employees don’t want to shift from the traditional ways of working.
To overcome this, companies must establish channels of communication and discuss the need for change and how it will be beneficial for the company. The employees must also be trained and provided with 24×7 support to adapt to the changes.
b. Absence of a robust plan
Many companies lack a clear vision or plan of action for the future of their company and this can be a major impediment. Without a foolproof strategy, realizing the benefits of enterprise digital transformation will be next to impossible. Therefore, it is advised that companies build a robust plan that can work wonders for them.
c. Incorporation hardships
Many a time, incorporating modern digital solutions with existing systems can be difficult. This process is considered to be time-consuming and demands a lot of expertise. To solve this problem, businesses must adhere to a proper plan of action, wherein they can identify issues in advance easily.
d. Data confidentiality and security issues
e. Absence of an appropriate work culture
It is essential to foster a work culture that allows innovation through experimentation. Companies must try to avoid a hostile environment to change and take risks. Such a culture can degrade the value of your enterprise’s digital transformation significantly.
One can initiate a positive work culture through dialogue and collaboration. Regular feedback must also be encouraged along with a growth mindset and proper rewarding apparatus.
f. Confusion about ROI
Many companies are unsure about the return on investment, which defines the success of the enterprise’s digital transformation. A lower RoI can never justify the use of resources and prove the entire process to be a failure. It is essential to predict the RoI in advance and estimate the benefits that the plan might have in the long run.
How to Build a Successful Digital Transformation Roadmap for Your Enterprise?
Many companies are confused about how they can build a successful digital transformation roadmap for their business. It is essential to be particular about this phase because it will be guiding the entire transformation. Now, we will discuss the key steps in drafting a roadmap for enterprise digital transformation.
a. Measure your digital capability
Begin by taking a look at your existing technical know-how, infrastructure, and other operations. You may also try to compare your digital capability with the industrial standards. While doing so, ensure that you have identified the pain points or areas for improvement.
b. Determine the objectives
A process that has no goal, has no value either. It is important to set certain targets or objectives about what you wish to achieve through enterprise digital transformation. You may also define the key performance indicators (KPIs) and set genuine goals for yourself.
c. Get the top leadership on board
It is important to get the top leadership on board. You may begin by presenting the entire plan solely for the company’s benefit. Many people also try to speak in terms of numbers, like an increased ROI, to attract leads. It is also advised that you personalize the presentation, by catering to the desires of each board member.
d. Situate digital transformation with your business plan
You must try to incorporate your digital transformation roadmap with the business plan. This involves prioritizing certain operations over others, based on how beneficial they are. It is also considered wise to have a roadmap that aligns with the long-term objectives of the business.
e. Build an innovative and active culture
Many companies aim at developing a work culture that is driven by innovation. It is crucial to instill a growth mindset in the employees and encourage experiments. A more active and user-friendly approach can also be used to manage operations.
f. Determine crucial skills and resources
Companies must begin by analyzing the various skills and resources that they possess. Once this has been done, it becomes easier to identify the most important elements of the business. If there are any gaps in the overall functioning, you can also direct resources towards it and solve the problem.
g. Create a step-by-step plan
We always advise companies to break down the entire implementation plan into smaller parts, to make it more manageable. Each unit or phase can have a milestone, to assess growth and keep a check on the process. This can also help companies identify the shortcomings of the plan, if any, and make necessary changes.
h. Select the ideal partner
It is important to choose a partner who has a lot of expertise in the industry. Companies can go for references from other firms that have already used the services of the shortlisted partners. An analysis of the record and compatibility of the partner’s existing technical know-how.
i. Deploy a foolproof change management plan
One can begin by explaining the need for enterprise digital transformation and how the process can be beneficial for the company. Many companies also delegate tasks and involve employees in the operations so that they can understand the process in a better manner. You must also provide support to them, wherever required.
j. Constantly track and assess progress
Here you should go back to your pre-determined KPIs and begin assessing the progress of enterprise digital transformation. It is advised that you collect feedback from your employees, stakeholders, and end users for a better understanding. You can keep amending the procedure as per your needs.
3 Components for a Successful Enterprise Digital Transformation
Many companies wonder how they can make enterprise digital transformation successful. To be sure, a good transformation has 3 key components, that each company must include.
a. Adopt a product-led mindset
It is advised that you adopt a product-led mindset, that is, make your business operations more oriented towards product management. This can be done by identifying customers whose problems are yet to be solved and finding solutions to their problems through constant discovery. We also suggest being on time with your solutions to enhance customer experience.
b. Set genuine expectations
It has been proven that almost 80% of enterprise digital transformation projects are bound to fail and a major reason is setting unrealistic expectations. You must understand your business and the needs of your key stakeholders thoroughly. Once this has been done, take the help of your transformation roadmap and set practical expectations with all the data in hand.
c. Communication is key
We believe proper communication is the best way to proceed with enterprise digital transformation. Companies can establish channels of communication to ensure that everyone in the group can voice their concern, without hesitating. It is also crucial to ensure that this communication is driven by data and foolproof research.
New Trends in Enterprise Digital Transformation 2023
The market trends are quite dynamic these days, with things changing every other day. In this section, we will highlight the top trends that are guiding enterprise digital transformation in 2023.
a. Hyper automation
Companies are increasingly deploying state-of-the-art technology like AI, machine learning, IoT, and robotic process automation (RPA) to drive growth. These are also enabling them to automate everyday business operations and reduce human errors, thereby helping them grow exponentially.
b. Data-centric decision-making
Data is the most important element of any process and companies must use it to guide decision-making. Decisions have become more scientific and rational with improved analytics, AI, and machine learning. It further optimizes operations and drives the growth of the company.
c. Edge computing
Technological advancement and data-driven processes have also enabled companies to adopt edge computing. It systemizes data closer to the source and works towards data privacy and security and also increases the overall efficiency of the company. It also caters to the need for real-time data processing.
d. Digital personnel
Many firms are also moving towards digital instruments and personnel, thereby facilitating collaboration and communication through proper channels. They are also incorporating technology like virtual reality (VR) and augmented reality (AR) for better training and reskilling of all employees.
e. Cybersecurity flexibility
With digital solutions come cybersecurity issues as well. Many companies have reported data loss, data theft, and hacking among other problems in the past. Therefore, we advise that you enable advanced systems that can detect any form of digital threats and initiate real-time tracking of all processes.
In this blog, we have elaborated on the idea of enterprise digital transformation and how it can be beneficial for your company. We have also discussed the major trends that are guiding the process in 2023. We hope this helps you out in initiating enterprise digital transformation for your business.