Three reasons to get started with digital transformation
In a recent survey, 39% of global enterprises reported transformation projects that were either complete or nearing completion. The study, conducted by Vanson Bourne and New Relic, highlights the progress early adopters have made, with over 90 percent of respondents stating their projects either met or exceeded expectations.
With more organizations experiencing the positive impact of digital transformation, the question for those yet to embark on projects of their own has moved from “should we” to “when will we.” That remains true even in the face of a global pandemic and accompanying economic uncertainty.
Reduce your operational costs
Many businesses have held off on digital transformation through an understandable reluctance to incur upfront costs. They worry that major investments in new technologies will fail to generate returns fast enough to validate the expense. However, digital transformation can produce almost immediate cost savings—directly impacting an organization’s bottom line.
Migrating on-premises platforms and systems to the cloud, for instance, can all but eliminate the cost of around-the-clock IT maintenance and upkeep. With IT purchased as a service, maintenance becomes the responsibility of cloud providers, who reap efficiencies by providing similar services to multiple customers and can therefore offer them at a considerably lower price point.
Digitization can also replace manual processes that are time consuming to implement and a drain on productivity. Inefficient manual processes are estimated to cost the U.S. more than $335 billion per year. Many businesses still rely on manually-created spreadsheets to track and monitor workflows, for example. These take time to assemble and are often riddled with human error. Targeted investment in automated workflow tracing and reporting systems can significantly reduce these errors while increasing the speed of the reporting process, immediately impacting operational efficiency.
Keep up with your customers
Modern consumers traverse a vast digital landscape, engaging with social media platforms, mobile applications, websites, and other digital smart home, entertainment, and retail services on a daily basis. To attract new customers and retain existing ones, businesses must create a digital strategy that accounts for all of these different touchpoints, and for the inevitability that they will both multiply and shift over time. That is almost impossible without digital transformation – and another reason to embark on digital transformation sooner rather than later.
Digital transformation enables a customer engagement strategy that is both broad and flexible. It can free an organization from depending on any single platform or combination of platforms to reach their customers or deliver their products and services. And it can offer the agility they need to be able to pivot in face of rapidly shifting economic circumstances.
Digitization also lets brands take customer outreach one step further via targeted personalization. Customers are more likely to forge an emotional connection to a brand when services, communications, and offers are personalized according to their specific preferences and history. A 2018 Motista study found that customers who are emotionally invested in a brand present a lifetime value that’s 306% higher than those lacking that kind of close connection.
A successful digital transformation project can ensure that every interaction meets customers on their favored platform, including platforms yet to be developed, and is tailored to their individual interests and preferences, creating unique experiences that build engagement and long-term loyalty.
Lay the foundation for future growth
Relying on outdated technologies doesn’t just hinder businesses from dynamically responding to evolving customer demand. It denies them the opportunity to adapt as markets change and grasp new growth opportunities as they appear.
Many of digital transformation’s most powerful technological solutions—cloud computing, automation, artificial intelligence—are necessary foundations for that future development and growth. Delaying their adoption comes at a real cost to an organization’s long term chances of survival.
Cloud platforms, for instance, can scale up or down as changes in demand and need dictate. Automation allows businesses to roll out new offerings, open additional locations, and enter new markets quickly and efficiently. By definition, AI platforms continually learn and evolve, enabling new applications and use cases.
It’s important to realize that none of the technologies associated with digital transformation exist in a vacuum. They operate within an overall environment that allows them to be tightly integrated and pass data from one platform to another. That’s why businesses need to create digital transformation strategies with comprehensive technology roadmaps that account for every solution on their radar. Like the transformation process itself, that’s a significant undertaking but also one that is highly achievable with investment, planning, and guidance.
Digital transformation has matured to the point that companies can no longer ignore or postpone it. Getting started now can position organizations to more easily incorporate the next wave of cutting-edge digital solutions, navigate economic uncertainties, and grasp opportunities whenever they arise.
Take action by enrolling a cross-functional group from your company in Stanford Online’s Digital Transformation program. This self-paced, online certificate program will teach leaders in your company how to implement digital transformation, from building or reforming company culture to implementing technologies like AI and crowdsourcing, creating increased efficiency and greater agility across your organization. Find out more.