Why Are Businesses Experiencing a Digital Transformation?
by Jonathan Tarud, Koombea
As the acceleration of the current digital business transformation pushes the boundaries of many traditional industries, companies are trying to adapt to retain their competitive advantage. The reality is that many will have a hard time trying to figure out what digital technology they need to stay relevant. Even worse, many will fail to adapt their internal processes.
Forward-thinking companies need to successfully implement digital transformation strategies. First, they need to have a clear corporate digital strategy. Failing to do these will most likely result in a loss of competitiveness, but more importantly, it might make brands irrelevant to consumers because of a digital divide.
For companies to stay afloat, a new form of thinking about technology, customers, and business is required. In this post, we address the key aspects to ensure your company undergoes a successful digital business transformation.
What Is a Digital Transformation Strategy?
Digital transformation refers to the general process that requires companies to digitize their activities. Many companies are currently undergoing this because of an accelerated pace of adoption of innovative and disruptive technologies. It refers to the way companies are responding to the growing digitalization of how business is done. Although this process had already been around for a while, it was vastly accelerated by the pandemic.
As a result, an important digital divide is starting to emerge between the companies that were prepared beforehand and those that weren’t, or from another perspective, between those that are successfully adapting and those that are having a hard time.
A digital business transformation is not something that naturally occurs.
Companies need to understand where they stand, not only in terms of their competitors and their industry but also in relation to their customers. After all, being customer-centric is one of the most important aspects that any type of company can embrace right now.
By having a clear understanding of their customers and how a new technology can impact them, companies can better align their digital transformation strategies to stay relevant. A strong digital transformation strategy can facilitate a business transformation for the digital revolution. On the contrary, a weak digital transformation strategy can be detrimental.
Why Are Businesses Experiencing a Digital Transformation?
The digital revolution is here, and with them, the need for digital strategies is growing. Businesses are experiencing a digital transformation due to various reasons. Although the following reasons don’t fully explain why a specific company might need to undergo a digital business transformation, they do help sketch out a general idea of the process. Business leaders should understand these elements to adapt to the new digital economy.
These are some of the main reasons why businesses are experiencing a digital transformation:
Enhanced Customer Journeys
The notion of a customer journey has become more important as companies shift from a product and service-driven mentality to a customer-oriented and digital culture one. Although products and services are not going to disappear anytime soon, they are now being understood through the lens of customers and digitalization. By building superb frictionless experiences, companies can redefine their processes, optimizing their business along the way.
Innovative and Disruptive Technologies
New technology solutions are at the heart of digital business transformations. The world has seen an increase in innovations in the past decade like no other period in human history. This has had a profound impact on how companies operate, and most importantly, on how customers interact with the products and services they need. This has resulted in companies needing to embrace the right technologies to stay afloat.
New Business Models
As businesses shift their mentalities and new technologies show up, new possibilities emerge. The idea of having a clear, sustainable, and well-thought business model is now more relevant than ever. Companies from all over the world can now compete with one another, reaching out to customers, no matter their location. Implementing new business models and adapting internal processes for existing companies requires a digital transformation strategy.
Need to Adapt to Changing Environments
External factors have never been as important as right now. In our interconnected world, being able to adapt and respond to changing environments is a must. Companies need to become resilient, that is, they need to be able to embrace change without losing their core purpose. This is something that digitally prepared companies can do better than their unprepared competitors. Having a digital culture mindset is a must. These changes can also be brought about from within, such as due to employees adopting a raft of different software tools to streamline their daily duties, and the concerns over security and access control this creates. So, understanding SCIM attribute types to unify and standardize how a broad internal app ecosystem is managed is another critical step.
Why Digital Transformation Is Important
Depending on the industry, implementing digital strategies successfully can be a matter of life or death. Industries that are highly driven by technological innovations require that companies adapt at a very fast pace, but choosing the right digital offerings can be a burden.
To do it correctly, it is necessary for companies to have a digital transformation management mentality. Top-level executives need to understand the importance of this process, or else fail to become relevant to their customers.
A digital transformation will not guarantee success on its own. However, it can make a difference in terms of leveling the playing field. Not being digitally prepared means that there is a growing digital divide to fill, making it harder to compete in an already competitive market.
This article is an excerpt from a longer piece. To read the full feature, please follow this link.
Jonathan Tarud, Koombea