To navigate business disruptions and paradigm shifts, leaders are adopting digitalization to not just constantly evolve strategies, transform business models, make improvements in functioning, but attain a competitive advantage. They are 45% more likely to unlock annual revenue growth of more than 10% with digitalization. A study at MIT even found that companies that adopt digitalization are 26% more profitable than their peers!
All that coupled with the pandemic-ushered imperatives have led to 8 in 10 organizations fast-tracking their digital transformation within months in 2020. Major digital transformation initiatives are centered on re-envisioning customer experience, operational processes, and business models. Companies are changing how they interact with customers, revamping operating models, redefining how functions interact, and even evolving the boundaries of respective firms.
But how does one bring about an organizational-level digitalization? Is it a plug-and-play implementation of specific solutions? Does it require strategic road mapping? Can it be modular and unique for different enterprises? Should we take a top-down approach? These are just some of the questions that plague a business leader’s mind while standing at the brim of digitalization investment.
Successful organizations aim for proactive integration, not Isolation
To answer all the aforementioned questions, a leader must first understand that there is no shortcut to digitalization. They must focus on the “how” part more than the “what” part. And for that, they need to step back and ask the most crucial questions about their transformative vision, expected results, and KPIs. Once that is done, they can dive deeper and achieve long-term, hiccup-free digitalization.
1. Transforming Traditional Data Management – The notion of “Information being an asset” is still in the early adoption phase, which makes data management a competitive differentiator for digitalization. Gartner predicts that by 2022, 90% of business strategies will revolve around information as a critical asset and data management as a critical competency. The ability to streamline vast amounts of structured and unstructured data by collecting, consolidating, enriching and disseminating often in real-time, is what underpins most digital transformation efforts, and often forms the basis of driving successful digitalization workflows and high efficiency. Large amounts of well-managed data deliver a better operations, customer experience, and market reach and can also be integrated with an analytics or AI program. For instance, a business can track how materials, finished goods, and/or information assets are moving through the supply chain with quality data collation, cleaning, and visualization. This can enhance the efficiency of the entire value chain and improve distribution, logistics, manufacturing, and even sales.
2. Empowering Employees with Automation – Today, employees expect administrative results in a few taps. They also want to focus on the strategic or the core aspect of their job while working in (mostly) hybrid models. Automation is the first step to enhance their experience and forge ahead on the path of digitalization. 84% of CEOs understand this and their digital-first strategies pivot around basic human needs and the power of automation. When automation is implemented at such scale and socialized as the general model of workflows, it impacts every employee’s efficiency, productivity, and innovation. It is not just limited to IT. From automating routine processes to anytime, anywhere access on mobile devices to zero manual data entry or form-fill processes to upskilling content at the click of a button – digital possibilities are endless. It is also helpful in cost reduction, error reduction, scalability, and – above all – productivity. At the end, employee automation also results in breakdown of silos, improved strategic oversight, and better transparency and compliance.
3. Improving Data Governance – It is ever more important to focus on data governance policies as you venture into digitalization because data often serves as the fuel that achieves specific aims, that needs specialized and sometimes classified handling . To ensure a business makes the most out of this huge data influx, they need to be able to govern it by defining standards, policies, clearances, and rules that are adhered across the company hierarchy. Data governance is intricately linked with digitalization and enterprise modernization efforts as it defines the data quality, stewardship, taxonomy, access controls to naming convention, and parameters for compliance, in order to avoid breaches and legal complications Businesses need to apply appropriate regulatory pressures on categorical domains. This slims the chances of discord and violations, bringing criticality to data and makes the process of data management more effective. Top-down leadership involvement is also critical to establish data-governance councils for full-scale digitization and value creation at the point of production and consumption.
4. Incorporating superior go-to-Market Practices – We all know that digitalization is much more than adoption of a variety of digital processes. As per the book, Leading Digital: Turning Technology Into Business Transformation, it involves a “radical rethinking of how an organization uses technology, people and processes to fundamentally change business performance.” The first step of digitalization is upgrading the underlying technology by renovating or replacing legacy systems. This has a strong correlation with go-to-market (GTM) strategies. How? Digitalization removes the disparity in decision-making and democratizes data across business units, value chains, and geographies. And of course, there is the added benefit of more data-based insights and scope of employee innovation. When drafting a GTM strategy, remember that new technologies will not change the business, but only simplify processes. As a thumb rule, be pragmatic with your GTM to ensure speed with a limited offering in limited geographies. Gain strong traction before scaling up towards value-producing opportunities.
5. Delivering Quality Products to Customers Faster – Gartner argues that digitalization requires not only making existing processes more efficient but unlocking new values for the customers. In fact, nearly half of all organizations digitalize mainly to satisfy their customers by enriching the overall customer experience (CX) and achieve higher efficiency through automation. This entails more than speedy deliveries, advanced UI/UX, or omni channel presence. Customers demand value. They want to make informed decisions and be more in charge of visibility, accessibility, and convenient service. In response, it is projected that two-thirds of the Global 2,000 companies will shift their focus from traditional, offline strategies to more modern digital strategies before the end of 2021. This is why leaders of tomorrow need smart solutions to become agile and customer-centric. Delivering quality also means personalization. Be it with Conversational AI, Big Data analytics, or cloud-based predictive mechanism single – a user-friendly, customized interaction can go a long way.
Dive in. Learn to swim. Navigate seas.
Successful digitalization comes not from implementing new technologies but from transforming
the organization and proactively acting upon the opportunities that the new technologies provide. Incorporating a 3-pronged company-wide approach involving people, processes, and technologies—organizations are striving to improve the way IT supports, enables, as well as facilitates working for various departments and functions. The improvement in operational processes, internal collaboration, and partner engagement ultimately cascades to the end-user.
While the actual strategy depends on the individual business, its core competencies, and its growth vision, the overarching principle of digitalization remains the same. The key is in re-envisioning and doing things better and faster to achieve the initial objectives. It cannot be entirely technology-led. It must have other ingredients of management and human drive. With the right approach, any business can surf over the digital wave and explore the horizons of possibilities and revenue generation.