The 4 Most Important Pillars Of Digital Transformation
Organizations that keep up with the latest trends and technologies are the ones that are able to stay competitive in a modern market. The last few months have demonstrated the need for digital transformation better than ever.
With the outbreak of COVID-19, the major challenge for enterprises is to sustain the business continuity amidst lockdowns, social distancing, and WFH challenges. Digital transformation is no longer an option, but a fundamental business strategy. Let’s dive in further to explore the four pillars of digital transformation.
What is Digital Transformation?
Digital Transformation (DX) is integrating digital technologies in all business areas to improve the way enterprises operate and deliver value to the customers. It represents a cultural shift to more agile and intelligent ways of doing business.
Worldwide spending on the technologies and services that enable digital transformation is expected to reach $2.3 trillion in 2023. Looking at the pandemic and the economic recession, digital transformation will reach $1.3 trillion in 2020 and is expected to grow 10.4% year-on-year. Digital transformation is a long-term investment and here to stay.
Four Pillars of Digital Transformation
Businesses need to understand their customer journeys, behaviors, and expectations before investing in technology. Customers today are much more aware, technologically advanced, and have the resources to do a market comparison.
Customer experience should be the basis of any business investment and the reason why companies like Disney, Apple, Starbucks, and Nike are successful amongst their peers. Their experience creates a deep connection with customers that goes far beyond the product or the service.
A Harvard Business Review survey showed that 40% of respondents said customer experience is their top priority for digital transformation. 72% of respondents in the same survey expect a shift to digital in order to create closer relationships with customers.
Business leaders understand that every interaction with employees has a critical impact on the company. They need to put their employees first and nurture their top talent. A happy and satisfied workforce performs better and brings innovation to the company overall.
Companies with high employee engagement are 21% more profitable. Companies that invest in their employees, provide them with the right technology tools, commit to their development, and appreciate their effort create an effective and productive workforce.
According to the Society for Human Resource Management’s (SHRM’s) new Human Capital Benchmarking Report, low employee engagement can be a costly problem. It cost businesses $44,129 on average to hire new talent and around $986 to onboard a new hire. That means you lose over $5000 each time an employee decides to terminate his employment, moreover the cost of losing an experienced employee.
Cloud technology empowers employees with better collaboration and communication. This gives them a sense of belonging in the organization and promotes loyalty. It creates a meaningful experience for them and helps them connect with the company on a deeper level. Automated processes mean better efficiency so employees can focus on collaborative and creative work that are more satisfying than repetitive tasks.
Innovative thinking throughout companies is the key to transformation. Innovations have the potential to disrupt business models and can have a profound impact on the way firms compete in the digital market.
As per Fujitsu digital tightrope research, almost 60% of IT and business leaders believe their organization does not have the right skills to successfully deliver digital projects.
Innovating business processes helps a company move away from legacy systems, siloed data, and locked-up budgets to adopt modern technologies like Big data, cloud, IoT, etc, and implement them enterprise-wide. This helps to create huge potential for security and scalability.
Innovation brings maximum value for less money, increases speed, delivers more results, and brings value to the business. It provides space for creativity, agility, and open communication which are vital for business success. Businesses can constantly evolve products and services allowing them to solve complex challenges and stay ahead of customer demands.
Digital transformation isn’t just about upgrading technology or software, it’s more about organizational adaptability. Organizations need to create a culture that introduces a technological change with empathy towards people and processes. It helps companies keep pace with the digital transformation making it agile and adaptable.
In a BCG study of 40 digital transformations, companies that focused on culture were 5 times more likely to achieve breakthrough performance than companies that neglect culture.
Digital culture encourages workforces to look outward and engage with customers and partners to develop new technologies. It diffuses decision-making throughout the organization driving transparency and helps organizations refresh core values and embed desirable behaviors such as cross-functional collaboration, continual learning, and performance metrics to align working culture with cultural goals.
The Need for Digital Transformation
Organizations need to evolve to address changing business landscapes. Digital transformation provides a valuable opportunity to update core business functions and automate manual processes. Business leaders can keep their IT spending to be more focused on business results, innovation, and continuous improvement. It provides a valuable opportunity for core business functions and automates the manual processes.
Businesses looking to embrace the digital journey need to have a strong understanding of the options. iLink has decades of experience in creating meaningful digital transformation for global enterprises. Learn more about our technology and services and speak to an expert today.