Digital Transformation & its Integral Role in Profit & Growth

The last decade has seen a substantial increase in companies digitizing their operations from top to bottom. Industries & organizations have been chasing digital transformation success to tap into the limitless potential, automation capabilities, in-depth analytics, and a more measurable approach for increased employee efficiency and more personalized customer experience.

The clearly felt and observed benefits of digital transformation has opened even successful business to this idea of better operational success & far-reaching access. Small businesses are using mobile apps to supersede industry giants and create a permanent space in the market.

But how exactly does digital transformation impact organizations & industries? Is there any proof for this hype? Do the numbers add up? Let’s answer each of these questions & walk you through the most effective digital transformation strategy for your brand.

What is Digital Transformation?

It is a constant digital upgrade to redefine customer experience and business functions.

It doesn’t solely constitute moving from physical to the digital platform. A complete digital business transformation is the process of moving to the latest digital technology that customers would benefit from & that can reshape operational capabilities.

Why would any organization spend money & introduce their employees to a completely new way of working, why do companies need digital transformation? The short and crisp answer is to be “more efficient”! A closer glance shows a detailed breakdown –

Automation– Yes, it works & yes, it is always ongoing. People & companies have been automating functions since the beginning of the industrial age. When machines take over monotonous & menial tasks, the human workforce is free for more creative and important tasks.

Customer centricity becomes real– Machine Learning & AI can know a customer better than businesses ever could. With increasing customer size, focusing on the experience of a single customer seems redundant and impossible but with today’s wave of digital intelligence, exclusive targeting, better product suggestions, chatbots have made it possible.

Data-driven decisions- One of the most prominent digital business transformation benefits is the access to limitless data about business goals, current progress, customer behavior and reading this information gives unparalleled insights in understanding what is working and what needs improvement.

Accessibility- Unlimited access anywhere across the globe. Companies gain remote access and flexibility that can keep operations running even through a pandemic.

Companies that got it right

If you are looking for the right digital transformation strategy examples, then take note of these brands that hit the right spot and set themselves apart.

1- Nike

Nike Fit App was an ingenious way to re-introduce themselves to customers. Nike claimed that more than 50% of people wear wrong sized shoes, with Nike fit app customers could scan their feet and know exactly what size fits them.

A unique feature that really hit it off with people. This was a great example of using mobile apps to re-market the brand in a way that hasn’t been done before.

2- Domino’s

There is stiff competition in the pizza space and everyone wants the biggest piece in the box. In 2008, Domino’s hit an all-time low & attempted a digital approach with their app. Customers could order directly from their domino’s app and track their pizza’s in real-time.

Domino’s used it to create a more customized approach for its customers & gave it a big lead over Pizza hut & Papa John’s. Their sales increased dramatically & their online business revenue contributed to more than 60% of its sales.

3- Chipotle

This Mexican fast-food chain turned a new page in their business when they decided to rescue their dying business by investing drastically in their digital transformation agenda.
They introduced an app-based delivery & digitally improved their behind the counter operations.
This transformation boomed their sales. In 2019, chipotle reported a 152% rise in its stock and literally doubled its digital sales – a 100.7% year over year increase!

4- Walgreens

This pharmacy company is over 100 years old but still keeps things fresh. Their digital success can be attributed to their mobile app which allows for an easy prescription refill, video chatting with a doctor & managing medications with convenience.

Thes companies took the help of digital transformation companies to achieve grand success. A business transformation aimed at reaching out to customers doesn’t just end at development, an effective marketing strategy for apps is also a crucial aspect.

Top 5 trends for digital transformation in 2020

This year has already been full of surprises and unpredictability. One common observation throughout the world has been about the importance of technology & robotics. App development companies are great at creating a unique user experience on mobile apps, using the latest technology that aligns with the comprehensive digital strategy.
These 5 digital transformation solutions for 2020 have exponential prospects for growth and not a lot of companies have adapted these completely.

1. 1.  Digital Twins- This fresh new face of digitization is bringing the 2 worlds of physical and digital closer than ever. Digital twins work on the concept of making a digital copy of a physical entity, creating an exact digital replica of a product/machine/factory/structure with sensors on the physical entity that transfers real-time data to its digital twin. This makes overseeing and managing physical assets incredibly easy and reduces the cost of supply chain management.

1. 1. Welcome 5G– This year is going to be the era of 5G internet. With the entry of this new technology, products, and services supporting 5G will swarm the market. We have already seen how old technologies go redundant in the face of a new high powered tech. Ask any Apple user and you’ll realize that people want the best that there is.

1. 1. Wifi 6 – Experts claim that Wifi 6 will bring more than 3x speed of the current Wifi 5 in use. This faster connectivity will support more advanced and inherently heavy processing tools to function without any resemblance of a glitch. A new era of the internet is approaching fast, the upcoming years might make us all forget the zoom call glitches that we experience sometimes.

1. 1.  AR & VR – We have seen Augmented reality enter many industries already, creating waves and making its own space, literally. With AR, the ability to project a digital reality adds an extra dimension to experience and convenience.Virtual Reality gives complete control in presenting and guiding users through the orchestrated design. A truly digital training, educational and market center that has the make, look, and feel of the brand itself.

1. XaaS- Everything as a service also called XaaS is an umbrella term for SaaS, IaaS & PaaS. These acronyms represent the nature of digital services that have slowly gained popularity due to their efficiency & the ability to simplify operations.SaaS- Software as a service gives easy third party access to software through cloud computing. Easy access for companies with no hardware installations and reduced cost. Example- Google docs, dropbox e.t.c.IaaS- Infrastructure as a service, an online service that provides storage & networking. This service makes it very economical to store & operate virtually everything online. It takes away the need for a company to manage live servers as those are operated and managed by the company giving this service. Examples- Amazon web services (AWS), Google computer engine (GCE) e.tc.PaaS- Platform as a service is a cloud model which gives web and app developers an easy to use the platform to create apps. Examples- Windows Azure, Google App Engine e.t.c. Even the Best mobile app developers appreciate PaaS and its feasibility.

Why do digital transformation solutions fail?

Despite the lucrative potential that comes with digitization, one must tread carefully. Easy as it may sound, it is not as easy as creating a new process. Integrating a new way of thinking and doing things isn’t inherent to most companies and their culture. This is the reason that the majority attempts to digitize fail and result in losses.
According to Forbes, about 84% of all attempts fail largely due to the cumbersome digital transformation strategy or uneven execution.

Take note of the following 5 reasons that can lead to a failed effort and cause significant losses-

1) Talent

Yes, the number one reason is lack of the right people who can come up with the right digital transformation roadmap and know about the challenges & potential of the process.

2) Priority

More often than not, companies jump on a speeding wagon despite committing whole-heartedly. If the transformation is throughout the organization then there has to be sufficient training & operational planning to account for the change. Keeping the employees on the same page and communicating benefits and obstacles in advance is absolutely critical, they are the people that have to transition hence they should be heard and understood to fix and accommodate efficiently.

3) Difficulty in Adapting

Some models are challenging and require more proactive action than others. This form of technological transcendence should be handled with preparation and care.

4) Insufficient Funds

Many organizations start the process of a complete company-wide transformation without accounting for maintenance, training & installation costs. Running out of funds between the transition makes it very tough to go either way.

5) Lack of Accountability

Change takes time and patience. There is scope of going wrong and going very right but there has to be preset accountability regardless of the direction. Ownership streamlines the transition and the entire practice.

A holistic digital transformation strategy for Success

The best strategy aims to absorb the most efficient technology without disrupting operational capabilities. Learning from both successes and failures, we have charted the best approach for a winning digitization strategy.

1) Crystal Clear Objective

Keeping the eye on the prize keeps the focus in place and has a motivating effect in spearheading seemingly challenging situations or technologies.

2) Transparent leadership

The role of leadership is most felt in times of great change, be it positive or negative. There is a subconscious expectation to hear from the captain of the ship. Keeping everyone in loop with the company’s objective and expected growth due to the new technology makes a huge impact in embracing the change. As per McKinsey, an attractive story about the whole objective behind the change makes the transformation 3 times more successful.

3) Mindful of company culture

In the book “Culture eats strategy for Lunch: The secrets of extraordinary results” by Kathie Sorensen & Curt Coffman, there is clear evidence and proof that culture is key for any organizational change to be successful.
One doesn’t need to look very far to find proof of the obvious. The human element is acknowledged when it comes to customers but is often ignored when it comes to employees. Systems and processes can come directly in contrast to human psychology if it is not factored in. Leadership must recognize the organizational culture before triggering a change of a digital magnitude.

4) Tech friendly talent

When Subway decided to undertake an organization-wide digital transformation. It hired 150 new employees to fill the gap of tech-friendly talent.
A workforce that is more comfortable with technology, in general, will have a very high chance of adopting digital transformation tools successfully.

5) Let the data drive

The insights that come from making sense of data create an exclusive handbook for success. The increase or decrease of a metric can serve as a preemptive indicator for the future.
This is essential during the process of change and in retrospect while measuring the various matrices. Machine learning & AI has further simplified readings and the authenticity of the findings.

These 5 steps create a blueprint for a smooth and successful digital transformation that is structured and agile to overcome obstacles & usher in a new era of more advanced technology. Total spending on digital transformation efforts is forecasted to cross more than a trillion dollars in the next 3 years. This tsunami of digital evolution has already struck across industries, the ones who build a sturdy, powerful & flexible technology base will sail to success.