Finding the competitive edge with digital transformation

Digital transformation isn’t just about improving online presence; it is also about deploying the right technology to improve business processes and communications so that enterprises can become faster, more productive and more agile against the competition.

Digital transformation, according to research company Altimeter Group, is “the realignment of – or new investment in – technology and business models to more effectively engage digital customers at every touch point in the customer experience lifecycle.”  Digital transformation is going to be key in exploiting opportunities in emerging markets and the companies that will succeed are those that have the right ecosystem in place.

Two-thirds of companies choose digital transformation

According to market research company IDC, 64% of enterprises globally are exploring and implementing digital transformation strategies. Customer experience, flexible business processes and innovative business models are driving the new wave of digital transformation.  Behind it all are technologies such as Cloud, mobile and Internet of Things (IoT), which are fast becoming part of our 24/7 connected world.

“When buyers were asked what characteristics were required for a digital transformation implementation services project to be successful, two characteristics were tied for first place: the ‘ability to achieve desired business outcomes,’ and the ability to ‘deliver innovation that produces results’,” said Gard Little, Research Director, IT Consulting and Systems Integration Strategies at IDC.

Neither is the spotlight all on technology. IDC’s recent Marketscape report into the worldwide market for digital transformation consulting and systems integration services found that buyers indicated a variety of non-IT roles were the key sponsors for digital transformation service projects 60% of the time. These can include marketing and sales, amongst others.

Motives aside, achieving the goal of a truly connected enterprise takes careful planning and thought.  This is only possible when resources inside and outside the company can share data seamlessly between employee, vendor and customer.  This may sound like a gargantuan task, but with the right approach companies can obtain business value at each point on the digital roadmap.

Digital Darwinism

Digital transformation is a do or die situation. Not all businesses will be able to distinguish or keep up with technological changes and how they impact society.  The result is what Altimeter Group refers to as “Digital Darwinism.”  Basically only the fit will survive. You need to make sure you are one of the fittest.

Borders, for example, helped to define the book superstore, but was forced into closure by pressure from Amazon and Barnes & Noble. It lagged way behind Barnes & Noble in setting up a viable online book business, partnered with online store Amazon in 2001 and waited a further seven years before launching its own e-commerce site. By then it had been left way behind.

Using and predicting disruptive technologies to enhance the digital customer experience is a far from easy equation to get right.  But it is about being a pioneer and not being afraid to experiment.  Digital transformation isn’t necessarily about re-inventing the user experience, it is about enhancing it.  As Brian Solis, author and principal analyst for Altimeter Group points out, Steve Jobs didn’t go about re-inventing the MP3 player at Apple, he just made it easier to use!

Start from the end

Digital transformation is a direct result of businesses looking to adapt to a host of disruptive technologies, from smartphones to wearables, that have dramatically changed how we go about our daily lives.  To understand how this has affected the customer experience needs a very different mind-set.

Starting from the end result and working backwards may seem a very odd way to embark on digital transformation. But by looking at the desired outcome you will find that your digital roadmap will be much more manageable.  Do you want improved operational analytics? Do you want to streamline your supply chain? Do you want to lower research and development costs?  By answering the questions linked to your goal you will very quickly improve customer engagement and overall efficiency. 

Companies need to form an interdisciplinary team focused on how business can differentiate itself based on new and emerging technologies.  Companies need to take digital transformation out of the IT box. Why? Because it requires a range of skill sets, impacts every part of a business and needs to be driven from the top down.  Take Cisco, for example.  It has moved to a goal-based management structure and does not dictate where its staff are located.  Instead it finds the right team members for the job using task based collaboration, backed up by unified communications. 

All embracing

Digital transformation is not just about technology or about a new school of marketing.  It may be sparked by technology, but it touches every single part of the business.  It is, if you like, its DNA.  If you think simply investing heavily in technology will see your business through.  Think again.  Digital transformation is what it says on the can. It is about transforming a business to take full advantage of the opportunities new technology brings.

Read more about digital transformation on the Orange Business blogs: