From the universal remedy that’s going to fully reshape the way you connect with clients to a money-drainer that doesn’t improve businesses’ efficiency in any way, there are various conflicting opinions about digitally transforming and optimizing your operations. 

To understand the essence of digital transformation, business owners need to understand the components, techniques, and strategies it involves. Here’s the full introduction to digital transformation and optimization. 

 

What is Digital Transformation?

The most straightforward definition of the digital transformation phenomenon is the integration of technology into all facets of business operations, with resulting major changes in lead acquisition, customer support, and team management. 

Digital transformation is both a functional and cultural change. As well as adopting new management tools, business owners need to commit to reforming management strategies and become open to collaboration and automation. 

As for the main components of digital transformation, the following are the most impactful ones:

1. Improved customer understanding

Digital transformation encourages business owners to implement consumer-facing technology. Using big data, in-depth analytics, and other innovations to understand customer needs, shorten buyers’ journeys, and diversify shoppers’ experiences is among the chief objectives of digital transformation. 

Business owners have to focus on creating an infrastructure for customer data gathering, storage, and processing – be it data mining platforms, analytics dashboards, advanced analytics, or other tools. 

2. Digitizing processes

Improved information governance is among the chief points of digital transformation. Now that technology is used to run taxations, manage and pay employees, support customers, and develop products and services, keeping paper-based documentation is inefficient and wastes resources. 

If a business owner wants to commit to digital transformation, switching to digital databases should be his chief priority. Ideally, digital information governance should come hand-in-hand with improved accessibility – that means choosing cloud management tools over on-premises solutions. 

3. Data-driven team management

Since we mentioned that digital transformation is, first and foremost, a cultural change, it should be adopted from within the company. To be successful at preparing their businesses for all-digital operation, business owners need to start by training their teams and investing in project management tools. 

To prepare an organization for digital transformation, its leader has to:

  • Spread awareness of such concepts as data, automation, and analytics, as well as explain the opportunities and the threats the company faces when leveraging the power of these innovations. 
  • Adopt digital-friendly team management strategies – Agile, Waterfall, design thinking, etc. 
  • Determine which tools will help employees improve communication efficiency, create a friendly collaborative environment, and increase each team member’s personal productivity. 
  • Set data-driven goals and benchmarks that would help monitor the team’s performance, compliance with business goals, and continuous growth. 

4. Digital globalization

Digital transformation is a highly open-minded framework. To leverage its full power, business owners need to keep tabs on the latest trends and tendencies in the world – such as increased globalization and interconnectedness. 

What does digital globalization mean for businesses? For one thing, company owners will need to build with scalability in mind, ensuring that the system they created can go cross-border and stay competitive in foreign markets. Other than that, business owners can embrace the benefits of globalization by hiring professionals from all over the world and taking less time to fill in job openings. 

Last but not least, local businesses need to be aware of globalization and understand the risks that are going to manifest if multinational corporations invade the company’s local market. With these considerations in mind, company managers will be prepared to strive in the digital, global, and interconnected world. 

5. Transforming business models

When bracing themselves for digital transformation, business owners need to understand that implementing new changes is impossible without destroying or remodeling existing systems. More often than not, digital transformation will call for business model revision and major changes in the way teams handle lead acquisition, client management, and customer support. 

Here are the strategies business owners are recommended to choose when committing to digital transformation:

  • Improving the existing offer by introducing a digital experience
  • Introducing a digital-only revenue stream without cutting off your online community
  • Fully replacing physical products with digital or creating a convergent digital-physical offer

 

Digital Transformation Benefits

Digital transformation is the only way for businesses to stay competitive in today’s increasingly digitized society. The companies that miss out on implementing digital innovations are slower, less scalable, and struggle to resonate with customers as deeply. 

Although committing to digital transformation is a decision with long-term implications and multiple responsibilities, the benefits of jumping on the bandwagon by far outweigh the hurdles:

 

  • Increased transparency: Both on the operational and consumer-facing level, digital transformation means having a clear view of the way the company operates, how it is perceived by prospective clients, etc. By introducing digital tools, you will be able to track promotion efforts in real-time, as well as provide the team with all needed performance data so that every person on board has a big-picture view of the goal when completing day-to-day tasks. 
  • Facilitated collaboration: Project management tools, communication, documentation, and talent management platforms speed up collaboration, help implement uniform standards across all company’s departments, facilitate employee onboarding, and reduce the amount of manual work a manager needs to perform to keep the company afloat. Automation platforms help fill in paperwork, administrate payments, and handle most common workplace concerns, allowing team leaders to focus on strategizing, research, and ideation. 
  • Reduced operation costs: Using technology instead of paper-based documentation, switching to remote work models instead of in-house departments, and automation instead of onboarding new hires help business owners keep a business sustainable and cheaper to scale. 
  • Customer-centric strategies: In digital transformation, implementing new technology is only the means to the goal of connecting with customers more efficiently, cutting the amount of time needed to negotiate and close deals and increasing clients’ satisfaction with the company. There are plenty of consumer-facing tools business owners can implement as part of digital optimization efforts – CRMs, analytics platforms, etc. 
  • Data-driven decision-making: Since digital transformation provides business owners with hard evidence for building promotion, marketing, and scalability strategies, team leaders can fully remove the guesswork from decision-making. Being able to rely on data when researching new markets or considering product expansion opportunities will protect business managers from risks and will help maximize returns on investments. 
  • Higher customer satisfaction: Digital transformation allows business owners to go hand-in-hand with customer expectations – 24/7 availability, accessibility from anywhere in the world via any device, real-time updates, etc. By introducing technology to all facets of business operations, teams will be able to process more customer inquiries, provide website visitors with relevant content, and meet consumers’ expectations. As such, the level of satisfaction with the company’s services will grow by huge numbers. 

 

Best Digital Transformation Practices

Although a necessity for businesses, digital transformation is a risky endeavor if you don’t have the right mindset or infrastructure to approach it. The good news is, there are ways to protect your business from failing at technological innovation – consider transforming operations with these practices in mind:

  • Establishing project governance and stakeholder management practices: Successful digital transformation implies attracting sponsors willing to back the project financially. Other than that, make sure to regularly update project stakeholders on the progress of the business’ remodeling and run progress meetings to make sure that the transformation process is going in the right direction. 
  • Encouraging technology adoption within the team: Take some time to train staff and get people on your team up to speed with technology tools. Otherwise, poorly skilled employees might end up slowing down the team’s efficiency instead of speeding it up. 
  • Implement incremental improvements: Although it is tempting to fully tear the existing business model apart and rebuild it, keep in mind that such a rash decision leaves the company exposed and non-functioning. Instead of changing the way the business operates all at once, start by implementing low-impact changes that will make adjusting to large-scale reforms much easier. 
  • Account for risks when strategizing: When planning, take possible delays, economic fluctuations, and other external factors into account. A good digital transformation strategy is an agile one – this way, no risk can catch you by surprise, and there will be a contingency plan for any prospective challenge. 
  • Prioritize end-user adoption: When executing digital transformation strategies, business owners often get too caught up in technical details, spending too much time refining the facets of the company that do not impact end-users in a meaningful way. To always stay in touch with business goals, make sure to constantly collect user feedback and prioritize customer satisfaction over a technically impeccable solution. 

 

Digital Transformation Examples

The good news is, digital transformation has been proven successful by numerous companies. To see how business owners successfully integrated innovative solutions into their workflows and customer acquisition practices, take a look at these digital transformation examples. 

Retail

In retail, business owners need to be on the frontlines of digital transformation in order to meet rapidly growing customer expectations. The following practices have proven the most efficient when digitizing and optimizing retail businesses:

  • Automating customer support using chatbots
  • Implementing IoT tools for warehouse management and supply chain monitoring
  • Combining digital and physical in-store experiences (AR displays, connected apps, etc)
  • Leveraging the power of social media to connect with new audiences and prospective customers – creating corporate pages, running social media ad campaigns, etc

Manufacturing

As for manufacturing, the following digital transformation trends are gaining traction among business owners:

  • Internet of Things and interconnected factories
  • Predictive analytics with AI and machine learning
  • RFID tags and blockchain for warehouse management
  • Automated factory equipment

Banking and insurance

Digital transformation presents unique challenges in banking and insurance – such as reliability and data security. That’s why SME owners in these domains need to focus on the following objectives:

  • Creating an interconnected database across all branches of the institution
  • Building international open data banking platforms
  • Providing customers with new experiences in financial education and asset management
  • Automating insurance case processing and assessment

Healthcare

As one of the most conservative and high-stake industries, healthcare lacks the agility needed to be among the frontrunners of digital transformation. Having said that, business owners can bet on the following practices as a way to improve the efficiency of day-to-day healthcare facility operations:

  • Adopting telemedicine applications
  • The development of predictive healthcare
  • On-demand healthcare tools

 

Digital Optimization Benefits

Although the impact of digital optimization is not as evident, it’s a reasonable strategy for businesses that operate in heavily regulated industries – such as banking, healthcare, or law. Here are the benefits of adopting digital optimization practices:

  • High adaptability as business owners and teams have enough time to adapt to every low-impact change.
  • A sustainable strategy that can later mature into a full-on digital transformation strategy.
  • Business owners can implement changes without having to set aside current business goals or reduce the number of processed orders and closed deals.
  • Doesn’t require heavy investments and full commitment the way digital transformation does. 
  • Business owners have full control over the pace of digital optimization; they can stop the process or speed it up anytime, without triggering irreversible changes. 

 

It’s Time to Go Digital

Even if you can’t make up your mind as to whether digital optimization or transformation is the right business development choice to make, the need for introducing new tools and innovations both to consumers and the team is not up for debate. The sooner you commit to digitizing your operations, the more competitive you will be in today’s increasingly connected economy. 

Find out if digital optimization or transformation is right for you and what it takes to get started by contacting Zazmic. Our experts will run a thorough business assessment and create a personalized strategy for your company. Don’t put innovation off and start using the full power of digital tools!