You manage what you measure. For many organizations, leaders have traditionally focused on physical capital (for making and selling goods) or human capital (for selling and delivering services). Businesses track inventory, productivity, utilization, and other KPIs to inspect these areas.
In the more digital world, these traditional indicators still hold value. However, while enhancing the digital experience and organizational processes can have a significant effect on the ROI for businesses, it may not have a substantial impact on these traditional KPIs. So what should you track to determine if the digital transformation is producing the desired results?
As with most business initiatives, the ultimate goal of digital transformation is to improve revenue, profitability, and investor value. That said, it may take time to see those results. Therefore, it is useful to track early indicators.
For example, when an organization uses cobrowsing solutions, it will likely experience improved first call resolution and customer satisfaction before it realizes the enhanced revenue. It is critical to measure early and look for clear, relevant metrics to move the needle on specific outcomes.
Digital transformation uses technology to change business operations, customer interactions, and value creation. It is not a single effort. Instead, it is a portfolio of initiatives that together create scalable change.
When considering this portfolio, digital leaders attempt to understand the impact, feasibility, and budget required for each initiative. With this information, they can see how digital transformation could impact the customers and business outcomes. However, without clear KPIs, it is difficult to know what is working early enough to make changes.
Even with robust plans, it is not possible to know that something will work until you try it. Successful companies iterate until they can deliver what the customers want. Similarly, team members look to understand what drives customers to ensure processes and tools also address emerging needs.
With an agile approach, digital transformation leaders avoid getting caught in faulty research, overly complicated specifications, and extended planning cycles. These teams continuously review their actions and investments analyzing the data including cohort analysis, conversion, and customer engagement, as well as the broader competitive environment to make informed decisions.
In Measuring the Customer Experience: The CX Metrics Worksheet, we outline various KPIs that could help determine the success of digital initiatives for multiple goals.
Check out the Digital Transformation Roadmap Infographic to learn more about the process of digital transformation.