If you have attended a conference, joined a webinar, or read a business article in recent years, you already know that digital transformation is imperative for all businesses of all sizes. Companies must transform their processes, products, communication mediums, and tools to remain competitive and relevant in the digital world.
What is less apparent is what people mean when they say “digital transformation.” From an observer’s standpoint, it seems that industry leaders mean everything from simply moving to the cloud to a complete overhaul of your business. The lack of clarity makes us question if it is worth it.
In this post, we aim to provide an understanding of how we define digital transformation and why it matters to your business no matter your size or industry.
What is digital transformation?
Digital transformation looks different in every company. Any number of factors from size to products to cultural can impact how a company adapts to a more digital customer base. To characterize digital transformation in more general and open terms, we define it as the integration of digital technology into all areas of a business. This integration results in fundamental changes in how companies operate and how they deliver value to customers.
Moreover, digital transformation represents a cultural change that requires organizations to continually challenge the status quo, experiment often, and get comfortable with failure. This change sometimes means that companies must walk away from long-standing business processes that built the company in favor of relatively new practices that have yet to be defined and without proven ROI.
Why does digital transformation matter?
As is evident in the definition, digital transformation calls for a massive overhaul of processes and systems that have worked for businesses and puts into place ones that involve many risks. Why would any company do that? The answer is simple - survival.
Traditional businesses are not transforming by choice. It is expensive and risky. Instead, they are transforming, because they failed to evolve. Market leadership and customer loyalty are no longer assumed. They must be earned every day. Whereas industry giants used to be able to hold their position for decades, now they are facing fierce and evolving competitors. This need for rapid change is also true for small and local businesses. If a company cannot keep up with its customers, it will not survive.
Beyond survival, below are six reasons businesses should consider undergoing a digital transformation effort:
- Your competitors are doing it.
- It will make your more profitable.
- It will make you more efficient.
- Your customers will thank you.
- It will increase your speed to market.
- It will attract and keep employees.
While it is easy to feel woeful about the current status of your digital transformation, one of the biggest misconceptions business leaders have is that they are miles behind their competitors. This belief is because the fastest and earliest transformers have gotten much adoration by the media and other leaders. However, it is much more likely that most of your competitors are similarly situated, and now is the time to act.
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