Recently, American market research, analysis and advisory firm, International Data Corporation published a technology spotlight examining the process of digital transformation in companies and the importance it holds to success. Noting the speed at which new ideas and start-ups can disrupt established businesses, it discussed the different stages that companies may find themselves at and how to approach the process of digital transformation in order to best realise the benefits it can bring. The report focussed on technology with a long-term benefit, rather than temporary gains.
Five different stages of digital transformation maturity were given, ranging from companies which use minimal digital technology and poorly implemented IT services, to businesses which utilises cutting-edge technology to disrupt markets and create new opportunities. The bottom stage represents a disconnect between the business and IT components of a company with an associated lack of focus on customer experience. Following on from this are companies which know they need to innovate but fail to do so effectively – assigning sporadic projects to try and achieve progress. The middle level is where IT is well integrated in a business and enables digital product creation and services; however, there is a lack of focus on the more innovative and disruptive technologies. Companies in the fourth stage are market leaders and provide high quality products or services continually as IT and business goals are fully integrated and aligned. The final stage – the one to aspire to – is for the pioneers in markets which have an in-depth knowledge of the ecosystem and constantly use feedback to innovate and disrupt the sector. These companies embrace new technology in all aspects of their businesses in order to provide the best products or services.
In order to move up the ladder of the digital transformation process, the report described a number of points to consider. Firstly, there is a need for companies to have an honest assessment of the stage they are at in the digital transformation process. From there, discussions would need to take place as to what the goals of implementing the digital transformation process would be and from there, the areas of the company that require input in order to effect the changes needed. The process would result in the setting of standards and milestones to achieve digital transformation. In order to do this it might be necessary to look for third-party options, including consulting services to assess the business and suggest steps for progression.
The types of technology mentioned in the report included using cloud, mobile, business analytics and social media to provide a flexible and scalable approach for improving services. Developments in areas such as IoT, big data, AI, AR/VR, robotics and blockchain have the potential to improve a business for both the company and clients in a wide variety of ways. By fully implementing digital transformation, efficiency, security, customer satisfaction and speed can all improved.
Although easier for smaller or newer companies, it is vital that any business wishing to even remain competitive examines its digital transformation capabilities and has the courage to fully embrace new technology, rather than simple dabble with it. Just as when the internet revolutionised the way business is carried out, newer developments will eventually become industry standards. Large, effective companies no longer keep hand-written ledger books or use pen and paper to work out finances; instead, technology that can do the work faster, more accurately and with less effort has become the norm. We are now reaching a time where new developments in IoT, blockchain and AI, amongst others, will replace those that we have relied on in the recent past. Businesses must adapt and evolve as they have done with every big technological change, and by approaching digital transformation in this way, they will see the best results.