Forbes Magazine predicts that a complete digital transformation will become the key strategic thrust for most CEOs in the future. But what is “digital transformation”?
The term has been used to describe many aspects of how a
company is responding to new technologies and channel strategies. It is used to describe everything from a
responsive mobile website to a newly formed social media strategy to a revamped
IT approach.
In reality, digital
transformation of a company must encompass much more than a single part of marketing
or IT plan. It needs to involve all
elements of the business to take advantage of what some have called the
“digital transformation economy of the future”.
According to Forrester, only 27% of today’s businesses have
a coherent digital strategy to perform as a true digital business. This number is predicted to double over the
next five years, but companies must embrace the concept of a total corporate
and business transformation now, in order to meet the changing consumer demand
and the continued technological advances that will impact how we buy, sell and
market products and services.
Here are some thoughts on how to begin this process.
Digital
transformation will require integrating and consolidating all departments and
functions of a corporation.
Marketing, sales and IT must come together to generate a
single vision and strategy for how and why products and services will be
offered and serviced to customers. All
investments in IT and other functions must build on and contribute to this
single-minded focus, that is based on optimizing the customer experience both
pre and post sell.
Big data will be the
foundation of creating an optimized customer experience.
Successful companies will find a way to harness and use the
massive data that is available to develop new insights on how to personalize
their products and services. As new data
sources are discovered, digital transformation will require evaluation and
adoption of new ways to meet customer needs based on these data streams.
The Internet of
Things (IoT) and artificial intelligence (AI) will be catalysts for expanding
digital interaction between companies and their customers.
Forecasters predict that by 2018, there will be more than 22
billion IoT devices impacting over 200,000 new apps and services. They also predict that we will see a shift in
focus from gathering and mining data to creating new data streams to support
customers in their buying decisions. By
2018, at least 20% of all workers will use “automated assistance technologies
to make decisions, and robots will interact and supervise over 3 million
workers worldwide.
Digital
transformation will demand a culture change to work with new technology and
create a business model change.
Simply adapting your current corporate structure will no t
be enough. Companies and business
leaders need to rethink how and why they go to market, and how to best
integrate that structure to communicate and interact with customers. In a digital economy, a two-way communication
with customers is required as customers control products, services, and
interfaces. Shared communications will
demand new business models for many companies, and will require they use social
and other digital media to generate new insights on consumer needs and demands.
Digital
transformation will be a continuous journey, not just tomorrow’s destination.
Consumer behavior is constantly changing as new technologies
and systems create new products and service capabilities. Companies must recognize and accept that
their long term strategic approach needs to be constantly evaluated and updated
for long term success. And how that
understanding will affect their business model and corporate structure will be
the true challenge for digital transformation.
We must avoid one-off thinking and recognize that true transformation is a project that will never end. That thought can either frighten you, or motivate you. The choice is yours.
Don Morgan
We must avoid one-off thinking and recognize that true transformation is a project that will never end. That thought can either frighten you, or motivate you. The choice is yours.
Don Morgan
Don Morgan is Blog Editor and a
past-president of PSAMA, He is Head
Rainmaker at Raindance Consulting, a brand strategy and content
marketing company. He can be reached at dmorgan@raindanceconsulting.com/
