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What exactly does digital transformation mean?

Malcolm Cotton, senior partner at Digital Works Group, shares insights into how to transform your business

I suspect very few people would argue with the revelation that digital technologies and applications are relentlessly reinventing and reshaping the way we do business or that they’ve irreversibly changed the way we live our lives. But try to get agreement on what digital transformation means and it’s like trying to find someone who has absolutely no opinion on Donald Trump.

Digital in itself is also so pervasive in everything we touch that many people would argue the word is unnecessary or anachronistic. What we are really describing when we talk about digital transformation is business transformation.

What we are really describing when we talk about digital transformation is business transformation

However, whatever the term or prefix, transformation is, after all, a pretty fundamental word in its own right. Because anything that really transforms is changing its entire nature or form. In business terms this would mean changing the core operating model or infrastructure of an organisation, and let’s face it that’s not a path that many businesses would tread because it’s simply too disruptive and too risky.

In reality, what most businesses do is evolve, some faster, some slower and some more successfully than others. Evolving their channels to market, adapting to consumer demands, responding to competitor threats or launching new products. Often these changes are small and incremental rather than wholesale transformations, and yet the phrase continues to be banded around like confetti at a wedding.

In practice, digital transformation is rarely about a complete overhaul of a business or about replacing humans with artificial intelligence. In the majority of cases, it’s about making micro changes to the operations of a business.

Digital innovations can be as focused as enhancing your customer management system, integrating a chatbot, ensuring you have a mobile-first approach to match the multi-device needs of your customers or safely storing your data into clear data-lakes to fuel your marketing and ensure you are compliant with the General Data Protection Regulation. The possibilities and permutations are literally endless.

And yet, while it’s hard to believe there are any business leaders who don’t readily acknowledge the importance of deploying digital technologies and solutions to remain competitive, there are still many who are holding back from taking that important strategic step forward to embrace the benefits of digital innovation.

We are firmly of the opinion that this inertia is in no small part down to the misconception that digital transformation requires wholesale change and disruption to a business.  Recent studies have highlighted that the biggest barrier to digital transformation, especially in older businesses, is not having a leadership mandate.

The reality for every business is that digital has led to fundamental changes in consumer behaviour. Carphone Warehouse is one example of a firm that was an early adopter of digital technologies, enabling it to become faster at price adaptation, create personalised customer experiences and support multi-channel purchasing behaviours, such as click and collect. Conversely, we’ve also seen retailers like Blockbuster who just didn’t see it coming.

As a digital transformation consultancy we’ve helped many businesses overcome this inertia by taking a considered and educational approach, and by demonstrating the tangible benefits of investment in micro projects as a first step to wider digital transformation. Our in-depth experience of using digital to solve business problems has allowed us to evolve simple yet powerful methodologies.

From our Digital Evolution Curve model, providing clear direction of travel and manageable transformational stages (marketing transformation, company-wide transformation and disruptive innovation) through to blueprints of what works at each stage, we have a tried-and-trusted framework that has been successfully applied to hundreds of brands including Travelodge and Ooredoo.

Whatever your view on the real meaning of digital transformation, one thing for sure is the need to evolve and adapt to the behavioural changes in society – or your business may truly need that rather more fundamental and costly overhaul sooner than you think.

For more information please visit www.digitalworksgroup.com

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