The businesses successfully implementing digital transformation and OpEx are delivering game-changing, measurable benefits. But before undergoing digital transformation, organisations must first be clear on the results they want to achieve.
The desired outcomes of a digital transformation project should underpin an overall strategic vision for the business which will, in turn, inform all decision-making – including investment in technologies.
Typically businesses are looking to achieve one or more of the following 3 things through digital transformation:
1. Improved business processes
The need for speed, quality and efficiency are the big themes to emerge from a survey of business executives conducted by software company PTC in April/May 2018, which analysed the top benefits of adopting a digital model. Improving operational efficiency was cited by 40% of respondents, 36% said faster time to market. By leveraging advanced analytics, organisations can assess processes, with a view to improving practices and, ultimately, minimising costs and maximising profits.
By carefully pinpointing which processes are underperforming and using data to assess the effect of the varying factors on production, businesses can decide how to best tackle underlying issues. It stands to reason that the knock-on cost benefits of yield or quality improvements are often not to be sniffed at.
Meanwhile Distributed Ledger Technologies (DLTs) such as Blockchain can offer huge security and transparency benefits to organisations, particularly those with complex supply chains, where tracking a product’s journey from start to finish can prove tricky. With blockchain, every transaction is recorded on a list of records, or block, meaning records can’t be altered without the alteration of the subsequent blocks. And because transactions and ledgers aren’t contained in one central location, they don’t have a single point of failure for hackers to infiltrate.
2. Increased organisational agility – data driven insights
Digital transformation boosts innovation by opening new opportunities for product and service offerings that were not available before. Big data, AI and automation can be used to help companies understand their industry, customers, and competitors better than ever before.
Analytical and modelling tools can identify hidden patterns and interpret early signals that allow companies to anticipate future customer behaviours. By better understanding how customers behave – and are likely to behave in the future - organisations can stay a step ahead in terms of meeting customer demand, with faster response times and shorter lead times. The caveat is of course that data is only useful if the insights it provides align with the strategic vision and the needs of the business.
3. An enhanced customer experience
The effective use of digital technology makes it possible to understand and improve the customer experience. More than a third of respondents to the PTC survey – 35% - cited the ability to meet changing customer expectations as the main benefit of digital transformation projects.
Data analysts can create an accurate picture of changing demand based on the current realities of consumer behaviour and understand what is driving purchasing. However, gaining an edge over the competition requires businesses to not only meet customer demand but also predict it.
At the same time, customers have come to expect 24/7 availability and customised experiences that empower them to make the best purchase decisions. In the face of increasing consumer demands, deep consumer insights generated through data collected using IoT, AI and advanced analytics, allow organisations to create an integrated and personalised customer experience. A recent study found that 80% of consumers are more likely to make a purchase when brands offer personalised experiences.
The importance of measuring
Measuring the effectiveness of a transformation programme requires sound data that identifies where improvements are needed, enabling activities can be defined, adapted and scaled. Successful transformation programmes are typically measured against a scorecard assessing a comprehensive set of metrics including technical adoption rates and wider business objectives.
By contrast, where transformation projects are not measured against business goals - or where the vision is not effectively communicated - investment in technologies tends to be disjointed and programmes are likely to fail.FREE REPORT:
Making a Success of Digital Transformation and Operational Excellence in 2020
- Where does digital transformation currently sit alongside other business priorities?
- The key technologies companies are focusing on to gain competitive advantage
- Key factors in successfully delivering transformation projects
- Examples of companies at the forefront of digital transformation