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What Are the Three Approaches of Digital Transformation?

Nate Canada • Oct 19, 2020

What Are the Three Approaches of Digital Transformation?

Businesses exploring a digital transformation strategy are often looking for a tried-and-tested route to success. In a 2016 report on digital transformation by McKinsey reported that 70% or more of these complex modernization programs don’t achieve their goals. Walking into a minefield, it makes sense that you want to look at a map to see where others have been caught up, or worse.

To provide a scaffold for planning, the digital modernization process is often broken down into three essential components: process, operations, and customer relationships.

The digital transformation team at DeveloperTown believes this is helpful, but thinking about these as separate can also create barriers to achieving all the goals of your project. Process is built into the operations and customer relationships at your business. In fact, it’s how those aspects succeed! And, any overhaul to your operations or customer service will require a change in processes. That’s how they transform!

Making changes easy to manage, implement, and measure is the real work of successful digital transformation. Here are some data points and strategic insights to help you plan the upgrades that will help your business succeed and grow.

What is an Example of Digital Transformation?

Today, digital transformation is achieved through cutting-edge technologies like data analytics, automation, or artificial intelligence. By eliminating or simplifying time-consuming manual processes, businesses achieve more efficiency. Whether it’s making a dollar go further or allowing talented employees more room in their schedules, digital transformation eliminates the unnecessary and expands the horizons of what’s possible by including technology in all aspects of the business.

Automating processes like payroll or using analytics to uncover gaps doesn’t just mean a practical change in the day-to-day work. These new processes also generate a massive cultural shift that every individual must accept. At times, we’ve seen some of the biggest barriers to the success of modernization projects can be employees who aren’t open to the change.

However, according to recent digital transformation statistics, 2020 might be the year that has ended this change resistance for many employees. As working from home during social distancing has become essential for many employees, digital tools have become less foreign and more celebrated. Digital transformation spending has grown by 4-9% across every industry in 2020. Companies are prioritizing technology that helps them enable worker productivity, makes actionable data available faster, and meets customer expectations of online experience.

Who Leads Digital Transformation?

At most companies today, the Chief Information Officer (CIO) is usually in charge of digital transformation initiatives. This means everything from data protection to IT requirements to the change management strategy. However, this centralization of responsibility can be one of the biggest drivers of project failure. Eight in ten digital transformations involve multiple functions or business units. Unless the CIO has an in-depth understanding of each of these entities, they don’t know what they don’t know—and that can catch their whole company unawares.

That’s why many companies have started to engage the entire C-Suite in digital transformation visioning and storytelling, with the need for a sense of urgency around the change conveyed to middle management and on down the chain of command until every employee understands the how and why of the transformation plan. While it’s important to agree who is leading the decision making, it’s equally important to be sure everyone follows—and that they know where this journey is headed.

Digital Transformation Guide for Operations

Using digital tools to improve operations should start with a careful understanding of the current systems. It might be tempting to pursue automating an entire process like payroll or onboarding, but these sweeping measures can create unanticipated issues if it’s not understood how everything integrates.

Plus, why think so basic? Technology like artificial intelligence and advanced analytics didn’t exist a decade ago when digital transformations started. Now, these innovations represent the opportunity to replace more than one step within a series, with human intervention at key stages to check the work or carry out more complex tasks.

Tracking, reporting, and regulatory compliance are some of the operations elements that are usually first on the list for transformation when we are called on to help a business. But through careful listening and fact finding, DeveloperTown often finds more complex opportunities that will continue to transform the business into the future. Think about it: do you want to go through this again in a few short years?

Here are some of the elements to consider as you plan digital transformation to operations processes:

  • How will you invest in training, hiring, and infrastructure for the new technology, as well as to support the growth you anticipate?
  • What functional siloes between departments might lead to change resistance?
  • What pain point does this technology address? Don’t implement technology just for the sake of doing so.
  • What skill gaps and technical capabilities is your team missing that you will need to carry out the project?

It’s also worth noting that companies who try to carry out operations transformation step-by-step routinely see projects stall or fail. According to Gartner, these organizations only report an average of 16% process toward their goals, despite having worked on the project for 12 months. That means when it’s time to change, just go for it!

Digital Transformation Services for Customer Relationships

Digital transformation is essential to improve customer relationships because today’s customers expect digital experiences. Today, even high-trust customer needs like finance management, legal processes, or shopping for a home, car, or appliance are increasingly trusted to technology.

To transform customer interactions for high-trust industries like finance, retail, and healthcare, it helps to examine why customers trust the in-person process to begin with. Taking out a mortgage, shopping for a car, or getting a medical diagnosis is a big event, something we trust more due to the in-person interactions that come with it. Learning to digitize these experiences in a way that still builds trust is defining the most successful digital transformations today.

Digital transformation doesn’t just apply to the customer’s transaction, but also how they are served after they make a purchase. Have you ever been frustrated calling customer service and having to tell the same story three times? Or waited all day for a repair person who you couldn’t track or follow up with? These negative customer experiences can be addressed through technology in a way that meets the customer’s needs without causing the business to incur more expenses.

When deciding the vision for your digital customer service transformation, consider these data points from Salesforce:

  • 66% of customers are likely to switch brands if they feel treated like a number, not an individual.
  • 64% of general consumers and 80% of business buyers expect real-time interaction from brands.
  • 73% of customers would prefer products that self-diagnose issues and order replacement parts or service automatically.

Customer relationships have moved beyond the transaction into a need for customer engagement. Tools like marketing automation for social media and email, chatbots, recommended related products, and augmented reality help businesses attract new customers and retain existing ones. Choosing the right ones to invest in for your audiences can give you the competitive edge.

Successful Digital Transformation Case Studies

All this talk of digital transformation might give you a better idea of the opportunities, but your business still needs to answer a very practical question: What is included in digital transformation? The answer for you won’t necessarily look like the answer for anyone else in your industry. Here are some case studies of digital transformation that make the abstract more practical.

Republic Airways needed to improve the quality of life for their crew so they could retain top talent. Over 200 hours of interviews helped them leverage technology that not only improved employee experience, but also made information exchange easier and tracked compliance information.

Tenant Tracker came into existence when a commercial real estate property manager needed a tool to simply tenant coordination and track documentation. Moving data into the cloud resulted in a mobile option that makes life better for property owners and tenants alike.

Bass Educational Services was created to help students with learning differences connect to the best college experiences for their needs and goals. Leveraging the data collected by the company’s founder led to the creation of the CollegeWebLD app, a tool for students across the US.

These examples of digital transformation represent how a manual process can become more efficient and widely available due to technology. But we’re also proud that they represent the DeveloperTown philosophy of listening-first to employ the best approach possible. Since we know both startups and big business, we bring a broad look at opportunities to the table. We don’t just look at your competitors or rely on a template like a digital transformation pdf. We look beyond what exists around you to see what’s possible and how all opportunities can be leveraged to transform not just your business, but your industry.

Create Confident Digital Transformation with DeveloperTown

Trying to plan your digital transformation? Or facing a stalled IT project you aren’t sure how to jump start? DeveloperTown is the team with the passion, compassion, and talent to help you achieve goals and maybe even find efficiencies you aren’t targeting. Contact us today and let’s transform the world.