The process of integrating digital technology to all areas of a business, changing the fundamental operations and deliver values to the customers is recognized as digital transformations. It also includes cultural change that demands an organization to undergo continual challenge to the status quo, experiment while getting comfortable with failure. Digital transformation is viewed as imperative for all business regardless of the size (form small to enterprise).
This importance to businesses of all levels comes from every keynote, panel discussion, article, or study that is related to how different businesses remain competitive and relevant as the world is growing to become increasingly digital.
Digital transformation is difficult to postulate a unitary definition as digital transformation looks different for every company. In general terms, the definition mentioned at the beginning works. The cultural change means moving away form traditional business processes that form the base of the company in favour of the relatively new practices that are yet to be defined.
There is multiple other definition based on the focus of area within digital transformation that deems as appropriate for the company. For example, an author concentrates on the expectation of what a business could achieve if they undergo digital transformation. He says that it closes the gap between the expectations of the digital customers and what analogy businesses deliver.
Another definition emphasises on the way’s businesses need to alter and adjust their existing practices. Here, the definition is it involves a leadership change, difference in thinking, encouragement of innovation and new business models, incorporating digitisation of assets and an increased use of technology to improve the experience of your organisation’s employees, customers, suppliers, partners, and stakeholders.
Leaders mostly focus on the meaning of digital transformation in practice and how it will be articulated. The focus is on the fact that the term digital itself is a term that means many things to many people and while discussing about digital transformation, the focus should be on unpacking what it means.
Why does digital transformation matter?
The most likely reason to take up digital transformation for a company is that of a survival issue while there may be several other reasons. Businesses are said to transform when they have failed to evolve, and they do not tend to undergo transformations because of the risk and the expenses.
Technology has driven a shift into the maintenance of the companies on the S&P, where the companies remained in one position for longer periods of time are now being replaced every two weeks. Thereby companies must understand how to merge technology with strategy in order to succeed. The leaders of the enterprise have received the message and are prioritizing accordingly.
IDC presented a forecast that the worldwide spending on techlnologies and services that enable digital transformations will peak to $1.97 trillion in 2022. It further predicts that by 2020, 30 percent of the G2000 companies would have allocated their capital budget equal to at last 10 percent of revenue to further promote and fuel their digital strategies and this emphasizes on the importance placed by such companies on digital transformation. This shift in capital funding is significant as it denotes that the business executives recognize digital transformation to be a long-term investment.
The journey of digital transformations is at different places for various organizations while the speed is viewed as business imperative for all. The pressure to show digital initiatives continues to translate to increased agility and speed for the whole organization. The pressure to show such initiatives weighs on the IT leaders. It should be noted that customer experience is a crucial goal which makes it a significant part of digital transformation. Seamless customer experience is the most important discriminating factor for the performance of the business.