As technology advances at breakneck speed, businesses must evolve to keep up with the times. The onset of digital transformation is no longer a buzzword but a reality that all companies must embrace or risk watching their competition overtake them and gain market share. The process can be daunting without taking the right approach but breaking it down into smaller stages helps ease the transition. This blog will discuss the four stages of digital transformation and how they can help your business stay competitive in the ever-changing landscape.
The first step in any transformation process should always be vision development. A company can only move forward with a clear, unified direction with a well-defined end goal. It is essential to define what digital transformation means for your organization. The key to success in this stage is creating a culture of collaboration and innovation. That way, all team members can buy in and contribute ideas to the vision development process. Identify areas of the business that would benefit most and prioritize them.
According to Gartner, 91% of businesses are engaged in some form of digital initiative, and 87% of senior business leaders say digitalization is a priority.
Once the vision is in place, it's time to build the foundations. Create a team that will lead the digital transformation initiatives and have them focus on the company that impacts the organization’s overall process execution or bottom line most. Remember that the aim is not to digitize all processes overnight but to have foundational technology in place that gives the company quick wins while also enabling the company's technological needs to continue scaling over time.
The digital transformation market size is to grow from $695.5 billion in 2023 to $3,144.9 billion by 2030, at a Compound Annual Growth Rate of 24.1% during the forecast period.
With the correct vision and the foundations set, it's time to commit and transform business operations and processes. In this step, typically, organizations will identify the third-party technology solutions that will assist with automating outdated processes, taking the manual work out of operational processes, and integrating technologies into eco-systems. Emphasis must be on having a data-driven approach in decision-making to drive efficiency, sustainability, and scalability. This stage aims to institutionalize digitalization and integrate it fully into the business.
A successful digital transformation is an enterprise-wide effort that is best served by a leader with broad organizational purview. For the second year in a row, CIOs are reported as most often owning or sponsoring digital transformation initiatives (28%), with CEOs increasingly playing a leadership role (23%).
Initiate the final stage when the digital transformation has occurred, and the outcomes can be measured. Now it’s time to see how the new technological approach has benefitted the company. Benefits can be many things, such as reducing the time it takes to complete an order, seeing an increase in numbers, experiencing overall reductions in operating costs, or improving customer experiences, to name a few. Here, the focus is to identify what sets the firm apart and creates a competitive advantage for the organization. Share the updated value propositions with your sales and marketing teams and have them make the necessary strategy and content updates to ensure that your company is positioning itself in the best light. Then move on to the next area that requires digital transformation and start again.
In a survey of executives across verticals, the top benefits of digital transformation were improve operational efficiency (40 percent), faster time to market (36 percent), and meet changing customer expectations (35 percent).
Digital transformation is a process that requires comprehensive planning, teamwork, and a well-defined roadmap. It is a journey, not a destination, and organizations must learn to adapt continually. Digital transformation is essential to stay competitive and not be left behind in this ever-changing landscape. Companies that are slow to adopt new technologies risk irrelevance and possible extinction. With the Stages outlined above, companies can move along the transformative journey to stay ahead of the curve and not be left behind.