Demystifying tech: What is digital transformation, and how does it impact business?

Nathan Baranowski

Our experts demystify the digital transformation process, identifying what it really means and the benefits it can bring to your business.

Digital Transformation

When you’ve been running a successful organisation for a while it can be easy to become averse to change. You know what has produced results in the past so you keep doing it, you may take advantage of new technologies as they become available but your basic business structure rarely, if ever changes.

While such a mindset may work in the short-term have you ever considered that there could be a better way to take the organisation forward? Cue: digital transformation.

The term digital transformation has morphed in recent years into a catch-all for anything that involves the three keys areas of digital, strategy and transformation.

Indeed, perform a simple search of the term online and you’ll see it includes everything from big data and business intelligence, data centre visualisation and DevOps to process automation and Software as a Service.

So, it is hardly surprising that the layman is confused as to what digital transformation is and whether they need it.

What exactly is Digital transformation? 

Simply put, digital transformation is a way of using technology to drive efficiencies, organisational growth and add value to both internal (employees) and external stakeholders (customers/supporters).

A true digital transformation involves completely new thinking; strategically leveraging all the appropriate opportunities offered by digital technology to enhance the customer experience and to create more agile business operations.

Digital transformation involves a more collaborative way of working between departments and customers, breaking down silos and barriers and enabling through transparent data to create new ways of working that achieve your organisation’s goals. On a practical level transformation may mean removing paper and automating processes, but also creating new opportunities and channels previously not available.

Why it is essential in today’s ultra-competitive environment

There is always a risk of stagnation and letting your competitors eat into your market share as they embrace change and move forward with digital transformation while you continue unchanged.

Many people make the mistake of thinking digital transformation is just about employing the latest technology, and they therefore conclude that because they keep their IT systems up-to-date that they must be ahead of the curve.

The truth is that while digital transformation involves technology it is much more about your organisation’s procedures and how your staff interact. A true digital transformation must impact every area of your business from the CEO to the newest recruit.

A transformed structure

Often a digital transformation will involve a remodelled organisational structure. There is no perfect organisational structure that is going to suit every organisation, but the sense of collaboration should be common to all, as the sales team benefits from the knowledge of the customer service department. Marketing and IT can learn from each other, and the finance department gains a better understanding of where the money is really coming from.

To succeed today senior executives need not only to be digitally competent but to understand the importance of cross-department collaboration. They must be aware not only of what those under them are doing, but how they are doing it. What knowledge and skill-sets are involved, and how this information benefits other areas of the business.  Most importantly, senior executives need to enable their organisation to be autonomous and make decisions in a more agile fashion, continually improving. Digital transformation will help them this.

What does digital transformation look like practically?

Digital transformation will appear differently in each industry sector, but the results are always beneficial. To take a few current examples: 

  • When purchasing insurance premiums risk assessments no longer need to be based solely on the customers age or their postcode. Today sensors can be placed in the home or vehicle or even a wearable on our arm which will feed data directly back to the insurer and allow our premiums to be continually assessed, setting premiums accordingly. 
  • The healthcare sector faces many challenges, not least the ageing population and the associated rise in chronic diseases. Digital transformation is leading to increased efficiency through the use of mobile platforms and wider access to patient data. Your digital health passport, if you will.  Through Artificial Intelligence, machines are reviewing scans and x-rays to spot and highlight what we might miss, and process huge amounts of data to model potential cures to diseases. There is also increasing reliance on remote health monitoring where patients provide lifestyle data to medical professionals from their own homes.  
  • The finance sector is ripe for digital transformation and in many cases the move is already well underway with an increasing focus on mobile banking, digital-only banks, and chatbots to reduce costs while providing a smoother customer experience.

By embracing change and moving forward with digital transformation you can safeguard the future of your company and enjoy the operational benefits that come with a more collaborative working style.

If you would like to find out how digital transformation could help you and your business, whatever point you are at on your journey, get in touch with us today.

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