How to achieve great success with digital transformation

Techno­logical change now dominates entre­pre­neurial thinking in all indus­tries. Because it’s about survival of the fittest — customer expec­ta­tions have evolved so much that companies need every advantage to ensure growth, improve products and services and increase efficiency.

Almost every company in every industry is feeling the effects of digital trans­for­mation. Even if a company does not have its own initiative, its competitors may well do so.

Digital trans­for­mation is a complete reimag­ining of how businesses operate, enabled by today’s trans­for­mative technologies – such as the cloud, mobile devices and big data.

According to a 2017 study by Forrester, 38% of business and IT decision makers believe that techno­logical changes such as digital trans­for­mation would have the greatest impact on their business decisions in the next 12 months.

It is digital trans­for­mation that can provide an edge, an oppor­tunity to rewrite the rules of business.

Digital trans­for­mation is happening. Businesses are already making invest­ments in back-office technology — last year’s BT Software survey found that 83% of businesses give high or moderate priority to investing in back-office technology.

Digital­ization allows your business to shorten the distance between what your business wants and what it gets.

Invest in insight systems

Many companies are drowning in data and starving for insights. Leaders must ensure that their companies:

1. Discover the insights that matter most
2. They are embedded in the software that customers and employees interact with
3. Contin­u­ously learn and measure based on results.

Forrester calls what it takes to drive digital businesses “systems of insight.”

This is equal parts people, processes and technology. Companies need:

• Small cross-functional insights teams. These must be sponsored by a manager who is respon­sible for the business income. They combine business expertise, data science skills, technical insights and software devel­opment know-how, all with the goal of finding, testing and imple­menting insights.

• Repeatable insight-to-execution processes. This means integrating data science, collab­o­ration, gover­nance and agile imple­men­tation methods. Without a repeatable process, it is not a system but a time-consuming search for minimal insights.

• An archi­tecture for digital insights. Big data management and agile business intel­li­gence systems include insight delivery engines and data feed management capabil­ities that provide tools for insight discovery, collab­o­ration, and gover­nance.

They are predictive analytics that provide insights that drive companies forward. According to last year’s PwC Global Data and Analytics survey, 81% of companies are using or building predictive systems today (59%) or plan to do so in the next 12 months (22%).

Benefits for businesses could include:

• Improved customer experience
• Increased sales
• Reduced operating costs
• Increased business agility
• Better informed business decisions
• Deeper insights from existing data
• The ability to create new revenue streams with data and intel­li­gence services

Artificial intelligence in the company

Business demand for produc­tivity-enhancing technology is pushing enter­prise software providers to introduce AI into their products. Gartner analysts predict that AI technology will be ubiquitous in every new product and service by 2020.

Artificial intel­li­gence will drive the insights and actions of the future – PwC said last year that 71% of companies are using AI today (51%) or plan to do so in the next 12 months (20%). Companies said they are currently using AI to:

• Mitigate security risks
• Improve business automation
• Gain better customer insights
• Improve efficiency in business opera­tions
• Create and deliver better customer experi­ences

Digital transformation requires companies to build ecosystems

One of the most important steps in any company’s digital trans­for­mation strategy is to establish a digital ecosystem that helps them interact and share and benefit from standardized digital platforms — with goals such as commercial profit and innovation.

They enable companies to interact with customers, partners and even competitors in various indus­tries.

Finding digital trans­for­mation leaders can be a great way for companies to collab­orate, find co-innovation partners, and develop a digital strategy that meets their needs.

They may also find that customers want to both work with them and buy, bringing their own needs and creating oppor­tu­nities to accel­erate the innovation process and develop solutions for their industry.

The digital transformation challenges companies face

Companies under­going digital trans­for­mation face certain challenges that they must overcome in order to make their strategies successful:

Lack of leadership understanding

Digital trans­for­mation requires a top-down approach – leadership that has created a framework for success. This requires commitment and an under­standing of how technology can improve business.

Whether it’s data, artificial intel­li­gence or automation, companies need to find training or new technical talent to close the knowledge gap.

Existing silos

According to the old set of rules, the organi­za­tional structure of a company means that it is divided into depart­ments, each with its own goals.

However, in today’s world, this is a dynamic that causes problems. Digital trans­for­mation requires collab­o­ration between depart­ments, and when they are siled, that is a problem that needs to be overcome.

Legacy applications

Companies may view legacy appli­ca­tions as a barrier to digital trans­for­mation because they rely on this technology for their day-to-day opera­tions.

However, your goal should be to build new trans­for­mation systems alongside these legacy systems, lever­aging historical data that could be extremely valuable going forward.

For example, Sage 50 users have the option to migrate to Sage Intacct to unlock the next phase of their business.

Its cloud-based, AI-powered software closes financial data silos and delivers excep­tional reporting, reduced risk and improved access to infor­mation.

It automates your financial processes resulting in huge time savings and delivers deep financial insights for faster decision-making at the executive and executive levels using Sage Ai.

Discover the benefits of I’m migrating to Sage Intacct today and grow your business quickly.

Data without context

Data without context is just noise. Companies generate massive amounts of data, and when employees get stuck in it without context, every­thing becomes meaningless.

Concerted efforts must be made to ensure that an organi­zation has employees with the proper training in data use and inter­pre­tation.

Lack of ownership of customer outcomes

The C‑suite must have a vision and strategic plan that enables results to be achieved and continuous improvement.

Without this, a vicious circle is created – leadership takes no respon­si­bility, there is no progress, and the rest of the organi­zation is not inspired to make the continuous improvement that digital trans­for­mation is intended to inspire.

Misaligned metrics

Successful digital trans­for­mation requires alignment on key metrics such as customer satis­faction and value creation.

For example, if part of the company is doing well with product devel­opment but isn’t getting sales leads, there’s a problem. There must be metrics that allow each part of the company to identify its role in the value chain.

A multi-pronged approach

For successful digital trans­for­mation, companies must take a multi-pronged approach.

Assess digital maturity and identify gaps

Companies need to find ways to determine their organi­za­tion’s maturity level to provide guidance on where they need to improve their digital capabil­ities.

This means an analysis of how they can drive a digital culture, how they organize and resource this, and how they invest and use customer-focused insights to guide where they need to go.

Build the relationship between business and IT to focus on customer outcomes

For a successful digital trans­for­mation, companies must improve the customer experience in all depart­ments.

Technology is not a one-size-fits-all solution – each company must find its own path to ensure its trans­for­mation leads to positive customer outcomes – the key metric that can guide the way.

Design a two-pronged roadmap – quick wins and platform investments

A digital trans­for­mation strategy could have two roadmaps – one that aims for quick wins and another that focuses on the required platform invest­ments.

Quick wins show improve­ments that are visible to the company, show benefits and can be imple­mented quickly.

Companies will also like to see the direction a platform model approach will take – using large, scalable networks of users and resources that can be accessed on demand.

Invest in core systems with a clear ROI

Digital trans­for­mation will involve signif­icant costs. Therefore, it is important to ensure that invest­ments in hardware and software pay off when it comes to cost savings, when it comes to produc­tivity benefits and reducing ineffi­ciencies through invest­ments in new systems.