Digital transformation is a major buzzword nowadays: businesses realise that they should be aiming for the implementation of digital transformation within their organization but where do they start? Digital transformation is the integration of technology, digital technology, into every aspect of the business and making it accessible to all parts of the business. By integrating technology, you change the way the business operates at a fundamental level.
If actioned effectively, digital transformation results in accelerated workflow, departments that are integrated with each other and communicate with each other, and, at the end of the day, increased efficiency and profitability.
A major challenge I see in businesses today is the lack of understanding of what digital transformation is, the fundamental need for it, and what it entails. Most digital transformation programs fail due to employee resistance to change and a lack of support from management.
When talking about digital transformation, one of the main objectives is to allow businesses to predict risks and mitigate these risks before they happen, which gives them a competitive edge over their competitors.
A major challenge for businesses to successfully integrate digital transformation is stakeholder buy-in. Digital transformation is a big venture which will affect every department within the business. It needs to be driven from the top down as a strategic goal for everyone to collaboratively work toward.
To succeed in really transforming your business, stakeholders will need to understand how much budget can be allocated towards this, keeping in mind that digital transformation is not just a once-off project but ongoing. Identifying the budget will assist in identifying opportunities, allocating the right resources, and determining the scope.
Businesses need to assess their current state, which allows them to map out where they are wanting to go i.e., assess culture, evaluate the skillsets within the business, map out current processes and operations and identify opportunities and pain points that need to be addressed.
Goals and desired outcomes will need to be mapped out and gap analysis will need to be done where businesses look at where they want to be – this will assist in identifying these gaps.
Once this has been completed a digital transformation roadmap can be created which involves reframing infrastructure, reskilling employees, recruiting new talent, implementing an agile development process, updating your tech stack, etc.
Benefits of Digital Transformation     Â
1.    Data becomes cheaper
When data is processed at one central point, when data is stored at one central point, and accessed via one system, it becomes cheaper. Apart from the practical aspects of data storage, the number of manhours used to sift through that data is reduced dramatically, and users can access that data to get what they need. Employee overlap is all but eliminated.
2.    More accurate resource use
When the potential of data is unlocked, it can be used by multiple departments to increase the accuracy of their core functions. Marketers will be able to target the customers they need to target with the message the customer wants to hear. Budget and other resources are all maximized simply by knowing how to use that data and when to use it.
3.    Drives Innovation and Agility
A digitally transformed business is an integrated business, and that allows existing systems and processes to be rolled out to satisfy new opportunities. Innovation can be prioritised, decisions can be made faster and time to market can be significantly reduced.
4.    Improved Culture and collaboration
Having the right digital tools allows departments and employees to work efficiently together, to know what the other is doing, and to know how working together will benefit all. It streamlines workflow and therefore productivity, and all but eliminates duplication.
5.    Enhanced Data Collection
The danger of collecting data is that it is often done inefficiently: data is collected at every opportunity, but each piece of data is collected independently. For example, your company may have amassed a seemingly impressive 100 million contacts in its database, but if you do not know that customer, understand where they come from, and know why they are in your database, then that data isn’t going to be used effectively. That data probably sits in a data warehouse that has no logic.
6.    Transformation Turns Data into Insight
Many companies have huge quantities of data, but that data sits in a database with no logic, making that data static and with very little useful application and value. It’s almost like having data for the sake of having data – you’ve collected all this data and you feel you need to hang on to it even though you can’t use it. You know it has value, but you have no way of unlocking that value.
Digital transformation unlocks that value by giving multiple tech stacks access to it and giving it the logic it needs in order to be usable across the business. Digital transformation is about turning your data into insight. The better you know your customer, the better you know their needs, and that in turn leads to insight into where they are in the buying process: you know their needs so that you can solve them. Strategies can then be built around turning gaps into opportunities and getting where you need to be commercially.
7.    Maximises the Value of Data
Data is the new gold, but only if used correctly. If a company collects data but can’t use it, it’s like mining gold but not being able to refine it into usable and valuable gold material itself.
And that is the major challenge with data – getting it from the rough ore into a state where it is usable and has value for the business. How do you monetise that data?
In that data ore, you have all the potential information that you need to up-sell, cross-sell, retain customers, reduce churn, predict a customer’s needs and behaviours, and therefore solve them. There are also opportunities to sell that data externally.
If a company has logical, organised data, it can be used to map out customer behaviour, which can then be sold to business partners who would like to understand their existing customers and potential customers’ buying patterns. Â
As with any business, it’s all about generating multiple revenue streams from your assets, and data has the potential to become one of these assets.
8.    Improved Customer Journey
Once you have that customer data and you understand your customer data lifecycle, then you can start thinking about the individual customer and tailoring personalised content for them: who am I talking to with regards to this brand, what are they looking for and what problem are we trying to solve for them, how can we then help to push them further down the funnel? And it doesn’t stop there: how do we then continue to talk to these customers to increase their customer lifetime value with us to make sure that they stay with us for longer, and that they don’t churn?Â
9.    Increased profits
Several studies have established the profitability of a successful digital transformation: approximately 80% of companies that have embraced digital transformation have reported increases in profitability, according to a survey of 3 100 global business decision-makers by the SAP Centre for Business Insight and Oxford Economics. In addition, 35% of digital leaders said they believe digital transformation has already made it easier for them to attract and retain talent, compared to 7% of other organisations.
In a world that embraces digital transformation, we can collect data and then use it intelligently to increase profitability and continuous business growth.Â
Kerry Janse Van Rensburg is Head of Marketing for Customer Acquisition at Ignition Group and sits on the South African Mobile Marketing Association (MMA) Board.Â
