Digital transformation (DT) is becoming a chief concern of business leaders today. Ironically, those decision-makers who’ve already embraced technology are frequently those most aware of their need to upgrade their digital infrastructure further.

As the name implies, digital transformation is the process whereby an organization implements the latest in industry technology to serve their customers better and eliminate internal bottlenecks. However, the pace of technology in this day and age requires more than stand-alone digital upgrades.

DT experts now use phrases like «perpetual evolution» to highlight the elasticity that digital transformation strategy requires. Not only are business leaders embracing technology now, but they are also looking ahead. The principles of scale apply to DT strategy just as readily as they do in financial planning.

But digital transformation is not merely adding a new software platform or issuing company smartphones to essential staff. DT is forcing leaders and teams to integrate custom-built, technological frameworks that solve specific problems for an organization. Lastly, DT is about staying competitive.

The Speed of Business in the 21st Century

Technological advancements that used to affect a single generation at a time are now revolutionizing one’s lifestyle every 5-10 years. 

Fans of The Office watch their favorite characters mirror contemporary office life across a span of 8 years (2005- 2013). Within those 8 years, employees moved from landlines to flip phones to iPhones.

On a macro business level, the speed of technology is even more frightening. Vanguard’s CIO, John Marcante, noted:

Just look at the S&P 500. In 1958, U.S. corporations remained on that index for an average of 61 years, according to the American Enterprise Foundation. By 2011, it was 18 years. Today, companies are being replaced on the S&P approximately every two weeks. Technology has driven this shift, and companies that want to succeed must understand how to merge technology with strategy.

More specifically, two developments in 21st сentury business – customer experience and internal agility – not only make digital transformation possible but necessary.

Understanding the digital big picture, clarifying and unifying your digital vision, and focusing on integration are all core components of accelerating transformation and finding a place in the digital future.

Polina Khabarova
Deputy CEO, HR Director, Chief Transformation Officer

The Customer Experience

Businesses have learned to anticipate customer needs in a new way. Analytics tools (one of the more common components in digital transformation) show providers how customers want to be sold to, as well as how they prefer to receive help during and after their purchase.

In today’s digital world, customers have a certain expectation. Whether or not a business has embraced the latest in technology, it is vital that decision-makers learn how to meet those customer expectations.

DT, then, elevates the way leaders build relationships with customers and then sustain those relationships for the long term.

Internal Agility

Contrary to the intrusive thoughts of staff members, DT often exists to improve the quality of life for each employee. Employee burnout is, according to Drs. Christina Maslach and Michael Leiter, responsible for millions of dollars lost due to healthcare and employee turnover costs.

The hardest working employees have limited capacity. Decision-makers that employ digital transformation seek to lower costs and human work hours. Simultaneously, business executives know that the right DT strategy can dramatically help employees do more with less.

While it is true that DT automation tools often replace specific jobs, companies that integrate automation without an employee retraining program do so immaturely. The most successful DT automation initiatives consider personnel challenges (such as the need for people with new skills) and take the appropriate steps to transition their existing workforce.

Sustaining the transformation begins with building a common- purpose organization where your organization’s goals are at the center of the community. A smart incentive system coupled with a clear understanding of your community’s roles and a well-defined shared purpose can transform entire organizations from within to make them more adaptable, successful and competitive in today’s digital domain.

Polina Khabarova
Deputy CEO, HR Director, Chief Transformation Officer

Decision-makers Must Commit

Perhaps the most sobering reality about digital transformation is that it inherently ushers in a cultural shift. Executives find that DT is less about «flipping a switch» and more about nurturing their organization into a wholesome environment of new tools and greater efficiency.

According to the Harvard Business Review:

Fundamentally, it’s because most digital technologies provide possibilities for efficiency gains and customer intimacy. But if people lack the right mindset to change and the current organizational practices are flawed, DT will simply magnify those flaws.

That’s why digital transformation is not for the faint of heart (and also why more than half of those organizations that attempt DT fail).

Defining Our Terms – What Constitutes Digital Transformation?

The word «digital» in and of itself means any number of things in the minds of executives, managers, and employees. Korn Ferry’s Melissa Swift noted:

Say ‘digital’ to one person and they think of going paperless; another might think of data analytics and artificial intelligence; another might picture Agile teams; and yet another might think of open-plan offices.

DT can (and often does) incorporate many of those things. But understanding the «digital» in digital transformation usually requires leaders to have a working knowledge of the following IT concepts.

Inside the organization, people are driven by the clear definition of the goals and an overarching purpose; and this applies to both consumers and workers. People are more committed and engaged when they see how their collaboration benefits a larger cause.

Elena Volkovskaya
Chief Strategic Marketing Officer

A New Enterprise Architecture (EA)

Today, a successful business merges its company vision with its IT development. Information technology departments no longer exist only to troubleshoot employee email issues.

Executives have added a Chief Information Officer (CIO) to their team because they realize that IT has become its most valuable asset. Enterprise architecture (EA) refers to the collaborative relationship between business strategy and IT initiatives.

DevOps

DevOps refers to the process of merging your IT development and operation efforts. Not unlike theoretical and applied science, programmers must code vision into reality (theory) and then beta test that code to arrive at reliable software solutions (applied).

The success of DevOps leans heavily upon IT project managers to oversee the process from germination to implementation.

Information and Communication Technologies (ICT)

The most critical part of any digital transformation strategy is the ability of teams and departments to communicate efficiently.

Information and communication technologies (ICT) refers to any digital tools that are crucial to key players remaining in contact during business operations. ICT often relates to telecommunication tools such as mobile devices, Internet speed, instant messaging, and video conferencing platforms.

Software Tool Integration

Any DT strategy involves integrating various technologies to work together. IT experts become familiar with existing software solutions, as well as the challenges that exist when migrating current business processes onto the new platform(s).

Software integration is often the most challenging part of any DT plan since customizing technologies for any one business usually means pulling together independent software services. Real digital transformation requires a high standard of seamlessness.

There are several key factors that can support a successful transformation. These include the importance of establishing a shared purpose, goals and vision that helps maintain a high level of commitment among leadership and all levels of the organization.

Polina Khabarova
Deputy CEO, HR Director, Chief Transformation Officer

Iteration

Digital transformation does not occur without bugs, false starts, and (sometimes) utter failures. Just like software companies, organizations that succeed in their DT strategy commit to a process of iteration.

Decision-makers must grow more comfortable with experimentation and out-of-the-box solutions.

The 2 Core Benefits of Digital Transformation

Many overstate the role of automation in digital transformation. But unless an organization seeks to build an army of robots, digital transformation means so much more.

If automation is «heads», then customization is «tails». Each exists to complement and enhance the other. The goal in digital transformation is to curate a technological platform that creates the margin (financially, logistically, and emotionally) for better business practices.

Automation

Most automation upgrades usually occur internally. Many employees perform routine tasks that existing technology can complete faster and with greater accuracy. Thus, automation empowers that employee to focus on his/her core competencies required of the role.

Employees need to understand the brand and values to know where they stand within the organization as its trajectory is changing.

Elena Volkovskaya
Chief Strategic Marketing Officer

Customization

Front-facing business activities often require more «white glove» techniques. DT solutions frequently adorn non-automated tasks with a more dignified air of professionalism. Sales and customer service agents also have extra time and emotional margin to offer more exceptional personalized care.

As a digitally-transformed business explores its full potential, newer customized tools convert formerly customized approaches into routine tasks. This latest batch of mundane tasks can consequently fall into an automation scrum list, allowing front-facing employees to personalize their service further.
This sharpening relationship between human emotional intelligence (customization) and artificial intelligence (automation) is responsible for some of the most impressive endeavors in history, including search engine technology and social media.

Front-end Versus Back-end

«Front-end» and «back-end» are terms used traditionally by IT professionals.

Back-end functionality usually refers to those digital tasks and processes taking place behind the scenes. As such, back-end tools undergird the organization and ensure that everything runs smoothly.

In today’s highly competitive environment, transformational change should be approached holistically. It is a journey and a process rather than a sprint.

Elena Volkovskaya
Chief Strategic Marketing Officer

Conversely, front-end functionality refers to the look and usability of digital tools. Front-end processes matter, since they allow staff members to work more productively and with greater ease. Additionally, front-end improvements make it easier for a company to attract new prospects and transact business.

In Conclusion

As 21st Century business analyzes the state of its existing platforms, it is becoming more vital than ever that decision- makers abandon outmoded tools for sleeker ones.

However, indiscriminate software upgrades hardly do the trick. Genuine digital transformation demands process and cultural overhauls.

It is people that organizations are built on and engaging individuals in playing an active role in the digital enablement of a company is the key to pushing ahead towards success.

Polina Khabarova
Deputy CEO, HR Director, Chief Transformation Officer

 Ensuring Digital Transformation Success 

Despite the number of those corporations failing in their attempts to implement a DT strategy, the successful 30% have one thing in common. They all recognize the urgency with which they must adopt modern tools.

Dion Hinchcliffe at Constellation Research asserts:

The top IT executives in today’s rapidly evolving organizations must match the pace of change, fall behind, or lead the pack. That’s the existential issue at stake in today’s digitally-infused times, where bold action must be actively supported by out-of- the-box experimentation and pathfinding.

As such, the critical ingredient for successful digital transformation is a determination among organizational leaders to make the shift and improve their DT strategy over time.