Digital Transformation – What Is It and How Do I Do It?

Digital transformation can have a big impact on the product and service delivered to your customers but also in the way that it is delivered. But what is it and how does it work?

digital transformation

We’ve been working with a number of organisations on digital transformation process over the past 24 months. We often encounter people asking for transformation projects who are actually really need digital marketing services, likewise we are also approached by people asking for digital marketing services who really need digital transformation services.

Lets start with the transformation part of the phrase. Transformation implies changes that touch multiple parts of the organisation from operations, finance and marketing to customer service and event the end product. I prefer to look at digital as a broad way of using new (and old) technologies to connect with people and make these changes happen. The objectives for digital transformation projects are usually to give the organisation a leap forward to ensure they’re leveraging digital technology to better serve their customers.

So what’s the difference between digital transformation and digital marketing?

Digital marketing is usually more focused on harnessing digital technology to reach and engage with potential new and existing customers. The objective might be to acquire new customers or to retain existing customers for longer.

Is digital transformation just a case of getting lots of digital tools in place to make things more efficient?

No, digital transformation is usually much more complex than this. The toughest part of any transformation project is always the people that it impacts. These people often span across lots of different groups of stakeholders, all of whom will be impact in different ways by digital transformation projects, these groups of stakeholders can be broadly defined as employees and customers.

So what is digital disruption?

Digital disruption is mainly used in the sense that an industry, way of doing business or society in general is being changed significantly by organisations who have mastered digital to deliver solutions and ways of working that result in a big shift in customer behaviour and potentially the context of the whole market. These digital disruptors could be start-ups or established players but it’s often startups with venture capital funding who are most feared as these organisations are typically more agile and can sneak up on more established businesses who might not be able to move quite as fast. This means that existing players who haven’t yet mastered their digital skills need to change their strategies, so keeping up with digital disruption could result in a digital transformation project being needed.

If you distil disruption down to what it actually is, it usually boils down to the customer and changing customer behaviour. These behavioural changes might be lead by the customers themselves or may be influenced heavily by organisations who are embracing digital disruption in delivering their product or service, take for example, Uber who, in a matter of years have changed the way that a large portion of customers travel when they need to get from A to B.

So is digital and digital transformation all about the customer experience?

No, although the customer experience might be a key driver for digital change, there are often also big opportunities to change the internal workings of an organisation to deliver efficiency, productivity improvements and to improve employee relationships and ways of working.

Digital transformation can have a big impact on the product and service delivered to your customers but also in the way that it is delivered. Here are some examples of how digital could impact your organisation in different ways:

  1. Customer – seamless, multichannel experience
  2. Products & services offered – new digital specific products and service offerings, reinforce existing products with digital capabilities to improve customer value and ongoing development of the product, for example AirBnB can now use demand data from customer behaviour on their website to recruit different types of properties in different locations at various times of year
  3. Distribution, marketing and sales – digital marketing with improved measurement capabilities should result in improve return on investment. Digital combines with existing distribution channels to enhance the way the product/service reaches customers for example real time tracking and/or video connection to sales teams
  4. Digital fulfilment – increased automation and ability to provide virtual administration
  5. Risk mitigation – improve customer targeting and automate risk profiling to reduce instances of fraud and other issues
    Enhanced control and reporting – availability of and access to real-time performance insights to aid faster, more accurate decision making. Integration with third party systems to enable extraction of additional insights.
  6. How do I get started with my digital transformation project?

It’s often useful to start with the what, why and who when it comes to digital transformation. The answers to these questions will help you form the basis of your digital transformation strategy:

What do “we” want to achieve?Why do we want to transform and who else do we need?Who can help us with the “what”?
What is the long-term objective?Why do we see a need to transform?Who can help with gathering insights?
What are intermediate objectives?Who can validate this?How do we bring various informers together?
What do we need to do first?Who do we need to involve?How is the customer involved?
What knowledge do we need?Who do we have and what capabilities do they have?Who does what? Who takes the lead for which parts of the project?
What needs to be connected?What other capabilities might we need from who?What external data sources can we use to sense check our goals?
What skills do we have and need to do so?Who can connect what?Who signs off the strategy, resources needed and KPIs to achieve the what?

You can then use the answers to the above specific questions to form some broader strategic level answers to these questions:
Why do we need to transform?
What do we need to transform?
How can we transform?

The basic answers to these questions will help you (and more importantly) others in the organisation to be 100% clear on what you’re looking to achieve from the project.

If you’d like help delivering on your digital transformation goals then talk to us today.