In Today’s era of volatility, there is no other way but to re-invent. The only sustainable advantage you can have over others is agility, that’s it. Because nothing else is sustainable, everything else you create, somebody else will replicate.
— Jeff Bezos, Amazon Founder
If new technology did not already, COVID-19 forced you to consider digitally transforming your business. Where some businesses went under, others survived the pandemic downturn through aggressive adaptation. Enterprise digital transformation is more important than ever and the key to staying relevant in today’s economy.
Before we go much further, let’s be clear on what we are talking about. Digital transformation goes by different names, including digital modernization, digitalization, DT, DX, or simply “going paperless” or reaching “digital business maturity.” However it is called, you have probably heard of the concept.
Enterprise digital transformation is integrating digital technologies to adapt and improve your business processes, model, domain, culture, or organization. Any technological improvement to your company falls under digital transformation.
Enterprise digital transformation looks different for every company. For some, it could mean a total reinvention of the company. For others, subtle process optimizations. But whatever the scope, digital transformation will fail without proper leadership. You need a strong leader to guide a company through what can be a daunting change.
Andrew Annacone suggests there are four different types of digital transformation: Process transformation, model transformation, domain transformation, and organizational and cultural transformation. These four types demonstrate the massive scope of digital transformation. It can revolutionize every aspect of your business:
1. Process transformation focuses on optimizing finite processes. Whether it be data, analytics, or machine learning, new digital technologies are constantly providing opportunities to improve these processes. People are most familiar with this type of digital transformation because it is often the easiest to implement. If you can make your business processes more efficient with digital technology, do it.
2. Business model transformation requires a more fundamental change. Instead of optimizing processes, model transformation involves rethinking how you deliver value to your industry. Good examples of model transformation include Netflix, iTunes, and Uber. Each of these companies applied a new business model to an old industry. Netflix pioneered streaming in the film industry. iTunes mainstreamed MP3 downloads in the music industry. And Uber reinvented the taxi industry. Consider changing the way value is delivered to your industry with the help of digital technology. You may find hidden opportunities.
3. Domain transformation involves a complete pivot of business type and market. Though it gets little attention, domain transformation can be a great opportunity to grow your business. Think of it as an appendage, not an extension, of your business. Amazon Web Services (AWS) is a great example. AWS is a subsidiary of Amazon that provides cloud computing services on a pay-as-you-go payment model. A totally different business and market from Amazon, AWS was a result of domain transformation. Because the shift to a new business and market is so dramatic, domain transformation requires good strategy and often involves the CEO. Now that technology is no longer a barrier, you can find domain transformation opportunities everywhere.
4. Cultural or Organizational Transformation means redefining and changing company mindset towards digital technology. For example, consider adopting a decentralized organization, agile workflows, and a learning attitude. An open mindset is necessary for long-term digital transformation. Encourage a culture of innovation and focus on the customer. This way, you’ll take advantage of digital opportunities when they come.
As technology improves, digital transformation is necessary for enterprise businesses to survive. It’s the only way to keep up with the rapidly changing global economy. And COVID-19 has only accelerated this trend.
Take Disney for example. Disney has been around for nearly a century. Walt Disney created his short film in early 1923. Since then, it has created 749 films, 12 theme parks, and acquired major companies like ESPN, Marvel, Pixar, and Lucasfilm.
When COVID-19 lockdowns hit, Disney faced a tough decision. Revenue from theme parks and theater releases were plummeting. Still, most stock market analysts expected Disney to wait for the pandemic to pass.
What did they do?
In March 2020, Disney moved to streaming with Disney Plus. Sure, the company could have decided to wait it out, but it decided to change. On a massive scale.
The announcement of Disney Plus shook the business world. The giant media conglomerate decided to make a giant pivot and reinvent itself around streaming. Either Disney expects the pandemic to last a while or it sees an opportunity. Either way, the message is clear:
Digitally transform your business or risk failure.
Opportunities for digital transformation are everywhere. This is due to the vast amount of new technology out there. Consider how you can implement them into business processes. Or better yet, identify an entirely new business model or adopt a new domain.
Here we describe the biggest new technologies to consider:
Among all the technologies listed above, there is bound to be one that could transform your business. Maybe you already use a few of them. The key is to always be on the lookout for ways to adapt. Only then can you make sure your business thrives in the long run.
To get started with enterprise digital transformation, you want to create a company culture that embraces change. A digital culture with a growth mindset. Encourage new ideas to flow from the button up. And hire people that will help your business be more agile: software developers, blockchain experts, or UX and UI designers. Allow the best ideas to be implemented. If you do, your business will benefit and employees will feel more comfortable sharing creative solutions when they come.
Once you have created an agile culture, you need to set goals. Determine what you want. Examine technological gaps that digital transformation could fill. For example, do you still rely on paperwork? Whatever you do, aim for the right “techquilibrium,” or balance between traditional and digital business methods. And make sure you record and share your objectives.
With challenging but realistic goals set, the next step is to establish a budget. Digital transformation can present some expensive upfront costs. For example, you may need to invest in new software or IT staff. Think of areas where you can cut costs to minimize the cost of digital transformation. Whatever you do, stick to the budget so you can move forward with confidence.
With a budget in hand, formulate a strategy to reach your goals. Design an actionable step-by-step plan. To do this, you may need to break your goals down into more specific targets. The more detailed your plan, the easier it will be to follow. Establish a timeline to keep you and your team accountable. That way, everyone stays on the same page and it’s easier to stay on track.
Digital transformation can introduce some instability or uncertainty. So plan to mitigate risk by keeping a firm foot in established business processes. Don’t overextend innovation or abandon business models too quickly. Instead, transform your business one step at a time. That way, you don’t put all your eggs in one digital basket.
Don’t be discouraged if you don’t transform your business overnight. Successful digital transformations keep a steady pace and ensure precision. Embrace micro-revolutions. Every small transformation is a step forward. For example, adopting digital signatures over handwritten ones could be a quick win your business should celebrate. Find other projects that you can connect to metrics that show improvement. This way, you’ll encourage change while building momentum.
Finally, consider hiring a digital transformation partner. Digital transformation can be a daunting process, and many don’t want to invest the time or effort. A third-party could be just what you need to efficiently and securely transform your business into the modern enterprise you want it to be.
Here at Dev.co, we know how important digital transformation is to staying relevant in today’s economy. Never before has the digital landscape been so large and ever-changing.
To stay relevant, your business needs to be agile. So why not start your digital transformation today. And if you need a robust digital transformation partner, Dev.co is here to help. Contact us today to get started.
Ryan is the VP of Operations for DEV.co. He brings over a decade of experience in managing custom website and software development projects for clients small and large, managing internal and external teams on meeting and exceeding client expectations–delivering projects on-time and within budget requirements. Ryan is based in El Paso, Texas.