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6 ways digital transformation can improve your business

Sarah Laoyan contributor headshotSarah Laoyan
February 4th, 2024
4 min read
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Digital transformation is the process of adopting digital technologies into your business processes to provide more value to your end customer value to your end customer. While it may sound like tech jargon, it’s actually an important part of business growth. Learn how digital transformation can help improve your business operations and increase customer satisfaction.

Technological improvements are a way of life—things are optimized and improved for efficiency or ease of use. This type of improvement also happens digitally. Software can help establish efficient processes and streamlined workflows. This is commonly known as digital transformation.

When you improve processes using software, you want to be thoughtful about how this tool will affect your team. Otherwise, you can end up with too many tools and notifications to sort through which can affect your team’s focus. Implementing a digital transformation strategy can help your team focus on providing value to your customer, instead of wading through several different tools. In this article, learn more about digital transformation and how you can use it to help bring more value to your customers.

What is digital transformation?

Digital transformation is the act of implementing digital technologies to business processes in a way that changes how your business operates. By improving your operations, you can then deliver more value to your customers. The term “digital transformation” is so widely used that many people think it’s just business jargon. However, digital transformation is an important concept for business leaders to understand. 

The goal of digital transformation isn’t just to add new technologies into your business randomly, it’s to strategically add technologies that will bring your end customers more value than what your team is currently providing. The goal is improvement, not maintaining the status quo.

Read: Understanding kaizen: A guide to continuous improvement in business
Webinar: Make digital transformation successful by focusing on future customers

Learn tips to manage digital transformation from New York Times bestselling author Charlene Li. See why so many organizations struggle with change, and how to avoid common pitfalls.

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Anatomy of Work Index 2022

Examples of digital transformation in the workplace

Here are a few examples of how teams can implement digital transformation:

  • HR Team: An HR team transitions from sending out traditional paper forms to sign offer letters and paperwork to a new digital agreement software to decrease the amount of time spent between the interview and onboarding process.

  • IT Department: An IT team implements a digital ticketing platform system to react to bugs and customer service issues more quickly. 

  • Project management team: A project management team implements a new digital project management software to help house all of the important information in one place. This way, stakeholders can access the information they need when they need it.

Digital transformation looks different for every company, and subsequently this also means that there’s no one set strategy to implement digital transformation. That’s ok. The important thing is to approach the process thoughtfully and systematically. Here’s how.

How to begin the digital transformation process

Similar to most project planning processes, the first step in the digital transformation process is goal setting. What are the goals you are trying to achieve by starting this digital transformation journey? Are you looking to reimagine your customer’s user experience? Or are you looking to target something that focuses more on business needs? Is there anything in your overarching business strategy that you could achieve by implementing a digital transformation? 

Setting digital transformation goals

The best goals are quantifiable—and goals for your digital transformation are no exception. Try using a goal setting methodologies like the SMART goal methodology,OKRs, or problem framing. This helps you identify your digital transformation strategy and gives your team the opportunity to understand and define what the goal is for this specific project.

It’s important to note that customers may not always notice the effects of your digital transformation process. Sometimes the end result are things that are invisible to the end customers—like faster loading times or shorter shipping timelines. The best way to understand if your digital transformation strategy worked is by monitoring your business success metrics.

Using change management to implement digital transformation

As you begin crafting your digital transformation initiative, consider how this change will affect not only your customers, but also the employees responsible for implementing it. Making large, company wide changes can come with resistance from employees—you can prevent this from happening by having a solid change management strategy in place before pushing the change into action. 

If you’re looking to make a change that will drastically affect your customers, consider rolling out a small pilot program to test how they will react. Working with valued customers to gain early feedback can help your team get a better understanding of what your customers are looking for, and how to best provide them value.

Read: How to solve problems using the design thinking process

The benefits of digital transformation

Digital transformation isn’t just about adding new technologies to keep up with the Jones’. When done correctly, digital transformation can help improve your business. Here’s how. 

1. Stay up-to-date with the competitive landscape

If you notice your competitors adopting new technologies, it might be challenging to keep up with them if your company stays with their old, legacy systems. Digital transformation can help your team adapt to changes faster so you can provide new opportunities for your team and stay ahead of your competitors.

Read: How to create a competitive analysis (with examples)

2. Encourages innovation

When your team transitions from a more stagnant business model to a new, more efficient one, it can pave the way for more innovation within your business. This could mean new business models, new opportunities, and even new products. 

Let’s look at an example. When Netflix first launched, they were a rent-by-mail movie delivery service. This gave them an edge above their competitors like Blockbuster and other video rental stores because it saved their customers a trip to the video store. With the help of technology and digital transformation, Netflix decided to shift their business model and became one of the first successful streaming services in history, eventually paving the way for other streaming platforms. This is a strong example of how a successful digital transformation strategy led to industry innovation.

3. Increases team agility

Technology changes at a rapid pace, and if your team wants to be innovative and use cutting edge technology, they have to be receptive to new changes quickly. As you begin adopting new digital strategies, your team will adapt to those changes. The more agile your team is, the more they can pivot when more digital innovation happens.

Read: The beginner's guide to Agile methodologies

4. Provides a better customer experience 

Digital transformation was a crucial part of the invention of many digital based technologies that exist today. For example, artificial intelligence, the internet of things (IOT), machine learning, blockchain, cloud computing, automation, and others would not exist if not for digital transformation. The beauty of the digital age is that all of these developments help improve customer experience. 

Take Spotify, for example. Spotify uses data analytics to look at a user's listening habits and offers them new music suggestions based on their behavior. This strategy helps make a Spotify user’s experience completely unique to them, which strengthens the customer relationship to that brand. 

5. Increases productivity and efficiency

Adding technology to your operation model can increase your business’ productivity and efficiency. Automation expedites more manual tasks that take up a lot of time, such as pushing things through workflows (for example, document approvals or waiting for signatures). 

When you automate more of the time-consuming, menial tasks, this leaves your employees with more time to focus on strategic work that can help your team achieve successful business outcomes, and spend less time on work about work

6. Provides a foundation for scalability

You will often find that start-ups use emerging technologies in their business processes. That’s because digital technologies can help your team create a solid foundation to build on as your companies grow. It’s much easier to implement new digital technologies when your business already has some digital strategies in place. 

Collaborate on your digital transformation strategy

Digital transformation is incredibly helpful when it comes to communication. Technology revolutionized the way teams collaborate and work. The way we work has changed for the better—and digital transformation is a big part of that. Work with your team to figure out the digital transformation strategy that works best for your organization.

Webinar: Make digital transformation successful by focusing on future customers

Learn tips to manage digital transformation from New York Times bestselling author Charlene Li. See why so many organizations struggle with change, and how to avoid common pitfalls.

Anatomy of Work Index 2022

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