The advancement of the digital economy and its rapid growth in recent years has completely changed the way organizations do business. In this context, it is extremely important for business and industry leaders like you to understand what a digital transformation strategy is and how it can be implemented in an organization.
Digital transformation is the integration of technology in all areas of a company, changing the way in which the organization generates value for its clients and stakeholders. Digital transformation implies a change in the culture, mentality and way of working of managers, employees, and other collaborators. It leads to the development of a culture focused on innovation, which can also bring a competitive advantage for your company.
According to a Boston Consulting Group study, only 30% of companies that begin a digital transformation process successfully complete it. This is the case because digital transformation is an arduous process and requires the alignment of all areas of a company.
An example of digital transformation
Imagine a company like yours that sells products and provides services to its customers. This company works with two core areas in its business: the one in charge of marketing and selling the products; and the area dedicated to providing after-sales service to customers. Both areas have individual databases, independent sales, monitoring, control and measurement processes and procedures, which makes it difficult to provide comprehensive offers for clients.
Now let’s imagine that this company decides to get involved in a digital transformation process… Broadly speaking, we could think of a context where the top management of the company decides to digitize all operations in both areas: automate monitoring, incorporate a customer data management system, digitize contact with suppliers and the supply chain, among others. To consider this process a digital transformation, it would be necessary for the company to adopt a strategy to unify its offer, ensuring that these two areas manage to work together, optimizing work and mutual collaboration.
Why do you need a digital transformation strategy?
We could talk about several advantages of digitization and digital transformation. Most of the time, digital transformation responds to an organizational need to modernize, changing internal processes, restructuring the culture, and incorporating the necessary technologies to face the constant and changing demands of the market.
The key is that technology should not be a peripheral support in the organization, but that it should represent the heart of the business and support the operations and strategy of each and every one of the company’s areas.
We can understand then that successful digital transformation is a process that can take years, because it involves all parts of a company. But when this process is finally finished, it is capable of generating returns and creating capitalized value in results.
At Huenei we help one of our clients, ICBC, to form a support and maintenance team for the establishment and opening of bank branches. The process represented a digitization of processes and restructuring of the priorities of various areas. The results were very positive, reflected for example in an increase in customer satisfaction indicators.
Another success story related to digital transformation is the work we’ve done for YPF, which consisted in the development of a mobile application for employees, with the functionality of allowing them to request materials for oil wells. Its implementation required, in addition to the development itself, an alignment of different areas and teamwork towards the digitization of activities. The result was an improvement in the work of oil well operators.
Digital transformation elements
- Technology. The most important and advanced technologies today are blockchain, internet of things, artificial intelligence, cloud computing and data science. Most of today’s digital transformation processes begin with the centralization of operations thanks to the cloud.
- Processes. The second key element of digital transformation is processes. These are the organizational dynamics that allow companies to communicate the technology used in different departments with people. In a digital transformation process, the end user must always be at the center of decisions.
- Culture. If you want to change a company, you have to start with its culture. Organizational culture is understood as the set of values, customs and rules that determine the behavior of people within your organization. An adequate culture for digital transformation is one that allows the creation of an environment that stimulates constant innovation, communication between different areas and the use of technology to improve processes.
To achieve alignment with the digital transformation environment, companies need to start thinking more horizontally, move away from hierarchical or vertical dynamics, and focus on finding ways where the different teams of the company begin to share ideas, objectives, and work spaces. In this sense, the advent of organizations focused on learning, knowledge management and the importance of the intellectual capital of organizations is key. Communities of practice are workgroups focused on generating knowledge that can provide your organization with an ideal environment for digital transformation.
Successful digitally transformed companies
During our years of work, we have managed to implement the digital transformation in Huenei, and accompany many clients in their innovation and change processes. From these experiences, we have observed some characteristics that companies that manage to digitally transform share. We’d like to tell you what we believe the main characteristics of successfully digitally transformed companies are.