Company Digital Transformation: a magic stick or a painful kick?

The mysterious digital transformation meets us on every corner. Everyone is talking about it. But few understand what going digital really means. Ideally, it should boost sales, business processes, culture, and customer experiences. However, verbally it sounds very impressive. But in practice, 99% of the budget allocated for the transformation is wasted. Why? Let's find out.

Scientifically speaking, digital transformation is the change of the current management and operational systems by introducing the newest digital technologies.
If the company is on the right track, the work will get done easier and faster. Because state-of-the-art technology enables:

• flexible and transparent staff supervision,
• straightforward communication with customers,
• in-depth analysis of the company's activities,
• smart management of sales and transportation, and much more.

Although, it works on one key condition: management and employees clearly understand the essence of innovations and how to deal with them. But unfortunately, digital transformation is often confused with other events.

So, let's talk about the most common faults.

• Implementation of one separate system like CRM, ERP, BPM is a great idea to pump up operational activity, but it is not a digital transformation. Because there is no fundamental and consistent change in all processes, products, and management models.

• Despite the pompousness, buying cool gadgets in the office will also not bring you digital happiness. It makes no sense to print on a smart printer a document, which the manager filled by memory in Excel.

• The same bloopers include chatbots that can't answer most questions, grandiose websites without databases, voice assistants, social media and so on.

The main problem with all these things is incompleteness. So, let's understand what complete digital transformation looks like on vivid examples.

We want to show the positive experience of large companies. Here are 7 real examples that are worth looking at.

• Company: UPS

Area: Logistics and Operations
Digital transformation solution: Network Planning Tools (big data analytics and AI)
How does it work? By analyzing real-time data NPT helps engineers identify and eliminate bottlenecks, decide on optimum delivery transport, how and where shipments should be combined.
Results: company saved millions of dollars and exceeded customer expectations.

• Company: McDonald's

Area: Fast Food Retail
Digital transformation solution: Interactive Ordering Units, AI drive-through, Smart Mobile Ordering and Delivery App
How does it work? By closing modern users' preferences new technologies boost customer loyalty and safety. Moreover, an installed sales ecosystem made it easier to create and receive orders.
Results: company improved in-store, drive-throughs, and home delivery and boosted customer activity.

• Company: MBA

Area: Higher Education
Digital transformation solution: Online educational platform ThePowerMBA
How does it work? By creating a virtual educational platform with 15-minute classes on the desired subject that are available from any mobile device, the content attracts a lot of students.
Results: the number of students has increased several times.

• Company: United Airlines

Area: Air Travel
Digital transformation solution: Agent on Demand Program
How does it work? It's designed to meet customers in-app and provide support, wherever and whenever they need it. Powered by Acquire technology, the mechanism is simple: scan, click, and connect
Results: This program has served thousands of passengers and provided a fast, helpful, and empathetic service.

In addition, hundreds of big companies around the world are implementing crucial digital solutions:

1. Ford creates in-vehicle communications and entertainment systems Ford SYNC and MyFord Touch.
2. Elevate starts using Acquire's live chat and co-browsing to combine customers and support agents.
3. DBS Bank launches a mobile-only bank, DigiBank, in India. That's not all, DBS uses JIM (Job Intelligence Maestro) is an Artificial Intelligence bot to review applicants' resumes.

These companies have one thing in common: a global understanding of what puzzles make a beautiful picture. Let's see what a successful transformation consists of.

We would not be wrong to say that all great things begin with strategy.

• The first part of a digital pie is the Transformation Strategy

In order to get a comprehensive and competent strategy with the main points of its implementation and magic recommendations, you need to hire an IT team with experience in your industry. These guys transform your "I want it to be cool" into a real plan with indicators, deadlines, and instructions.

• The second part is Business Model Transformation

In today's world, there are numerous examples of such transformation from Netflix's reinvention of video distribution to Apple's reinvention of music delivery (I-Tunes). In simple words, the company is changing the tactics of interaction with customers: replacing the positioning of the locomotive product or sales route. Shifting the business model invariably leads to domain changes.

• The third part we consider is Domain Transformation

Sometimes, this part is not required, and the company can develop in the domain chosen initially. But sometimes, an in-depth analysis of the market and company's capabilities makes sensations. For example, in the case of online retailer Amazon, which expanded into a new domain with Amazon Web Services (AWS). In parallel with external changes come internal shifts.

• The fourth piece of the digital pie is Cultural Transformation

The essence of this part is that the whole company, from the CEO to the cleaning team, must understand what is happening and why it is necessary. Transformation should fit seamlessly into the world picture of each employee and not cause internal contradictions. This process will go more smoothly if management assesses all the risks and weaknesses of technology implementation and discusses ways to solve problems with colleagues. Even though there isn't much technology in this part, it's a meaningful component. After all, if the staff responds to the transformation by boycotting, nothing good will happen.

• Digital Transformation Team is the last part of delicious digital transformation

To become mature and digital, you need professionals who will ask a lot of questions, test pilot projects, work with requirements, and refactoring processes. In most cases, such an IT team is outsourced staff, which will also can be a new and rewarding experience of innovative business solutions.

But even knowing these ingredients for success, most companies stumble over digitalization. Let's find out what prevents them from going digital.

The main enemies of transformation are:

• insufficient funding,
  
• lack of strategy and transparent plan,
  
• misunderstanding of the changes among top managers,
  
• staff's objection to innovation due to their unpreparedness,
  
• lack of high quality, appropriate software for the new assignments,
  
• incorrect or partial implementation,
  
• self-transformation without the help of specialists.

So, knowing the enemy by sight makes it easier to fight him. We have compiled a short guide for those who are already thinking about digital revolution in their company. All you need is a bit of honesty. Let's go.

1. Why do we need this?
   
2. How will we do it?
   
3. Who will help us do it?

For the company owner, it is enough to answer the first question. And if the answer wonders, the next step is to hire a team who specializes in business automation and digitalization. The perfect team of specialists consists of:

• business analyst, who helps the owner understand the desires and put them into technical terms,
• 2-10 developers who create platforms, systems, applications, websites, and so on,
• data expert who can think about the architecture of the future data-driven business,
  
• digital marketer who will help with the passing of the brand online,
  
• project manager who will coordinate the team and the customer.

With the right team, going digital will be an enjoyable and efficient business event without stress or financial loss. Such a team will help answer the remaining questions and pump up your business to the digital stars. And finally, we'd like to give you a little bonus.

So, after all, digitalization is a good idea. Especially if you performed it correctly. Lifehack that's sure to work is outstaffing. Stress-free solution for the in-house team, quick and qualified support for all digital problems.

Contact us today, and tomorrow we'll start developing a strategy for your business.

References

1. Amazon (2021). Working Capital Loans Designed with Your Business Needs in Mind.
2. European Commission (2020). Shaping the Digital Transformation in Europe.
3. European Commission (2020). Digital Transformation Scoreboard 2018. EU Businesses Go Digital: Opportunities, Outcomes and Uptake.