What Technologies Enable Digital Transformation?
Table of contents
- Understanding Digital IT Transformation
- What Does Digital Transformation Entail?
- Why Digital IT Transformation?
- Understanding the Digital Transformation Pace
- The Relationship Between Agile and Digital Transformation
- Digital Transformation’s Support for Hybrid Infrastructure
- Types of Digital Transformation
- Challenges Impeding Digital Transformation Services
- What Technologies Enable Digital Transformation?
- Examples of Successful Digital Transformation Strategies
- Capping it Off
Digital IT transformation, at its most basic, is using digital technology to alter a business process to become more effective or efficient. The goal is to employ digital transformation services to improve a current service rather than just re-creating it in a digital format.
Although it seems straightforward, digital business transformation may be a time-consuming, expensive, and complex process that doesn’t always proceed as expected. Building hybrid and unified end-to-end linked digital experiences, boosting operational efficiency, and speeding up innovation is more critical than just digitizing company operations. CIOs and IT leaders recognize these significant technological expenditures as essential for a scalable, robust, and future-proof firm.
Regardless of the company’s size, digital transformation technologies are essential. Yet, many corporate executives are unsure of what “digital transformation services” entails. What technologies enable digital transformation? Does it merit the effort?
Understanding Digital IT Transformation
Depending on the sector and the specific project, each definition of digital IT transformation is unique. However, the significant elements will be rethinking business models, altering the underlying technological stack, advancing customer experience, and perhaps even altering company culture.
Although many digital transformation technologies may be used in digital transformation, big data, cloud computing, and artificial intelligence are now the most popular in the current era. In the following years, we could anticipate several overhyped tech subjects, such as the metaverse, blockchain, and digital currencies, to receive more attention.
However, improving the process transformation and company culture is just as crucial to the success of these programs as advancing technology. Large, established organizations frequently use digital transformation solutions to compete with the more agile, digital-only competition. These digital transformation services frequently have ambitious goals and broad scopes, but they also carry specific hazards.
Although “digital transformation strategy” is one of the most used terms in the IT sector, there are several meanings. Underneath the hype and misunderstandings, everyone agrees that digital transformation solutions include some significant changes to organizational culture.
What Does Digital Transformation Entail?
Contrary to popular belief, corporate transformation involves more than just adding new digital transformation tools and digital transformation services. Instead of tweaking or improving existing IT transformation practices, an actual digital transformation project entails radically reimagining company models and procedures.
Business executives still find it difficult to overcome digital transformation challenges. According to a study from Cass Business School, most organizations do not have trouble developing new ideas. Still, many businesses struggle to capitalize on digital transformation trends or transform good ideas into organizational goals.
This innovation-execution divide helps to explain why disruption and digitalization have historically been associated with agile start-ups. However, there are excellent instances of digital transformation solutions in the business sector as well, so it need not be this way.
Why Digital IT Transformation?
During the coronavirus epidemic, the force of digitization persuaded many skeptics about the beneficial effects of digital transformation. Digital transformation—and the IT departments that carried out the work—helped firms continue operating as regularly as possible under the most trying circumstances when lockdown and social isolation began. IT teams had to quickly provide technological answers to the problems that businesses faced.
Strategies for digital transformation moved at a dizzying pace. As a result, executive teams have given their IT departments the duty of creating remote-working strategies in days or even hours. In contrast, before, they may have hesitated to adopt a multi-year investment in videoconferencing and collaboration tools.
Experts in the IT sector generally agree that CIOs and their teams’ quick digital transformation framework had a significant role in permanently altering public perceptions of IT. As a result, digital transformation technologies are becoming acknowledged as a critical component for long-term corporate performance rather than being considered as a service to other departments, including sales and finance. Underneath the jargon comes to a vital idea: digital transformation solutions assist innovative enterprises in changing the current economic system, and the results are seen everywhere.
Traditional companies are facing competition from agile, digitally savvy players, from Amazon’s influence on retailing to Facebook’s impact on publishing to fleet-foot FinTechs that are upending banking and insurance operations.
According to consultant McKinsey, many CEOs think their organizations’ business models are dated. Only 11% of business owners think their present models will remain profitable until 2023, while 64% say their firms must create new digital enterprises to get there.
It’s also critical to understand that digital transformation solutions are not only an IT issue. Finding areas where digitalization may have a significant positive impact on a line of the company is essential. According to the Harvard Company Review, the digital transformation framework on its alone is a dead end without a more fundamental business shift.
Understanding the Digital Transformation Pace
Projects, including digital transformation solutions, have typically been linked to multi-year plans. CIOs have thought about how technology may assist their organizations in responding to the danger of digital disruption in collaboration with their colleagues in this area of IT transformation. They have since developed a long-term business plan that uses technology to assist the organization in achieving its objectives.
The issue with many of those long-term digital transformation solutions is that they have taken too long to succeed. Incumbents may excel at developing discrete digitalization initiatives, like shifting systems to the cloud or developing new digital channels for marketing. Still, they move far more slowly to overhaul the whole company to accommodate new digital transformation frameworks.
Multi-year digital business transformation plans are simply too sluggish at a time when quick-thinking digital adversaries may enter a new industry nearly immediately. Flexibility and adaptability are the watchwords for contemporary digital strategy technologies, as evidenced by the numerous difficulties in coping with a worldwide epidemic, new geopolitical conflicts, and macroeconomic constraints.
According to McKinsey, during the pandemic, most businesses accelerated their adoption of digital transformation technologies by three to seven years over a few months. This quickening of the tempo leaves a lasting impression. According to the expert, what was formerly viewed as the industry standard for business transformation pace four to five years ago is now viewed as slower than usual.
This desire for speed impacts the tactics for digital transformation technologies. Boards want ongoing iteration rather than discussing five-year strategies. This transition has necessitated a new Agile method of working for many organizations.
The Relationship Between Agile and Digital Transformation
Establishing the proper cultural change program is just as crucial to the process of digital transformation technologies implementation. Organizations must immediately determine their business needs and the best way to fulfill them in the age of digitization. Adopting Agile methodologies is, in the opinion of many managers, the most excellent approach to finding these solutions.
Although agile management has its roots in software development, it has evolved well beyond its origins in product development and manufacturing, according to Harvard Business Review. Agile’s fundamental tenets—decentralized decision-making, cross-organizational teams, and cross-team empowerment—are likely to strike a chord with most business executives, even though they won’t be implemented in every organization in the same manner.
According to seasoned digital professionals, the significant advantage of an Agile strategy is culture. IT personnel and line-of-business professionals may swiftly implement digital transformation strategies and services by collaborating in small, cross-organization groups to examine difficulties and offer digital transformation solutions.
Digital Transformation’s Support for Hybrid Infrastructure
Businesses have already invested significantly in digital transformation services and collaborative solutions. These services will be essential as organizations look for a digital transformation strategy to accommodate a hybrid mix of knowledge workers who work from home and in an office in the upcoming years.
According to the evidence, managing these digital transformation technologies is not simple. While data reveals that professionals who work from home are more productive are becoming more common, their employers are not necessarily as happy to have them away from the company headquarters. Therefore, a productive compromise will be necessary between working from home and the workplace. To help develop the hybrid workplace of the future, managers will need to continue investing their digital transformation funds in technology.
Types of Digital Transformation
The concept of digital IT transformation is not uniform. The four different sorts of digital transformation services are as follows. However, most businesses just pay attention to general changes.
- Process Transformation: Your business’s people, processes, and applications have come together here. Adding technology that can use your team’s skills, achievements, and potential may improve your company’s business processes, services, and business models in the realm of digital transformation. Process transformation offers new strategies for endless activities like data, analytics, and APIs. Effective process transformation may be seen in Airbus’ shop floor work. Airbus has implemented heads-up display glasses to enhance the effectiveness of human inspection of aircraft.
- Business Model Transformation: Process transformation concentrates on specific facets of the business. Changes to business models are intended to address the core components of how value is delivered in a particular sector. Companies are essentially using digital transformation solutions to update old business strategies.
- Domain Transformation: Domain transformation is a topic that doesn’t get much attention but has already shown much promise. The potential of new technology to redefine goods and services, obfuscate the lines between industries, and create chances for non-conventional rivals. Due to this type of wholesale change, businesses have fantastic potential to add new value. The story of online retailer Amazon, which entered a new market domain with the introduction of Amazon Web Services, is an outstanding illustration of how domain transition functions (AWS). In a market historically controlled by well-known behemoths Microsoft and Google, AWS is currently the world’s largest cloud computing/infrastructure service provider. Amazon’s decision to provide cloud services may not have seemed logical, but the online retailer used the tools and services it already had available. For instance, as it attempted to support its worldwide company while also offering essential computing services to start-ups and other expanding firms that were members of the Amazon family, it had already established vast storage capacity. Therefore, everything was possible; all that was needed was the vision and faith to go into the cloud area. The new potential for domain transformation that arises with new technologies should be kept in mind by all firms undergoing a digital transformation.
- Culture Transformation: It takes more than merely upgrading technology or revamping goods to achieve a successful digital transformation. The culture of a company may suffer as a result of an organization’s failure to match its internal values and practices with its digital transformation services. Adverse effects might include a sluggish uptake of digital transformation technologies, a loss of market competitiveness, the initiative’s eventual failure, and lost productivity and income. Conversely, a thorough and cooperative effort may assist in changing the culture so that digital transformation benefits are experienced. Leaders must develop a distinct vision for the change and consistently and successfully convey it to all levels of the business. They must understand what prudent risks are and why they are worthwhile.
Challenges Impeding Digital Transformation Services
Digital transformation solutions can encounter specific difficulties, like with any organizational transformation. For example, companies could experience resistance from staff members, problems resulting from changes to the organizational structure, and financial limitations. Progress might also be hampered by a lack of experience driving the overall digitization strategy and leading digital initiatives.
Realizing the volume of data they now have at their disposal is one of the challenges many businesses face when they embark on a digital transformation. However, making sense of this data, which frequently comes from several new sources, can be difficult.
You probably want to understand how these many channels affect behavior in another if you’ve embraced more contemporary marketing strategies and are now active on social media, employing display commercials, running search advertisements, or promoting in many other places.
What Technologies Enable Digital Transformation?
Thanks to digital transformation tools, organizations may use digital solutions to develop and strengthen their skills. In addition, they allow individuals to improve judgments, develop stronger business ties, and foresee the future when employed successfully.
Let’s look at the leading technologies that can speed up member-based organizations’ digital transformation strategy execution.
- Mobile: Digital transformation services are fundamentally driven by mobile technology. According to the most recent poll, 71% of CEOs think mobile solutions are more crucial to transformation than the Internet of Things and cloud computing. In comparison, 29% identify it as the second-most crucial technology. This illustrates that virtually all corporate executives are aware of the value of mobile technology in digitization. Mobile devices increase the pace and frequency of contact between businesses and consumers. Real-time data is accessible through these interactions, which is practically hard to recreate using any other method. Additionally, they let marketers gather vital information to expand their clientele or tap into untapped areas. Over the next five years, the importance of mobile solutions will rise as digital transformation services are only increasing.
- AI: When it comes to identifying the greatest digital business technology, artificial intelligence and machine learning go hand in hand in this aspect of digital transformation technologies.
Artificial intelligence is the term used to describe a computer’s capacity to replicate human thought and behavior. It is present in all modern high-end technologies, such as voice assistants, computer vision, intelligent gadgets, and natural language processors. It enables businesses, particularly membership organizations, to automate processes, reach decisions more quickly, and interact with consumers using chatbots. A subset of artificial intelligence known as “machine learning” focuses on using algorithms and data to mimic how human brains learn, progressively improving its accuracy. From the incoming data, it draws conclusions and patterns to operate. It enables systems to analyze and contextualize data to automatically activate information or actions without human intervention. Organizations may better understand their data and make more rapid, informed choices by including potent digitalization tools like machine learning and AI in their digital transformation roadmaps and goals. Analyze data to discover intricate patterns and develop forecasts apart from human input.
- AR: Augmented reality is one of the hottest new digital transformation technologies utilized by several sectors. Augmented reality (AR), put simply, is the addition of digital objects, sounds, and other sensory inputs to the actual environment. AR creates visual images by combining real-time data with mobile technologies. This combined view provides a virtual look at the systems that support operators and clients in various ways. In product development, it is best understood. Without needing to create a prototype, augmented reality (AR) enables business owners to assess 3D virtual representations of new items that can be readily adjusted.
- Internet of Things: The Internet of Things (IoT) is a vast network of interconnected devices that can gather and distribute data automatically. The technology connects the device sensors to a centralized IoT platform, which gathers and saves data from the sensors. These are then examined to provide the leaders with helpful information. Additionally, IoT can determine which data should be kept and which should be securely removed. This digital transformation strategy may spot digital transformation trends, make recommendations, and anticipate potential problems. IoT may be used alone or with other tools to help member-based organizations speed up their digital transformation. Presenting cutting-edge solutions to their members may increase productivity, save expenses, and future-proof their enterprises.
- Digital Twin: Using 3D modeling, Digital Twin makes a virtual copy of a procedure or service. It is used to duplicate procedures that gather simulation information to forecast outcomes. They may be coupled with other digital transformation technologies like IoT, AI, and big data to spur innovation. An organization may use more than one kind of twin depending on its needs. For example, digital twins may help member-based companies gain a competitive advantage by enabling data-driven insights, enhanced membership experiences, and higher member trust. It also enables NGOs to analyze data more effectively, enhance donor personalities, increase volunteerism, save operational expenses, and streamline procedures.
- Robotics: The most recent figures show that every fourth firm employs robots to automate jobs that need digitalization. Unlike conventional robots, they can communicate with people and enhance their performance based on the data it gathers. When integrated with AI and IoT, intelligent robotics may help businesses achieve impressive outcomes. They can raise productivity tenfold, increase efficiency, and improve user experience. Using gamification technology at virtual events to enhance participants’ experiences is a fantastic illustration of intelligent robotics in member-based organizations. To keep participants interested, it includes game concepts in the virtual meetings, such as challenges, objectives, and contests. Consequently, it breaks the ice by fostering conversation and sharing solutions to issues among participants.
- Big Data: Big data analytics, a crucial piece of the digital transformation strategy, decodes complex data to expose key details like consumer patterns (including their behavior and interests), market trends, and undiscovered connections. Big data can be organized, unstructured, or semi-structured and range in size from terabytes to zettabytes. Big data can give real-time analysis to aid in making judgments because standard analysis methods are unable to decipher the information due to the complexity of the data.
- API-Integrations: Nearly all platforms for digital transformation leverage the powerful technology of API integration. Through the use of their APIs, it links two or more systems to provide smooth data transfer.It provides a single hub where programs are saved according to their API when integrated into a platform. Identifying the intended requests and providing the appropriate API in response keeps the dialogue flowing. For instance, the API-based integration locates the needed app from the enormous database based on its API. Then, it integrates it into the service whenever a system tries to establish or modify a service. Thus, member-based organizations can develop new services or features by selecting the appropriate application from the unified system. API interfaces are crucial for membership organizations to sync data, increase efficiency, and increase income. It improves processes, avoids system interruptions, and lowers overall expenses because it replaces multiple digital tools.
- Robotic Automation: One of the most recent digital transformation technologies that employ chatbots, AI, and bots to automate manual processes is called robotic process automation (RPA). For enterprises to foster digital transformation, it offers quicker workflows, optimal results, fewer mistakes, and robust system management. RPA has countless applications in a member-based organization, although they are typically employed for jobs where human mistake is possible, such as managing invoices, moving data, and auditing data. It operates by imitating user actions, from basic clicks and business tasks, including copying and pasting, to more intricate workflows and invoicing procedures. In more complex situations, they completely restructure the process to enable quicker and more accurate operations, validation, and verification without the need to halt and confirm. RPA also includes big-data analytics, which enables enterprises to learn about member trends in real time. With this knowledge, groups may enhance the effectiveness and success of their digital transformation plans.
- Cloud: Cloud technology gives enterprises flexibility, scalability, and agility and is a necessary component of the digital revolution. However, traditional storage solutions are insufficient for safely and affordably managing enormous volumes of data. As a result, more sectors are gradually migrating to the cloud. In addition, the solution eliminates the headaches of contacting IT specialists, downloading large files, and manually upgrading applications by storing all the data in the cloud. A SaaS is the most effective cloud solution for managing subscriptions (Software as a Service). In addition, organizations with members may use this technology to improve communication, increase participation, and automate activities.
- 3D Printing: A recent Jabil survey on 3D printing trends found that 36% of participants said that additive manufacturing had altered their way of thinking and doing things. Another 55% said that the practice would soon alter their production strategy. Before a new product is ready for the market, it frequently requires several design iterations and prototypes. This design cycle is significantly shortened by additive manufacturing. For example, with 3D printing, 19 iterations may be made in the same amount of time as one iteration using conventional methods. That represents a substantial speedup over conventional production techniques. Since CAD files are used in additive manufacturing, virtual teams worldwide may work together to establish a standard design community. Coworkers may print their prototypes and collaborate remotely in real-time rather than examining actual prototypes through video calls or traveling to another country. As a result, they can collaborate more quickly than they could with conventional methods. That saves more money than just a single round-trip ticket.
Examples of Successful Digital Transformation Strategies
- Nike: As one of the most well-known sporting goods companies for its footwear and apparel, Nike began to see a decline in sales due to its outdated business model. As a result, Nike decided to use digital transformation technologies to reinvent the brand itself. Since they sell directly to their clients rather than via vendors, Nike can introduce new items more rapidly, and the development cycle is shortened.
- Dominos: One of the most well-known pizza companies in the world, it currently generates four out of every five of its sales through online channels. To get to where it is currently in digital transformation services, Domino has made many adjustments. The organization was able to reinvent itself due to recruiting programmers, digital marketers, and other IT personnel. It will keep investing in creating an automated distribution system in the coming years.
- IKEA: The Swedish furniture business is a fantastic illustration of the digital revolution. This behemoth has become a digital firm with the 2017 release of the IKEA Place app. Moreover, joining the smart home market has upped its game and now gives customers various intelligent home options.
Additionally, the banking and financial industries have undergone digital advancements. Digital transformation may be observed in banks that employ a top-down approach, integrating digital systems, customer experience platforms, apps, and infrastructure.
These few case studies are among the hundreds of instances of success stories. As a result, these businesses can remain competitive in a highly competitive industry thanks to digital technology.
Capping it Off
Digital transformation service—and the IT departments that carried out the work—helped firms continue operating as regularly as possible under the most trying circumstances when lockdown and social isolation began. IT transformation teams had to provide technological answers to the problems that businesses faced quickly.
Strategies for digital transformation services moved at a dizzying pace. Executive teams have given their IT departments the duty of creating remote-working strategies in days or even hours. In contrast, before, they may have hesitated to adopt a multi-year investment in videoconferencing and collaboration tools.
The advantages of the aforementioned digital transformation technologies are generally undeniable in the modern world. However, to succeed in doing business and beat their rivals, organizations should incorporate a suitable technology—or a combination of technologies—into their operation.
These are just a few instances of digital transformation solutions that your company or corporation might use as inspiration for the digital era. If you have any more queries, please contact Veritis, the Stevie Award winner, and we’ll respond with a solution customized to your unique needs.
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