Digital transformation represents a modern day survival of the fittest. And let’s face it, not every company has the fortitude or leadership needed to brave the digital landscape.
Climate change is a fact. At least, it is for market climates. Cloud, hybrid and open-API platforms have presented new elements to prehistoric worlds of hard copies, hard drives and hardware. This new technology has unleashed new variables and a sudden shock to legacy companies still fumbling with concepts as juvenile as file sharing. Digital born disrupters have emerged as apex predators capitalizing off their sleek and agile genetic makeup and adaptive personalities.
We are witnessing an extinction. It is subtle, taking form over decades. But it is occurring. Slow, inefficient companies will continue to go belly-up and/or fall victim to stronger competition.
Their only hope is to make a digital transformation.
What is digital transformation?
Digital transformation is the process of adopting modern technology and digital practices to accelerate business activity, improve competency and heighten efficiency. It is more than an emergency technology update. Digital transformation occurs when a company adopts foundational practices and technologies that enable cultural and hierarchal shifts. It isn’t a quick add-on, but rather a disruption that positively subverts traditional practices in lieu of a better, digital way.
A survey conducted by CGI revealed that, “on average, 82 percent of IT budgets are allocated to the mandatory operations needed to run the business, leaving 18 percent for changing the business.” Their study concludes that this behavior perpetuates a “keeping-up” rather than “stepping-up” practice. In summary, companies waste a large amount of money trying to make legacy systems and models work.
To survive the impending digital Darwinism, companies need more than patches. They need to invest heavily on lean enterprise models, even if that means more upfront costs.
According to the MIT Center for Digital Business, companies that have undergone digital transformation are 26 percent more pro table than average industry competitors. Also, they see a 12 percent higher market valuation.
Where do you invest and why?
That’s the golden question. Digital transformation is different for every business. Does your company need lungs or gills? How a company evolves largely depends on its environment, budget and current capabilities.
Three things to look at:
- Where is your company core?
- How does your company communicate?
- What are your biggest time wasters?
The first question should prompt discussion around silos. A modern company needs to function on a common platform. To that end, your chosen CRM or unified operational database can dictate the survival of your business. Companies that elect cloud CRMs like Salesforce, Oracle, Microsoft Dynamics, Zendesk, etc., have a distinct advantage. These solutions are architected for the future and supply a complete ecosystem of products to support cross-company functions. They can scale up or down quickly and have near infinite business capabilities.
Question two uncovers critical dysfunctions that might exist in your company. Ever play the game of telephone? When a message passes through too many unlinked channels, it may be augmented and distorted. How you talk – both internally and to your customers – can reveal redundancies, broken channels and gaps between departments. If your company can not communicate clearly, inside and out, there is little hope of surviving the future market.
The third question seems overly general, but is more of an expanse on questions one and two. If you have a solid company core and great communications, what else do you need? Companies with good answers to questions one and two may feel they can dust off their hands and easily duck a digital extinction. But having a functional business does not mean your equipped to beat out all the market disruptors at your doorstep. New technologies, like advanced AI and analytics, have opened doors for leaner, more automated companies. You want to do more than survive the digital landscape; you want to thrive. And to do that, you need to find new ways to reduce administrative tasks in lieu of greater, strategic effort.
How do you jumpstart a digital transformation?
If you want to push a digital transformation for your company, you should first look to evaluate inefficiencies and develop a complete vision of company processes. Next you need to chart technology value verses lost opportunity – show stakeholders where they are losing money. And finally, you’ll need to develop a leadership mandate and create a transition plan.
No, not every company will survive a digital transformation. In fact, many companies self-destruct while scrambling to deploy new technology. However, stagnant legacy companies are already doomed. If they aren’t already, they’ll soon start losing to their competition (or new competition).
Companies need to evolve, but the evolution process must be deliberate and well-planned.
Interested learning more? Check out the Five9 e-book, “The Answers to Your Digital Transformation Questions.”
In our book we revisit digital transformation as a construct of emerging cloud customer relationship management platforms, and cloud contact center and other software-as-a-service technologies; cloud infrastructure; advanced analytics engines; and artificial intelligence. Learn what you can do to help your company survive the changing digital landscape.