Digital Transformation in a Post-COVID World
Digitization has always been significant, but the COVID-19 pandemic gave it new and urgent importance. Overnight, companies had to change their business models and adapt to the new normal. Businesses that embraced this found a way to survive the pandemic. Those that didn’t were forced to shut their doors.
Now that we’re looking at a world that is slowly starting to return to normalcy, it’s more important than ever for businesses to take control of their growth and focus on digital transformation to ensure their future. To do this, it’s integral to understand that digital transformation is a fundamental change in the way business is conducted. It’s not just about embracing technology – it involves everything from communication and finding solutions to keeping customers’ wants and needs in mind when managing the supply chain.
The Importance of Digital Transformation
Digital transformation is essential in order to survive in a post-COVID world, but many people wonder why it’s so important in the first place and why businesses need to embrace digitization.
A global survey of 2860 executives by Deloitte investigated this and came to the conclusion that digitally mature businesses are more resilient than and earn more than businesses that are not digitally mature. More than three-quarters of the business leaders who took part in the survey said that digital transformation helped them cope with COVID-related challenges. Their innovation helped them navigate the changes easily, and thus, they were financially successful.
Digitally mature companies were also twice as likely to say that digital transformation was one of the main parts of their strategies compared to less digitally mature companies. In fact, two-thirds of respondents went as far as to say that organizations that won’t digitize within the next five years are “doomed.”
While digital transformation has helped businesses survive the difficulties that came with the COVID-19 pandemic, they haven’t stopped digitizing now that it’s over. They are continuing to spend on digital transformation to remain competitive, improve customer retention, and come up with new ways to boost customer acquisition. Besides helping companies remain competitive, embracing digital transformation has also helped them come up with new opportunities.
Achieving Digital Maturity
As previously mentioned, digital transformation isn’t restricted to simply embracing new technology. Digital maturity requires using this new technology in a meaningful way by integrating it into a company’s capabilities. According to Deloitte, the following capabilities are the key to successful digital transformation.
Flexible and Secure Infrastructure
Technology infrastructure should prioritize security and privacy while still being able to flex capacity in accordance with the demand for the business. Automation and cloud infrastructure are some of the most important parts of this.
Adaptable Business Model
Different business models and revenue streams should be optimized so they can adapt to changing market conditions. A digital business model, digital services, and a digital marketplace are mandatory in this day and age.
Data Mastery
Data should be utilized and embedded into products, services, and operations to increase customer engagement, efficiency, and revenue. Data-driven insights should be used to innovate and improve services.
Intelligent Workflows
Technological and human capabilities should be optimized to make the most of them and possibly free up resources for other, more valuable actions. Chatbots and conversational AIs are two automation possibilities that are rapidly increasing in popularity.
Talent Networks
Training programs should focus on digital improvements and competencies so that in-demand skills are prioritized and the workforce is prepared in accordance with business needs. Businesses should also take advantage of freelancers, gig workers, and independent contractors.
Customer Experience Unification
Offer a seamless customer experience that is the same throughout the company so that any digital and human interactions with customers are coordinated and engaging.
Ecosystem Engagement
Engage with the ecosystem outside of regular business and work with R&D organizations, startup companies, technology incubators, and more to gain access to more resources and innovate and grow.
Advantages of Digital Maturity
When an organization focuses on digital transformation and achieves digital maturity, it can expect the following benefits.
Increase in Revenue
Whether it’s by innovating and introducing new products and services to the market or by improving customer experience as a whole, digital transformation can result in an increase in revenue. In addition to brick-and-mortar stores, investing in e-commerce platforms and providing different options can also help increase revenue and profits.
Efficiency
Digitization such as shifting to the cloud or having more flexible infrastructure increases efficiency and helps cut costs.
Higher Quality
Digitization can also help companies gain new insights into improving their products and services and help them implement these changes.
Employee Engagement
Training programs and reskilling workforces is an excellent way to increase employee engagement. With digital transformation, the use of automation and labor are optimized. This can benefit workers by giving them more opportunities and help them explore alternatives roles at the company, boosting employee engagement in the process.
Customer Satisfaction
Improving the overall customer experience is as important as improving customer service and satisfaction through providing better products and services. Digital transformation can also improve customer experience through digital shopping improvements such as upgraded mobile apps, loyalty programs, and more.
Innovation and Growth
While digital transformation and digitization as a whole help reduce costs and increase efficiency, this isn’t where the benefits stop. Digitization also helps with innovation and growth as a whole. In fact, efficiency and cost savings are sometimes seen as short-term benefits of digital transformation. Innovation, digital maturity, and an increase in opportunities are long-term benefits to embracing digitization.
Digital Transformation Is the Way Forward
Clearly, digital transformation is integral for the future of businesses everywhere. In some areas, adoption has been lightning-fast. Using the cloud, online shopping, and collaboration programs like Slack have been easy changes. Other changes may require more time. That being said, the pandemic has shown us that digital transformation doesn’t have to be a struggle.
Businesses that previously said that they couldn’t make such fast changes have done so in record time. Digital adoption curves have accelerated, and years of digital transformation took place over a few months when the COVID-19 pandemic hit. This is because of businesses taking an entirely different approach to things and making changes that allowed digital transformation. The following are the most important of these changes.
Prioritizing Digitization
According to a global survey conducted by McKinsey, companies have been able to adopt digital solutions 20-25 times faster than they thought was possible. This was especially true for remote working, with solutions implemented 40 times faster than they would have before the pandemic. This was largely because digitization was no longer optional at this point. Adopting this technology became a priority and was dealt with as quickly as possible. When asked about this, many responded by saying that lack of prioritization played a large role in not implementing changes sooner.
Streamlining Investments
The increase in digital transformation and investments also necessitated having to streamline investments. Technological investments have to be re-evaluated so that gaps and redundancies can be identified and addressed. Prior to the pandemic, investments in digital tools and platforms were not regularly evaluated because they were not used as much. With increasing digitization during the pandemic, it became necessary to keep track of the various digital tools and platforms being used and streamline them to suit changing needs. In addition to eliminating redundancies, it’s also important to look for gaps in services. By doing this, businesses can streamline their digital capabilities and use the technology present to their advantage.
Investing in Cybersecurity
As businesses embrace digitization and invest in technology, cybersecurity has become increasingly important. With so much of their information online, keeping this information secure is essential. In an age where security breaches are becoming more common and causing companies millions, cybersecurity is something that cannot be ignored. Since remote work has become the norm, companies are left vulnerable to attacks from malicious parties and have realized the importance of investing in virtual private networks (VPNs), company-wide cybersecurity education, and hiring experts to protect their systems.
Improving Employee and Customer Experience
With remote work becoming the new normal, companies were made to think about employee experience and satisfaction with the work environment. Flexibility was previously considered a privilege, and employees were expected to be grateful for what they had. With flexibility becoming part and parcel of daily work life, this was no longer the case. Maintaining employee satisfaction also became a priority to decrease turnover and eliminate the costs that come with new hires. Because of this, companies realized the importance of a positive digital experience and its impact on the business as a whole.
Businesses were also forced to optimize customer communication since this, too, became digital. Websites and apps were worked on to ensure that customers did not face any issues when shopping and converting. Both customer experience and customer engagement were prioritized, and digital interactions were improved.
Now that conditions are improving and we’re in the post-COVID era, businesses that have survived the past year must embrace digital transformation and take their future into their own hands.
