Digital Transformation: What Is It and Why Does It Matter?

The reimagining of business in the digital age is digital transformation. As we move from paper and spreadsheets to smart applications, we have the chance to revolutionise our business with the help of digital technology.

As you embark on digital transformation, it’s important to have a full understanding of the technology, as well as a strategy in place to ensure success.

What is digital transformation?

Digital transformation is the process of using digital technologies to create new business processes, culture and customer experiences. This fundamentally changes how you operate and provide value to your customers.

On a deeper level, digital transformation also involves a cultural change, requiring businesses to challenge the norm, experiment and become more comfortable with the possibility of failure.

Understanding digital transformation

Digital transformation is vital to all businesses, regardless of size. It’s more important than ever to stay competitive and relevant in the digital world.

What isn’t always obvious, however, is what digital transformation actually means. It’s more than just migrating to the cloud; it’s about rethinking old operating models and experimenting in order to become agile in responding to competitors and customers. Because technology plays a vital role in the evolution, the chief information officer is a key factor in digital transformation.

Modern businesses are in different phases of digital transformation, with many looking to overcome initial obstacles and fully transition. Even organisations that are far along in the process encounter obstacles, however, such as acquiring talent, budgeting and fostering a cultural shift in the workplace.

Leaders need to consider what digital transformation means in practice. Digital means a lot of different things to different businesses, but the general concept focuses on customer centricity – automating operations and business models with data analytics, software and technologies that help the customer. Before this can happen, the leadership and employees need to be on board.

Why digital transformation matters

While there may be a multitude of reasons for a business to undergo digital transformation, it mostly boils down to survival. Digital transformation can be risky and expensive, so it’s often a necessity for businesses that want to survive and outlast the ones that failed to evolve.

Technology drives the shift in business, and companies that wish to succeed must merge technology with strategy to stay ahead. Data analytics is at the top of the list of priorities, particularly in terms of data visualisation and machine learning.

Speed is also an important consideration. Digital initiatives that foster improved speed and agility for the organisation are at the forefront of digital leadership.

These are the operational priorities, but a positive customer experience is the ultimate goal and is a significant driver for digital transformation. Customer experience can make or break a business, and digital technologies play a vital role in ensuring a positive relationship between businesses and their customers.

What does a digital transformation framework look like?

Digital transformation is informed by a business’s demands and challenges, but there are a few consistencies that apply to all businesses:

• Culture and leadership.
• Operational agility.
• Customer experience.
• Workforce empowerment.
• Digital technology.

Learn more about the Digital Transformation Framework for Success.

What role does culture play in digital transformation?

With the adoption of new technologies, the role of an IT team has fundamentally shifted. Stakeholders want IT teams to generate revenue for the business by improving business processes and developing new and innovative products. Embracing this change means that the entire business needs to reconsider the impact and role of IT in their daily work.

IT drives digital transformation strategy, but efforts to implement and adapt to changes in the business resulting from digital transformation are a company-wide endeavour. Digital transformation leads to fluid departments, processes and job responsibilities, with soft skills like empathy being in high demand.

A business must be supportive and prepared for transformation efforts to help employees stay motivated and succeed. Your team needs to understand why you’re doing what you’re doing, how it fuels success in the future, and how they benefit from the transition.

What drives digital transformation?

Unsurprisingly, the main benefits of digital transformation come from the technology that makes it possible. However, digital transformation is also about removing outdated ideas and processes in favour of new and innovative technology that’s appropriate for the specific business.

For example, many healthcare institutions eschew smartphones and mobile devices in favour of old technology like pagers. These issues can span all industries and organisation sizes, leading to thousands or even millions lost in maintaining legacy systems.

Once legacy technology is replaced, IT teams can devote more attention to new technology and innovation, rather than working with existing IT concerns. Businesses that want to keep up with the fast pace of digital change need to focus on increasing efficiency and implementing new technologies as much as possible.

Digital transformation from a customer perspective

To understand what digital transformation looks like from a customer perspective, we spoke to Dave Keefer, Business Development Manager for KBAC, one of South Africa’s leading flooring distributors.

Can you share how going digital has transformed KBAC?

Dave Keefer: KBAC has been around for over 50 years, but until last year we were still using roughly the same paper-based system that we started with. Customer centricity, resilience and agility were crucial objectives for us, so we knew that it was time to transform. But we were also concerned that leading a traditional workplace into the digital age would not be an easy task.

Essentially, we turned to Salesforce to make our operations more efficient and connect better with our customers. We used Sales Cloud to monitor our KPIs and qualify leads and then customised it to automate processes for jobs and orders. None of this was achievable even a year ago.

It’s hard to be agile when your processes are paper-based, so the door to digital that we opened has led us to some pretty remarkable places.

How have you managed to get everyone on board this transformation?

DK: The sales team are flooring experts and they know their products inside out, but until recently, they weren’t familiar with all of the digital tools at their disposal. We used Trailhead to create learning paths that helped them understand CRM better – and this also led some teams to discover new features and efficiencies that we hadn’t set up in the initial implementation!

As a result of enabling the teams on CRM, our customer journey is also evolving. Previously, a customer might have had to deal with various points of contact to get their flooring done. Now with a single view of customers, products and projects, our salespeople are truly orchestrating the customer journey. In return, we can give our customers a more seamless experience and faster turnaround times. It really separates us from the rest of the competition.

What is next in KBAC’s digital transformation journey?

DK: We like to think of our brand as forward-thinking and innovative at its core – so this is just the tip of the iceberg! We want to make things even easier for both sales and customers by using CRM for invoicing. And when it comes to products, we are introducing more and more brands with a lower environmental impact to our customers. With responsible flooring options and even raised flooring made from up-cycled tyres, we aim to be a sustainability Trailblazer for the construction industry in South Africa.

Getting started with digital transformation

Though this may feel overwhelming, it’s important to remember that most businesses are still in different stages of the process and it doesn’t need to happen all at once. Though you may hear of fast transitions, that doesn’t necessarily mean the business is doing it in a strategic, effective or sustainable way.

The keys to successful digital transformation are:

• Having digital-savvy leaders.
• Building capabilities for a future workforce.
• Empowering employees to work in innovative ways.
• Giving administrative tools a digital upgrade.
• Keeping communication open between team members.

If you want to succeed with digital transformation, it’s important to keep these key areas in mind. Work on developing clear strategies for digital skills and capabilities for future needs, upgrade the organisation’s culture to adapt to changes, and ensure that communication is open and honest to keep everyone on the same page and board with the changes.