Scaling Your Business for Digital Transformation - 6 Important Factors
Each year brings a rapid increase in technological advancements that can benefit both your personal and professional life. Constant tech advancements can make it feel hard to keep up with competing businesses if your company isn't adapting fast enough. In this day and age, digital transformations are integral for a growing business's future, as technology changes the advancements and operations of every company. In fact, 40% of all business technology spending will go towards these changes, and, as of 2018, advanced analytics was the greatest form of digital investment, and there were plans to increase similar solution investments by 75% over the course of the next several months.
What is Digital Transformation?
While it can be assumed that a digital transformation involves the addition of new digital technologies, it can actually be so much more.
A digital transformation is the integration of digital technology into a business's current processes that fundamentally changes all areas of operation. This results in newer, more valuable ways to deliver to customers.
Technology plays a critical role in an organization's ability to increase value to customers and evolve within its industry. Digital transformations are often the result of new customer expectations from a business, which can push the company to make client-facing, as well as internal, digital changes.
Because these changes drastically impact existing internal and external business policies, it is imperative that cross-departmental collaboration occurs over an extended period of time. In order to pair growing business needs with rapid technological advances, a company needs to be comfortable with transparency and communication between various departments. This is the case with various AI functions, financial systems, and tech-driven customer experience business models that are becoming increasingly popular as cloud systems make their way into businesses.
A customized digital transformation can help a company reinvent itself and the way its business is conducted. This practice can help a company stay up-to-date with the times and better itself in many areas it was potentially lacking, such as with recruiting or internal communication.
It doesn't have to stop after implementation, either. The addition of emerging technology into a business should be a continuous practice to advance beyond a company's competitors.
6 Important Factors for Scaling for Digital Transformation
There are many ways a company can scale itself to complete the transformation. Each factor, important in its own right, can bring about various positive results. Let's take a look at 6 key factors for scaling your business for a digital transformation.
1) Budgeting for Digital Transformation
A great first step is to make sure the right structure is in place to actually partake in a digital transformation. While every business operates in a unique manner, it's important to have the structural means to be able to adopt digital technologies that will benefit the company.
This can be done by ensuring the financial capabilities of a transformation, as costs are important to consider, and preparing for these costs is necessary. It can be an expensive endeavor to perform a digital transformation, and there is generally no end goal so much as a constant state of change.
In fact, investments in technology are expected to total $6 trillion this year. The actual expense of a digital transformation is different for each business. The recommended amount to budget is around a 5% operating cost derived from the market and the individual organization. That being said, it can cost more to not embrace the emerging technology your business's competitors may be embracing.
2) Employee Training
Having an employee base that is willing and able to be trained on such technologies will make an easy transition to digitalization. Preparing a current employee-base through slow integrations and significant training well ahead of time can lead workers to feel sound in their usage of the technologies as they come. It may be found that more employees are needed to operate this technology, but providing ongoing training while attaining new technologies and software can attract new top talent to the company. If done correctly, a company can rapidly increase in size as it begins to beat out competitors with top talent and tech.
3) Picking the Right Technologies
Deciding which technologies to invest in is also imperative. Some companies rush into things and overload employees with too many major changes all at once.
A good rule of thumb is to take what you already have and improve upon it. Using your current procedures and analyzing your goals can help align technology with your current business ideals.
4) Focusing Your Digital Transformation Plan
Start with things you want to improve on as a company. If the goal is to improve customer experience, take advantage of technology that improves that aspect of your business. If you're looking for HR tools, find technology that makes recruiting easier and more efficient.
It may take some trial and error to figure out exactly what works for your company, but preparing these areas ahead of time can maximize efficiency when finding the technology that's right for you.
5) Preparing Your Company for its Digital Transformation
Determining whether your company is ready for a digital transformation can be as simple as wanting your company to grow. It doesn't necessarily mean core values will change, but just that the approach to the mission will occur more efficiently while also scaling for growth. Engaging in a digital transformation is a great way to gather the correct tools to accomplish this growth.
Because technological solutions automate processes for both employees and customers, growth can happen quickly internally and externally. But your company doesn't necessarily need to be tech-savvy to digitize your business. It does, however, need to embrace the idea of revolutionizing the company with a transformative mindset. By recognizing all areas of change and being willing to go to the next level of transparency to promote collaboration opportunities can signify that your company is ready to undergo a transformation.
6) The Role of Change Management
Employee engagement is a particularly important part of a digital transformation, as many aspects of an employee's day are subject to change. If employees don't accept the changes, engagement may suffer. Keeping employees engaged throughout a transformation timeline will ultimately set your business up for success through the transition.
Being transparent about what is happening and why will allow employees to prepare for changes they may not be comfortable with. Through the implementation period, it's important to continue practicing these methods of transparency to determine how employees are adapting to each of the changes.
The more employees who are engaged throughout the entire process, the easier it will be to implement. Increased, sufficient training, communication, and complete transparency are integral to the success of the internal side of a digital transformation.
No Two Transformations are Exactly Alike
Digital transformations are unique for every business. While it may seem like a company has to change everything to keep up with its competitors, that's not necessarily true. By evaluating your business against its competitors, key aspects can be identified that need to be changed.
There are many different tools a company can integrate to take part in this process, but ultimately it's up to the business and what it's comfortable with.
There is no set timeline for how long a transformation should take, as it is a continuous effort. However, initial changes will take longer as employees get used to new changes.
From artificial intelligence technology, to the cloud, there are endless options for what emerging technology a company can introduce to its business.