Digital transformation changes the way an organization operates. Systems, processes, workflow, and culture are all part of this process. This transformation affects each level of an organization and brings together data across areas to work together more effectively.
By taking advantage of workflow automation and advanced processing, such as artificial intelligence (AI) and machine learning (ML), companies can connect the dots on the customer journey in a way that wasn’t possible before.
8 Benefits of Digital Transformation
For many companies, the driver for digital transformation is cost-related. Moving data to a public, private, or hybrid cloud environment lowers operational costs. It frees up hardware and software costs while freeing up team members to work on other projects.
Enhanced data collection
Most businesses are collecting mountains of customer data, but the real benefit is optimizing this data for analysis that can drive the business forward. Digital transformation creates a system for gathering the right data and incorporating it fully for business intelligence at a higher level.
It creates a way that different functional units within an organization can translate raw data into insights across various touchpoints. By doing this, it produces a single view of the customer journey, operations, production, finance, and business opportunities.
It’s vital to evalute how that customer data is being collected, stored, analyzed, and shared as part of this process. When you’re rethinking your tech stack, you’ll want to ensure that sensitive data flowing into and out of your customer relationship management (CRM) software and other platforms is protected with a layer of SaaS data encryption.
As you evaluate the customer journey as part of your digital transformation, consider how you can give your clients greater autonomy over their own data — using data privacy as a business differentiator. Consumers are increasingly aware of, and concerned about, how their data is collected and used. Show them that you respect their data by putting strong privacy practices in place and giving them the opportunity to change their minds at any time.
Stronger resource management
Digital transformation consolidates information and resources into a suite of tools for business. Rather than dispersed software and databases, it consolidates company resources and reduces vendor overlap. The average number of applications used in enterprise businesses in 2020 is 900. Digital transformation can integrate applications, databases, and software into a central repository for business intelligence.
Digital transformation is not a department or functional unit. It encompasses every area of a business and can lead to process innovation and efficiency across units. From sales and marketing to finance and the C Suite, every department leverages sensitive data. It’s important to optimize and secure data everywhere it flows, while equipping teams with easy-to-use tools to get their jobs done.
Data-driven customer insights
Data can be the key to unlocking customer insights. By better understanding your customer and their needs, you can create a business strategy that is even more customer-centric. Using both structured data (personal customer information) and unstructured data, such as social media metrics, these insights can help drive business growth.
Data enables strategies to provide more relevant, personalized, and agile content.
A better customer experience
Consider how your digital transformation can not only unlock efficiencies for your teams, but also deliver more seamless, intuitive experiences for your customers. This spans from email communications to user portals, digital products, and even the cadence by which you reach out to new prospects.
Customers have high expectations for digital experiences. Consumers are used to having endless choices, low prices, and fast delivery. Customer experience (CX) is the new battleground for brands. Gartner reports that more than two-thirds of companies say they are competing mostly on customer experience.
Accenture reports that CX “has emerged as the key driver of sustainable business growth.” They suggest that even a single point increase in CX scores can results in millions of dollars in annual growth.
One way to differentiate your brand with customers is to demonstrate that you value their privacy. Give the customer control of how their data is collected and used, and empower them with the autonomy to make decisions around their data.
Encourages digital culture (with improved collaboration)
By providing team members with the right tools, tailored to their environment, digital transformation encourages a digital culture.
While these tools provide a more seamless way to collaborate, they also help to move the entire organization ahead digitally. This digital culture shift is crucial for businesses to remain sustainable. It forces the upskilling and digital learning of team members to take advantage of the benefits of digital transformation.
Companies that undergo digital transformation improve efficiency and profitability. Consider these results reported by the SAP Center for Business Insights and Oxford Economics:
- 80% of organizations that have completed digital transformation report increased profits.
- 85% say they have increased their market share.
- On average, leaders expect 23% higher revenue growth than competitors.
Digital transformation makes organizations more agile. Borrowing from the world of software development, businesses can increase their agility with digital transformation to improve speed-to-market and adopt Continuous Improvement (CI) strategies. This allows for faster innovation and adaptation while providing a pathway to improvement.
Having the right tech tools that work together can streamline workflow and improve productivity. By automating many manual tasks and integrating data throughout the organization, it empowers team members to work more efficiently.