The meaning of those two words is radically different depending on where an organization is aligned technologically, but no matter what the definitions, the overall result is the same.
It means change.
For some companies, it may be the actual systems they use everyday in business while for others, it may be an entirely new business model based on eCommerce or cloud-based storage. A common thread uncovered in a recent Microsoft survey of private businesses showed a majority of leaders felt that their current business model would need to be heavily modified within the next five years to continue to be relevant.
Other data from Microsoft suggests this could be linked directly to the companies themselves. The average age of the companies that make up the SMP 500 has dropped from the historical average of nearly 58 years to less than 15 and continues to fall. By their very nature, younger companies move to develop new paradigms more aggressively and are actively seeking new solutions to traditional industry problems through technology. At the same time, the connectivity of people via technology has never been better and these younger companies are able to hire highly skilled individuals from any market in the world to aggregate their business model. The result is free thinkers not bound by geography who have been exposed to innovative ideas.
Another key point of this is the move from “experience” to data. The successful company of today is able to clearly understand key data from their clients – not in terms of “good” or “bad” but in tangible metrics – 15%, 75%, “yes”, “no”.
Thus, new technology is implemented and acted upon in new companies and new industries far faster than at any time in history.
Digital Transformation is made more relevant when the sum of any company’s data can be stored securely in the Cloud and accessed easily from nearly any device. The infrastructure to make changes is now accessible to any size company and the cost of the technology to do so has plummeted – taking with it one of the largest traditional objections to enhancing company business models.
So what does 2017 hold for companies looking to transform?
For starters, companies of all sizes need to clearly understand the goals of any transformation. This starts with rethinking how the customer can interact with the organization – and is usually a very tough process for any company. Companies using a “design thinking” model use a solution focused, not problem focused, system to design the desirable solution for clients and is critical to understanding how the company can use technology in the next model.
The overall results for a digital transformation in any size company stems from the basic move to engage the entire culture in a digital model. Every aspect of the company – from Marketing, Finance, Sales, and Human Resources has to be engages in the transformation or the culture will never truly be in the digital age. It may be difficult to think of creative minds in a digital culture, but the result of doing so allows you to channel artisanal energies into the new model.
No matter the industry, the use of imbedded technology is nearly complete – the overall infrastructure has been built and now the next step is to change not the look of the company but the way business is actually approached. In many ways, the disruptions to come echo back to the first active use of computers in the 1980s and how they first impacted models.
Competitive businesses now, as they did then, will engage and seek to and build successful models based on a full inclusion of technology.