Creating a Winning Digital Transformation Strategy

Published Jan. 15, 2022, 2:57 a.m. by sdanquah@gmail.com

What is digital transformation and what does it really mean to a business? Digital transformation is the adoption of digital strategies in all or some areas of your business to create efficiencies in your business processes, reduce cost of business operations, create profitable customer engagement, and in some cases, find new sources of revenue.

Digital transformation is also about positioning enterprises and organizations to avoid being disrupted by aligning business objectives to evolving customer needs. New digital, mobile, and social media development have revolutionized how consumers shop and interact with brands . For small and medium size companies, digital transformation is about finding cost effective ways to engaging customers, retaining workforce, and adopting the right technology platforms, business applications, and management concepts to grow and scale the business.

But the adoption of digital transformation has not been that easy, even for some established companies. According to Everest Group, nearly 78% of enterprises fail to scale and sustain their digital transformation initiatives.

But why? Many large enterprises and organizations approach digital transformation as an IT project, designating the responsibility to the IT department. Digital transformation is not about IT transformation. It is a strategic initiative, one that must involve strategic management, and the leadership of an organization. It requires new mindset about the way we conduct business. Where do we want our business to be digitally two years, five years, or ten years from now?

 1. Understand the challenges and navigate through them

For Small and Medium Business (SMBs), the challenges to digital transformation is similar to that of the large enterprise, but large enterprises do not have the problems of the proliferation of many platforms and applications that promise quick fixes and patchwork of different technologies that have plagued Small and Medium-size Businesses over the last decade. Secondly, many SMEs lack the management and technical competencies to strategically align their digital transformation to long term organizational goals and objectives. Increasing cybersecurity threats pose a different kind of challenge to SMBs in their adoption of digital transformation. SMEs do not have the security workforce to protect their digital environment from cyberthreats.

Despite these problems, SMEs would still have to adopt and embrace digital solutions, if they are to stay relevant and grow their businesses. The benefits are too much to ignore. If COVID-19 has taught us anything, it is that, it is not enough for businesses to rely on legacy applications and old business practices. From Enterprisersproject.com , digital transformation is a survival issue and that an organization’s ability to adapt quickly to supply chain disruptions, time to market pressures, and rapidly changing customer expectations has become critical. I agree.

SMBs that want to take advantage of digital transformation while mitigating the risks and costs, should start with the creation of a winning digital strategy. They must align their strategic objectives to their digital strategy. That strategy must evolve around the following:

• Transforming customer & user experience

• Digitalizing business operations

• Improving workforce efficiency and productivity

• Leveraging customer and operational data

2. Create profitable customer relationships

Powerful new technologies, platforms, and evolving digital products & services are driving changes in consumer behavior and preferences. To keep pace with these changes, SMBs can no longer rely on old business models and legacy applications to engage the customer. Successful businesses share a passion for satisfying customer needs. They have embedded winning digital strategies into their marketing and sales operations, enabling them to capture and analyze data that gives them insight into consumers' behavior and preferences. For SMEs to transition to high growth firms, they must adopt digital strategies and tools that rivals those of the enterprise firms

SMEs can adopt powerful Customer Relationship Management (CRM) platforms, at a fraction of the cost of legacy applications, to reach and engage far more customers than enterprise firms could have reached in the past. The challenge though, is choosing the right CRM and having the expertise to leverage the powerful features of these platforms. It is not enough to have CRM. To really capture and engage the customer, SME’s must first align their business processes and strategies around the customer and must find ways to engage. This requires strategic planning and decision from the organization’s executives and management. This has been the missing piece in the SMEs quest to digitalizing the frontend of their business effectively.

3. Adopt Enterprise Resource Planning(ERP)

ERP is a business process management software or platform that integrates business processes across finance, human resources, procurement, distribution, and other departments. ERPs are used across many industries and service areas including higher education, hospitality, health care, financial services, and government. Each industry has its own variations of ERP features and properties.

ERP systems improve organizations efficiency and effectiveness in several ways. According to Microsoft, modern ERP are designed to drive optimal performance, accelerate operational impact, and ensure business continuity. Having a firm’s backend systems talking together and with each other create business environment that reduces operations cost, time to market, and bottlenecks in the organizations. It increases business efficiencies and gives organizations insightful data for strategic decision making.

But ERP implementations have not been perfect for many organizations and have stalled their digital transformation journey. There are many reasons for this.

• Selection of independent ERP software and platforms that are not well integrated with different data sources within the organization

• Lack of strategic management input into the decision, acquisition, and implementation of ERP

• Lack of vendor training after sales have resulted in organization, not reaping the benefits promised. In some cases, they have had to abandon the system altogether

• High costs of implementation.

• lack of communication and user input

There is good news. Today, there are ERP systems built on cloud platforms that integrate the business process and provides efficiencies. These ERPs are built on common data platforms. Each business processes (HR, finance, procurement, and others) operate from the same database. Such ERPs are built to adapt to your needs and grow with you, helping you proactively prepare for—and readily respond to—any operational disruption or market change . To get there, SMEs must first create a winning digital strategy.

4. Retain and engage your workforce

A winning digital strategy must involve a management strategy that aligns an organizations human resource to its digital strategy. Humans are the center of the digital transformation, and organizations looking to advance their strategic initiatives must engage and manage their human capital. HR digital transformations start from recruiting through onboarding to retirement. It involves creating career paths to engage and retain the best employees.

Today, there are talent shortages across industries. From the Society for Human Resource Management (SHRM), nearly 90 percent of 1,200 employer surveyed said they were struggling to fill open positions this summer, and 73 percent said they are seeing a decrease in applications for those hard-to-fill positions. COVID-19 has also complicated the workplace environment. It has also taught us that, for organizations to quickly respond to disruptions, It must transform to better handle sudden changes in the business environment. It must learn to tailgate leading organizations who are leveraging modern digital technology to gain insights into developing targeted training to maximize productivity, retention, and employee engagement.

5. Leverage data and data plaforms to gain insights.

According to David Rogers (The Digital Transformation Playbook) , digital technologies have changed our world in how we think about data, and that data, once expensive to obtain, difficult to store, and utilize in organizational silos are now cheaper and more available. Today, there are more sources of data collection points due to improvements in cloud technologies, and readily available storage facilities. But data means nothing in digital transformation  unless one can draw meaningful and timely insights from them. This is where data analytics, artificial Intelligence, and business intelligence become indispensable. They give deeper insight into customer and operational data, allowing organizations to make timely decisions on critical issues. To tap into these data sources and maximize their benefits, organizations must plan and execute a winning digital strategy that establishes key business and performance indicators.

Conclusion

There is no doubt that there are benefits to successful adoption of digital transformation. Early adopters have transformed their businesses and are reaping tremendous benefits. Data platforms, and cloud technologies have made digital technologies available at the fraction of the cost of legacy applications. SMEs can leverage these to automate, streamline, integrate, and innovate to scale and grow their business.

How can we help you

At Danquah Group, we work with SMEs around the world to digitally transform their businesses to become more efficient, reduce cost, find new source of revenue, and grow their business. We engage business leaders and executives to create winning digital strategy.

Danquah Group Transform is one place to tap into digital technologies to establish web presence, get advice and solutions to digitally transform your business.

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