What are Digital Transformation benefits?
Adopting and adapting to digital is appreciated more than an afterthought in business today. To stay competitive and relevant, it’s crucial for companies to begin and progress their transition to digital transformation.
With digital disruptors snapping at the heels of many industries, success will come to the businesses that ensure their workforce is skilled in the best practices of the digital age. Moreover, this transformation must be weaved into every part of the company and championed by leadership to have maximum influence.
Many businesses may concern that they’ve already fallen behind. Probably some think they are too late to get started. But, is it true? In fact, digital speed is as much as 5 times faster than a traditional business, and that pace is essential to becoming a leader or a fast follower.
In this article, we are going to explore the digital transformation benefits to a business and its workforce.
Table of Contents
- Digital transformation benefits statistics
- Global digital transformation benefits report 2019
- Enterprise digital transformation benefits
Digital transformation benefits statistics
Below are some of the digital transformation benefits statistics you may want to know:
- Companies that earn $1 billion a year earn an additional $700 million over three years by investing in customer experience
- 56% of CEOs say digital improvements have led to increased revenue
- Digitally mature companies are 23% more profitable than their less mature peers
- More than 50% of digital transformation efforts fizzled completely in 2018
- 39% of outperforming companies have a fully integrated digital-physical strategy
- Digital-first companies are 64% more likely to achieve their business goals than their peers
- Just 19% of companies have a customer experience team that helps bridge gaps in the business
- Fewer than 30% of a company’s technology vendors are actively involved in their digital transformations
- Of the $1.3 trillion spent on digital transformation in 2018, an estimated $900 billion was wasted when initiatives didn’t meet their goals
- 70% of digital transformations fail, most often due to resistance from employees
- Digital transformation and a focus on customer experience can generate a 20-30% increase in customer satisfaction and economic gains of 20-50%
- Only 16% of employees in one survey said their company’s digital transformations have improved performance and are sustainable long term
- Companies with less than 100 employees are nearly three times more likely to say their digital transformation was a success than employees at companies with more than 50,000 employees
Global digital transformation benefits report 2019
Schneider Electric has released its Global Digital Transformation Benefits Report 2019, presenting evidence of the power of digitization across the spectrum of global industry, commerce, and the public sector. It focuses on four main key sectors of the economy — buildings, data centers, industry, and infrastructure.
The report reflects quantifiable business benefits derived from 230 customer projects the company completed in the last five years across 41 countries.
The core of the report is 12 key business benefits of digital transformation divided into three categories: capital expenditure (CapEx), operational expenditure (OpEx), as well as sustainability, speed, and performance.
The study shows that digitization of engineering processes, for instance, can save businesses and organizations an average of 35% in CapEx costs and time optimization. Furthermore, commissioning costs and assets of new systems can be reduced by an average of 29%.
The study also reveals that digitization, by harnessing IoT, can result in significant savings in Operational Expenditure – leading to step-change improvements in efficiency, reliability, safety, and sustainability. Businesses and organizations report an average savings of 24% in energy consumption, as a result of digitization.
A larger story comes out from this report about the power of digital transformation in management and automation: when businesses digitize both management and automation, the two work in concert to drive even greater value.
“Digital transformation is the only way of delivering consistency and efficiency across a company. Technologies such as the Internet of things (IoT), artificial intelligence and big data analytics are making companies more efficient and innovative, boosting their competitive advantage,” said Jean-Pascal Tricoire, Chairman and CEO of Schneider Electric.
Enterprise digital transformation benefits
The majority of companies are transferring towards the process of digitalization nowadays due to its benefits. Essentially, the proliferation of computer and mobile technologies is necessary for businesses that want to go digital. While some businesses are able to convert goods and services into digital form, some are still drowned in the implementation process challenges.
Overall, the digital transformation benefits outweigh the challenges. Thus, overcoming the challenges is paramount. In this article, we will show you 7 of the benefits of digital transformation.
Transforms Customer Experience
Nowadays, the world’s obsession with the latest technology, social media, and apps revolves around a desire for an easier life. People want valuable and cost-effective solutions to their problems. But above all, they want it fast.
The experience of customers is acknowledged as the heart of digital. Therefore, the primary focus of digital transformation is to use cutting-edge technology, top-notch solutions to improve customer experience.
Many companies realize and recognize this, with 92% of leaders developing mature digital transformation strategies, specifically to enhance the consumer experience.
According to McKinsey, good customer experience in the transformation process must include:
- Focus on designing and digitizing customer journeys
- Enhance speed and agility in insights
- Achieve customer adoption of digital customer journeys
- Develop agility in delivering customer journey transformations
Those companies which are at the forefront of the digital revolution will earn much more authority, trust, and respect from customers.
Drives data-based insights
One of the great digital transformation benefits is the ability to track metrics and analyze the data that is gained during digital marketing efforts. Moreover, using these insights allows companies to optimize their strategies and processes for even better results.
In businesses, there are two things that matter more than most – costs and revenue. We are able to make massive changes to these by integrating data-based insights into the company culture.
Using data-driven insights to understand customers and feeds into a business strategy can enable hyper-personalization, relevancy, real-time feedback, and agility. This involves businesses making use of both structured (personal customer information) and unstructured data (social media metrics) pulling together data from many sides of the business to help drive the transformation journey.
Data in decision-making is very important and businesses should not underestimate it. The road to a higher ROI will become much easier with the right leadership to encourage this attitude throughout an organization.
Encourages collaboration across departments
Many people fear change. The thought of the entire organization making a massive digital transformation can be a daunting prospect for a workforce from leadership to entry-level employees. All processes, strategies, the core structure, and company culture need to be addressed.
However, there is a big chance for unity throughout the workforce. To maximize the opportunities for a successful switch, there need to be strong connections.
With encouragement, the staff is able to break down age gaps and social divides to engage in conversation and learn together. At this point, solid leadership can improve the digital intelligence of the workforce.
The foundation for a smooth digital transformation is built upon digital compatibility. When all departments are connected, a strong company culture shapes, allowing a successful and confident transition.
Increases agility & innovation
In business, agility is the ability to continuously develop and enhance quickly, especially regarding digital processes.
This penchant for revolution is held in high regard by many industries. When it comes to digital transformation initiatives, 68% of companies rank agility among the top three considerations.
Dr. Brigit Koenig, CEO of German’s Allianz Health, summarized the state of business in the digital age, when she said, “It’s never over. There is always change and always more to do.”
The fast-growing and perpetual changing of the digital landscape leaves no time for businesses to rest on their laurels.
Even companies that are on top must be ready to adapt and innovate. There is always new competition, new tools, and new trends. The customer will need more, wanting something faster and better than before. Therefore, staying ready is crucial.
Updates skillsets & knowledge
Because new technology continues to go stratospheric, the need for these specialized skills will grow. The future of digital business is looking to be largely built upon the following skillsets:
- Artificial intelligence
- Augmented Reality
- Cloud Computing
- Machine Learning
- Data Exploration/Analytics
- Growth Hacking
According to the report by Altimeter, 31% of companies lack digital talent and experience among their workforce and leadership. Inhibited by fear of change, many companies think of digital transformation as a waste rather than a smart investment.
By braving the challenge to make the change, companies allow their staff to develop skills for the future, equipping their business with the in-house knowledge to sustain growth and a competitive edge in the digital age as well.
Fosters a digital culture
Central to this flexible and adaptable nature is appreciated as a main digital workplace. This will allow the workforce to remain productive and engaged in the shifting without feeling overloaded or disconnected from the process.
Having the technology in place is not enough. If a business is to succeed in the future, the organization must adopt and apply a company culture that embraces the change.
Considering that 60% of professionals don’t feel equipped for change, a company culture that immerses the workforce in a digital transformation environment is a significant advantage, helping them upskill for years ahead along with climbing up the ladder to become digital-savvy staffs.
Digital transformation allows this to happen by making an influence on leadership and driving culture from the top-down. 90% of large companies are expected to have a CDO in place by 2019. That is important.
Consolidates process and operations
Putting money aside, the greatest universal advantage that technology has given businesses is that it has made it easier and faster to connect with other people.
By shifting to digital, enterprises can stick more than just their workforce together, but also their entire architecture. This may include analytics, social media, and even project management interfaces.
This consolidation of the company processes and operations enables the business to connect with their target customers and satisfy their demands.
In conclusion, we must say the future of digital transformation is no longer a dot on the horizon. The pressing demand to implement it in the next few years can no longer be ignored – certainly not if the organization has any interest in success or profits. The digital age isn’t new, but it is far more different.
Choosing to remain on the outside was a liberty that many companies had over the past decade. We are in the midst of a digital Darwinism and it’s the businesses that fully embrace and invest in their digital transformation that will thrive.
In general, digital transformation benefits can not be denied, the gains they derive after the implementation supersede what had been anticipated.
It is recommended for all businesses to integrate new technologies into their everyday operation. While digital transformation may be a challenge for some enterprises in the short-term, the long-term business benefits are definitely significant.
If you are a small business owner, the digital transformation should be on the list of your strategies before you startup. This shifting will propel your business for an easy adaptation to future technological inventions.
In case you have any questions, do not hesitate, just comment below, our team will reply as soon as possible.