How Has Digital Transformation Changed in the Past Year?
IT consultants like to talk about taking clients on a “digital transformation journey.” While that may sound like techno-speak, it’s actually highly descriptive of any digital transformation strategy.
Companies focus on a business activity to create a new digital tool which they can then leverage across the enterprise to cost-effectively improve their processes.
Data collected from the tool is used to not only evaluate and refine the tool, but further develop new business models and action plans that often have implications beyond the original scope of why the tool was implemented.
That’s why it’s a journey... because when you implement a digital transformation strategy, the data you collect isn’t the end-result, but a starting point to take next steps.
Digital transformation is always going to be a work in progress.
Just look at how digital transformation has changed just over the past year.
1. More Customer-Focused
Initially, a digital transformation was primarily focused on modernizing technology, under the assumption that better things get better results.
In 2019, the evolving emphasis is less on the technology, but what the technology is expected to achieve.
According to Brian Solis, principal at the Altimeter Group, “Competing for new market opportunities [is] paramount. More than half of the companies (51%) we surveyed reported that they are investing in growth opportunities in new markets, making it the leading driver for digital transformation efforts. Studying evolving customer behaviors and preferences rank second at 46%. The third leading driver is increased competitive pressure (41%).”
He goes on to say, “Customer experience will only continue to serve as a primary catalyst for digital acceleration and maturity.”
As senior writer for Customer Experience (CX) strategy Judith Aquino points out, “These are consequential times for executive leaders seeking to position their organizations to compete and thrive in a disruptive market [by deploying] customer experience trends that are shaping customer service in 2019 and beyond.”
Key to enhancing the customer experience through digital transformation is an omnichannel orientation.
2. Omnichannel Integration
Multi-channel marketing is old school. Current digital transformation thinking is omnichannel focused.
That means coordinating all your potential customer touch points—social media, website, email—to provide insights into customers and tailor optimal experiences.
Simply put, it means providing customers the means to easily and quickly reach a company on any platform to provide a seamless and consistent customer experience.
To do that requires a transformation of all a company’s digital services integrated into a holistic Customer Relationship Management (CRM) system.
As Dion Hincliffe points out at ZDNet, “The fragmented and piecemeal efforts at digital transformation of years' past are slowly becoming part of a portfolio of more integrated digital initiatives...there's little question that coordinated efforts across the enterprise to deliver on consistency, shared planning, economies of scale, and a common data model are key to moving faster and producing better results.”
Technology that enables this—and which is now at the forefront of any digital transformation strategy—encompasses related technologies of Internet of Things (IoT), artificial intelligence, digital assistants.
3. Talk of IoT
Continuing advancement of IoT is another source of both innovation and even more data collection.
For the past years, everyone has been talking about the potential of IoT, but building a comprehensive IoT infrastructure is still a gleam in everyone’s collective digital eye.
Sure, we’ve got lawn sprinklers that can turn themselves off based on automatic measurements of soil content. While that’s pretty cool, what will be really cool is once the sprinkler manufacturers have collected enough data on a regional basis that they can provide customers with recommendations for likely optimal planting conditions.
That’s just one example of how digital transformation starts the journey, not just providing a product, but a product that markedly improves the customer experience.
The past year has seen increasing discussion about the potential of IoT. We’re in the initial stages of realizing that potential.
4. AI and Machine Learning—Getting Smarter
Organizations have deployed AI and machine learning (ML)to improve their internal processes, in particular to make continuous improvement to their automated functions.
But over the last year, AI and machine learning are underpinning the growing adoption of Robotic Process Automation (RPA) to handle routine, highly structured repetitive manual tasks.
An RPA “bot” (short for robot) can capture and paste data, execute routine responses, open and respond to emails, and communicate with other systems to perform a variety of routine operations, including responding to queries from customers and vendors and fulfill basic requests.
Such digital assistants have actually been around for some time. But what is sometimes called RPA 2.0 provides the resilience, reliability and scalability for large organizations to implement with confidence and with minimum disruption.
Indeed, studies predict there will be more than four million bots doing basic office and administrative work by 2021. And according to Bhaskar S, marketing specialist at Digite, AI and ML are the key technologies now propelling digital transformation.
Where We’ll Be in Another Year
So where will the digital transformation journey take organizations a year from now?
Well, further down the road. But where the road takes us is continually redefined by where the data leads us and what the organization needs to accomplish.
As Kamalika Some writing about digital transformation in 2019 and beyond points out in Analytics Insight, “Many companies have begun their journey, and have started making changes in their strategies, on large digital programs in recent years adapting to AI initiatives and modern technologies. In most cases, it is just a humble beginning and a lot more needs to be achieved.”