Publication: The Economic Times
How digital transformation can help your business grow
Business growth happens when the business exploits frontier opportunities which, by definition, requires challenging the status-quo. Typical growth stories about business growth incorporate positive disruption in the business brought around by things like adopting a new management style, an innovation in product or services, a turnaround in marketing approach, a renewed focus on quality and so on. Most businesses would fall to the standard life cycle of growth, stagnation and decay. Internal and external factors—operational aspects, organizational culture, innovation, competition and consumer behavior changes—converge, typically, reinforcing this pattern. Digital transformation seeks to renew the business and set in a new growth phase before stagnation sets in.
Information technology has been the backbone of business operations for a long time. The hype surrounding “digital” often ignores the distinction between mere digitization (or IT enablement) and digital transformation. Make no mistake though, businesses in this era are largely dependent on using digital technologies—even if it only entails running the traditional processes better. Digital transformation is about finding new ways to really change the traditional processes of the business in a manner that brings about a positive shift in the business model itself.
This would mean digital transformation is not just about replicating the traditional process into a digital pipeline and making it work faster. It is more than just automating the typical tasks which can be handled by software. Rather, it is to find innovative and empowering methods to conduct business activities which were not possible earlier. Growth thus can come from business model changes which could mean new ways of gaining and serving customers, newer ways of monetizing the value delivered, and most importantly newer and better ways of creating value for the stakeholders.
B2B can take notes from B2C
There are many great examples of how businesses adopted digital transformation early on and left their competition behind. The well-known example of that is Netflix. It completely befuddled their largest competitor at the time, Blockbuster video, whose CEO even quipped that he doesn’t understand what’s special about Netflix while they offered the exact same set of services. The difference was digital transformation. We all know who survived out of the two. The same applies to all B2B businesses today. Although the pace of change is a little slower in this segment, some frontier companies who have embraced digital transformation have shown enough impact on their growth that others are quickly following suit. Look at Sandvik, a 160-year-old Swedish conglomerate with core sector interests in mining and construction equipment. Since the economic recession of 2008 they have become increasingly focused on software technologies. So much so that their 2021 annualized sales from digital offerings was about $305 Million. Sandvik has been posting double digit growth and much has to do with their strategic investments in digital technologies.
Digitization vs value delivery transformation
All businesses are becoming IT businesses and that is the truth. Much of the need for doing so is because every business has begun understanding the value of data and connectivity. Older generation software implementations for ERP and CRM were more focused on getting the existing data and processes digitalized. However, with the advent of distributed workforces, hybrid work cultures, more data driven decision making and the need to make the businesses customer-centric, digital transformation needs to map the entire customer journey.
There are many dimensions of value delivery. It could be functional, economical or emotional. While choosing the digital transformation solution, it is necessary that the right dimensions and their success factors are mapped according to the user’s expectations. For example, in the case of customers, growth will come from increased value by simplifying interactions, generating insights and utilizing those insights to customize your services.
Mapping the value delivery journey
The implementation should begin with identification of the value receivers and value drivers, both inside and outside the organization. Once they are mapped alongside the business processes, the organization needs to find touchpoints to apply digital interventions. Digital transformation challenges need to be discovered while working on the identification of value delivery, organizational elements and digital opportunities in terms of solution implementation.
Any business looking to adopt digital transformation or wants to shift from legacy systems to modern workflows should think about the value delivery they want to achieve. Organizations need to have a more inclusive approach behind their digital transformation goals than just addressing the pain points. Today, with enterprise software technologies, it is possible to map all your business needs and customize a solution which takes care of almost every challenge you can think of, but the true success of digital transformation will depend on the ability to look beyond and implement systems which will address future challenges. That’s the way to get ahead of the industry standard.
Transform the customer experience not just the interaction
The new decade of business growth will depend on how well the organization understands its customers and delivers the kind of experience which is not offered by others. There is a huge service orientation involved in building that trust. Whether being a B2B manufacturing company or a project services company, it is still serving the end user. The company needs to have the right insights into the user experience to drive demand for the products and services. Thus, the systems used by the company to track utilization should incorporate not just the interaction with the customer but the experience of the users to constantly improve the products and services.
A good example I can give is of a leading American asphalt and concrete company for which Advaiya implemented multiple, but integrated, digital solutions transforming aspects of operations, employee interface and field services. For instance, the company, after implementing Microsoft Dynamics 365 and SharePoint based systems, was able to simplify the work life cycle allowing for not just more productivity, but also better customer experience and newer engagement types leading to growth even with pandemic caused head winds. By moving their data to the cloud and integrating with mobile apps, they completely changed the way data was accessed. They have transformed their customer experience with much more efficient work order generation, billing and incident reporting.
The pandemic caused a major disruption in supply chains and workforce behaviors. Companies were compelled to think of their business differently to manage resources and productivity. People would have different opinions about digital transformation but to me it is the need to innovate business practices to ensure survival and growth. The companies adopting these technologies should take that as a thumb rule.
(The writer is Founder & CEO at Advaiya)