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The What, When, Why, and How of Digital Transformation

It matters not what your business does, in what industry it operates, or what its vision is for the future. If your plans don’t include digital transformation, you’re as good as gone. Like most things in technology, there seems to be a lot of confusion and, frankly, delusion about what digital transformation actually is. To help you better grasp the subject and understand the gravity of this make-or-break evolution, here’s a quick and easy breakdown:

WHAT is digital transformation?

Digital transformation is the process of strategically infusing business functions and operations with digital technology to optimize performance, enhance experiences, and leverage data. The goal of digital transformation isn't to recreate existing functions in digital form, but to transform those functions into something new and more powerful.

Digital transformation is not a destination; it’s a state of being.


Common Digital Transformation Technologies

  • Cloud Computing
  • Internet of Things
  • Software-as-a-Service
  • Artificial Intelligence
  • Data Science


Examples of Digital Transformation

  • GE transformed their traditional manufacturing process into “additive manufacturing” by adopting 3D printing technology and re-imagining workflows. As a result, they consolidated the development of 19 parts down to a single print job.
  • Cisco developed a virtual Manufacturing Execution System (MES) to gain real-time visibility into their supply chain quality.
  • Trelleborg used automation technology to change the way their collaborative robots are controlled. Now, one person can manage up to eight machines versus only three.
  • CEMEX, a building materials supplier, invented Smart SiloTM, which uses digital sensors installed in the customer’s silos to track material consumption. The sensors relay information back to the company, who dispatches product delivery as soon as inventory levels are low, resulting in a seamless, continual supply of materials for the customer.


WHY is digital transformation significant?

For the Business

Industry trends and consumer expectations change constantly, and your business must be able to seamlessly adapt to those changes while sustaining product and service quality and value. Through digital transformation, companies will:

  • Optimize business processes using automation technology
  • Make informed, accurate decisions based on a history of data
  • Use data science to predict the future
  • Develop new digital streams of revenue
  • Remain competitive in the market

For the Customer

Technology has turned the general public into on-demand consumers. We don’t just appreciate instant gratification, we expect it as a part of the customer experience. Through digital transformation, businesses will:

  • Leverage data analytics to improve their understanding of the customer
  • Design digitized customer journeys that contribute to an exceptional experience
  • Use mobile devices and predictive marketing tools to accelerate top-line growth
  • Digitize touch points between the company and customers to provide a highly accessible, multi-channel customer support experience.


For the Employee

Employers will forever chase higher levels of productivity. Digital transformation will move business functions away from manual processes and toward automation, which will enable employees to work better, faster, and smarter. Through digital transformation, employees will be empowered to:

  • Engage with customers in new ways
  • Streamline responsibilities to increase focus in other areas
  • Manage performance using deep insights
  • Eliminate siloed business processes
  • Collaborate with all departments across the organization



WHEN should businesses start to transition?

With the tick-tock of every passing minute, the U.S. generates roughly 2,657,700 gigabytes of Internet data. Early adopters of digital transformation are using this data to make massive strides forward. Slow adopters are falling further behind.

69% of CFOs and senior financial executives are already planning to increase their investments in

digital technologies that speed business change this year.


The value of digital transformation could reach $100 trillion by 2025.

In other words, you should start your digital transformation initiatives immediately!


HOW to plan for digital transformation

The process of digitally transforming is difficult and ongoing. New technologies are almost always met with resistance to change. However, the formula for success is simple:

Mindset + People + Process + Tools = Digital Transformation

  • Mindset: Start with your core mission — not technology — and think about the value you are trying to deliver. Accept that digital transformation will dramatically impact every area of your operation and commit wholeheartedly to the cause. Employees will either need to get on board or get out of the way.

  • People: Digital transformation is impossible without buy-in from stakeholders, senior leadership, and the workforce at large. Your Chief Information Officer (CIO) and Chief Digital Officer (CDO) will work hand-in-hand to lead initiatives. You also need an advocate on the board of trustees who truly understand digital transformation. Additionally, you should look inside and outside of your talent pool for individuals that can help drive progress.

    Note: If your organization lacks experienced data people, now is the time to hire a data scientist or train existing staff members. Your ability to aggregate, organize, and make sense of data is the lynchpin of your entire digital transformation strategy.

    Click here to learn more about Data Science Certification programs.

  • Process: Start on the outside and work your way in. The best place to begin is with the customer or user experience. Set short-term goals. Choose a single problem and see it through from start to finish before moving on to the next. If you aren’t trying to revolutionize a solution or process, someone else is. Fundamentally rethink your business models and processes, partner with third-party experts if needed, and go big. Get comfortable with experimentation; your organization will undoubtedly test different ideas before it experiences the Eureka effect and finds Ah-Ha! solutions.

  • Tools: There is a tool for virtually any business need. Find them and use them. Go cloud-based to increase efficiency and support collaboration and scalability. Focus on modular tools and integration. Develop a dashboard that tracks and monitors progress and impact and make this dashboard available to your entire workforce. At the root of every decision you make, confirm that the choice is sustainable.


If this sounds overwhelming, take a deep breath. We aren’t suggesting that you go "Japan Society 5.0". But we are dead-serious about the importance of integrating technology into your processes and activities to reinvent the way your business operates. A vital part of your digital transformation strategy will be expanding the skills of your workforce and training employees on data-informed thinking.


Eric Wise