While the pandemic has accelerated digital transformation efforts, research from Deloitte shows that 70% of these types of initiatives fail. This failure can be attributed to underestimating the processes and complexity of digital transformation, lacking guidance and ownership from the top and not knowing how to implement various facets of this journey.
To successfully transform a digital tool into an advantage for a business, you need to possess a digital capability to use technology to improve essential parts of your business. Then, you require a leadership ability to form and compel change in the organization in a streamlined and profitable manner. Lastly, you also need to appreciate that your company can continue to experience barriers in its efforts to change without knowing and understanding the three key elements of digital transformation. So, here are those central elements of that transformation journey that you need to focus on.
While a digital adoption platform (DAP) can assist your company in leveraging technology to help it change, it is not enough. You also need to ensure that the drive for digital transformation also involves continually considering the voice of employees every step of the way. A recent study demonstrated that gaps in talent or skill sets were the main barriers to a successful digital transformation. As this research indicates that employees can inhibit transformation success, you can improve your EX by considering how technology accelerates employee productivity and performance. While technology such as this could assist people in working faster, smarter, and more safely, your business would also need to consider how these tools can change specific job roles and how they could emotionally support employees experiencing these shifts.
Then, to get your employees ready for a digital future, you need to equip them with the mindsets and capabilities needed to embrace digital technology and drive a smooth business transformation. For example, to augment its digital offerings, insurance company Munich Re listened to its employees first and then built internal digital platforms around their needs, which they could use to create innovative new solutions. This digital platform called Excite consists of a shared database of software components that could be used by employees looking to develop new digital initiatives. In addition to creating this platform, Munich Re also simplified its funding process for these initiatives to encourage employees to use this technology.
Employees could start by applying for a smaller budget if they answered five questions. Then, if their project met its requisite goals, it could become eligible for further funding. This digital effort produced Munich’s Re’s partnership with Google to provide cyber insurance for its cloud.
Businesses also still need to focus on improving CX but focus more on design, crafting an emotional connection and developing an intelligence repository. To create a compelling CX, your company needs to start by designing an ideal experience for human behaviours using tools like customer personas, journey mapping and design thinking practices. The customer insights sourced from these tools can then digitally steer CX in the right direction through front-office technologies and back-office infrastructure for a sustained service experience.
Additionally, machine learning and other types of AI can help your business develop a real-time intelligence machine capable of creating proactive, personalized interactions with customers. For example, Lookiero, an online styling service which puts together a personalized collection of clothes and accessories for a shopper, improves its future styling selection patterns by using technology to analyze initial survey data from customers and then concurrent evidence of what they return.
These personalized initiatives can also create memorable experiences which can help a brand emotionally connect with a customer. A previous study from Capgemini supports this idea as 70% of individuals who have become emotionally attached to a brand buy twice as much from them.
The advancements in cloud computing, sensors and IoT have allowed companies to make their back office capabilities more efficient and develop unique business models that their competitors cannot steal. For instance, Australian mining company Rio Tinto uses technology to advance core processes automation. It does this by deploying autonomous trains, trucks and drilling machinery so that workers can engage in less dangerous tasks, which thereby improves safety and productivity.
Furthermore, brands can also use technology like digital threads, connecting machines and models to provide one single source of analytics or intelligence, making it easier to manage, enhance and optimize maintenance processes. Then, use technology to create a data-driven platform. A digital platform can be made up of three different elements:
- A core foundation for the company’s critical operational and transactional processes.
- An agile external element that works together with the core element of the platform to power customer-facing experimentation and personalized experiences.
- A data-focused part gives the business the ability to perform analytics and test algorithms without interfering with the core element of the platform.
To identify underserved segments where it failed to get a market share, Telkomsel started its digital transformation journey by adding and building a data analytics platform to its existing business to firstly understand all its customers better. Then, using the intelligence gained from this newly built platform, they hoped to create new businesses like its by.U initiative to better serve customers they were not currently targeting. The final leg of their transformative effort involved creating digital channels to target and attract customers by giving them what they want.
Using this process, it discovered that its current underserved market was the Gen Z audience. So, after extensive customer research, it created by.U, an end-to-end digital internet SIM card which gives this audience the ability to choose the basic data quota, topping quota and create their number for their plan. In other words, Telkomsel found a way to digitally improve its existing business model without requiring a lot of change to the current business.
Based on the intelligence that its data platform generated, it was also able to quickly fine-tune its minimum viable product (MVP) through several social media tests. This process allowed by.U to reach two million subscribers in just 15 months after launching. It also used a cross-functional team of individuals with broad expertise and different perspectives who worked together in an agile manner toward solving a customer’s pain point.
The world has changed a lot in the last few years, so adapting your business to the associated digital transformation changes cannot be achieved quickly. Fortunately, companies can start this change by getting their workforce future-ready to be empowered to design and deliver memorable experiences for customers. Lastly, your brand can use technology to streamline its operations to continue to put its employees and customers first in this transformative effort.
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