Nearly every adult on this planet has a mobile phone. Out of 7.5 billion of us, five billion have phones, over half of which are smartphones. This has happened since 2007, when the first iPhone came on the market. The digital revolution has been rapid and unrelenting – and for most businesses, it’s meant survive or die.
How have you fared?
According to the Pew Research Centre, if your business is based in a country with an advanced economy, digital transformation isn’t just a matter of aspirational policy; it’s the difference between life and death.
Approximately 76% of people living in the world’s 18 advanced economies, from South Korea to the United Kingdom, own a smartphone.
What does digital transformation mean for you?
Your digital transformation needs with vary depending on your business type. Are product or service based, business-to-business or dealing directly with customers?
A professional services firm could need an overhaul of an IT system for a or a new user-friendly website that loads within two seconds (think Amazon) and incorporates virtual reality if you’re in the retail sector. Just take a look at Irish jewellery business Chupi, which sells in more than 60 markets and is investing heavily in virtual reality to reach more customers around the world.
What will it do for your bottom line?
Firstly, a digital transformation can mean cutting costs. Research by the McKinsey consulting firm found that “as many as 45% of the activities individuals are paid to perform can be automated by adapting currently demonstrated technologies”.
Secondly, you can achieve far greater efficiency of time and capital. Take a look at Li & Fung, the Hong Kong-based supply chain manager for big EU and US brands, which has major e-commerce platforms. It developed a three-year digital strategy to best serve a marketplace where mobile apps were as important as bricks and mortars stores.
The result?
It reduced time from design to sample product by 50%. And its finance department reduced its month-end closing time by more than 30%, as well as increasing working capital efficiency by $200 million.
If digital transformation sounds both appealing and important to you, how do you successfully manage it in a marketplace where 70% of businesses fail to bring about technological change?
Know your why
Research by McKinsey found that by far the biggest reasons organisations seek to undergo a digital transformation is to change how their businesses operate. Fast fashion might be faux pas in the age of environmental awareness, but online clothing retailer Boohoo is thriving.
This business sought to be as user friendly as possible in the digital age, so it made it possible to shop with Boohoo via social
media platforms. Despite sales in the UK’s retail sector hitting an all-time low, Boohoo reported a 44% overall growth in Q4 2018.
Domino’s pizza had a similar result. It wanted its customers to be able to order food from whatever channel they choose, from Facebook messenger to Amazon Echo. Now 80% of Domino’s sales occur on digital channels and the food chain still dominates the likes of Pizza Hut and Papa John.
Don’t rebuild the wheel
When it comes to organisational change, communication is key. At NASA, one of its core values is constant communication. The same is true for digital transformation; if you want to keep your team on board bring them on board and continually communicate the goal and the ‘why’ behind it.
Power to the people
If you really want change to be successful, you need to do more than just tell your staff – you need to empower them. McKinsey broke down 21 steps to successful transformation into five categories. Of these, one included “empowering people to work in new ways” and another was “communicating frequently via traditional and digital methods”.
Giving employees a say on where digitisation could and should be adopted is win-win. When employees come up with their own ideas about where digital transformation might support the business, respondents are 1.4 times more likely to report success.
Keep it small
Success rates are higher in smaller organisations, but don’t worry if yours is a bigger outfit. Start with a single department and go from there. At organisations with less than 100 employees, respondents are 2.7 times more likely to report a successful digital transformation than those from organisations with more than 50,000 employees.
Millennials again
Millennials are people too and, because people are at the heart of any good business, this last key step is about people – again. When building your goal and your why, remember that remote working is a very attractive prospect for young professionals. They prefer flexibility to compensation.
Will your digital transformation support remote working and telecommute capabilities?
If you need help communicating digitally with your customers or staff, book our Digital Storytelling course this autumn by emailing margaret@cleareye.ie