Digital Transformation in Management

What is digital transformation in management?

Digital transformation refers to the process of using digital technologies to improve the existing business methods, consumer experiences, and overall culture of the business. This is undertaken to meet the changing market demands and business environment. This new transformation of the business is known as digital transformation. It goes beyond conventional business management methods such as sales, customer service, and marketing. Digital transformation is important for all business organizations. In simple words, digital transformation is the new cultural change that requires the organization to change persistently and get itself comfortable with new challenges and opportunities.

Importance of digital transformation

To maintain the competitiveness of the business in the changing technological landscape, digital transformation has become very important for business organizations. In recent times the business environment has seen rapid change with more business organizations adopting digital technologies to improve the efficiency of their operations and improve their triple bottom line. The organizations that can implement the new technologies, and restore the traditions will be considered the winner. Some of the  major factors that make digital transformation important are

• The expectations of consumers have evolved with the emergence of digital technologies. Today customers want businesses to provide seamless experiences to them across different channels. 
• The efficiency of the business has also improved with the development of new technologies.  TAS the new technologies are making things automated, this has resulted in increased productivity and reduction in errors. For instance, the adoption of cloud technologies helps employees access data and collaborate with others around the world. 
• Making use of new technologies such as artificial intelligence, machine learning, Big Data, and IoT helps businesses in gaining a competitive advantage. This helps the businesses gain insights regarding the decision-making process of the customers, and their behaviors and allows the businesses to streamline their operations as per requirements. 
• One of the major roles played by digital transformation is that it has helped the business in reducing costs. The digital system has reduced the requirements for the human workforce along with increasing efficiency at the same time. This has contributed to saving costs for businesses. The adaptation of cloud storage has resulted in reducing the cost of hardware and physical storage for businesses. 
• Digital transformation has also improved the security of businesses across various domains. This has helped the business in protecting its critical and sensitive data from cyber threats and reduces the chances of data breaches. 
• Digital transformation also helps in improving the agility of the business and making it more adaptable. Businesses can change as per the changing market demands and constantly changing requirements of the customers. This provides the business a competitive advantage over the other business organizations that are slow towards the adaptation of new technologies. 

Methods for harnessing digital transformation in business

Setting up goals is very important for the digital transformation of the business organization.  There are various types of ways in which digital technologies can transform business organizations. Digital technologies help in improving the efficiency of various departments of the organization. Digital technologies can automate all the financial operations of the business starting from contact, and expansion to invoicing activity, providing the business with the opportunity to save time and money. The implementation of digital technologies helps make project management very easy by monitoring current projects and upcoming future projects. Also when the key processes of the business are automated it helps in the early detection of errors in the processes. For instance, digital technologies such as spreadsheets, have helped businesses store finance, and improve staff performance, and sales data. Technology has helped to maximize the efficiency of the teams by enabling the employee to work from their homes. Cloud storage, app integrations, and inexpensive storage rates have made remote working possible. 

Digital transformation is more than increasing the speed of operations and making them more efficient. Digital transformation has helped businesses to collect and interpret consumer data, which helps in gathering critical insights regarding the target customers, re-engaging the existing customers and advertising products and services to people with the same interests. Therefore marketing strategies have evolved dramatically with the inclusion of digital technologies. Digital technologies help in the decision-making process. Also, the implementation of digital technologies improves the innovation and risk-taking ability of the business organization.  After reviewing the performance of the business the leaders can make use of autonomy to make decisions, learn from their mistakes and adapt to new technologies. 

Digital transformation has helped in the identification of various opportunities that are required for the growth of the business. In simple words, digital transformation helps in causing disruptions. The innovation power of the business is sourced from new technologies. Therefore, the businesses can plan to create a new business model to target the untapped markets along with increasing the customer base of the business. Some other ways in which business organizations can harness digital technologies for making a human enterprise are

• Various predictions state that digital technologies such as ML and AI can place human jobs.  However, when implemented carefully, AI can change the nature of work and reduce monotony to improve efficiency. For instance, EY can automate tasks that are repetitive so that they can focus more on other important tasks resulting in catering long-term value. Today a new application EY document intelligence has reduced the time required in analyzing the contracts. 
• Geographical limitations make it difficult to collaborate the teams, even with the development of technology, Collaboration is a complex process as it comprises team members, partners,  and vendors from different parts of the world. This creates a major challenge for the international businesses.  It is also a challenge for EY. The company employs around 28400 people in more than 150 countries, facilitating better collaboration. Therefore, the company can make use of new technologies as 80 per cent of their services make use of cloud services.
• Digital technologies can also be harnessed by making the workplace of the businesses more inclusive. This is due to the reason that the more diverse and productive the more they can bring positive changes in the organization. Although there is more diversity in the technological field, the change is required to be addressed. Also, technological innovations do not show any signs of slowing down. Therefore, business organizations will continue to face the pressure to make use of new technologies. 

Organizational that has undergone digital transformation 

To improve sustainability in today's industrial era, organizations around the world are undergoing digital transformation and leveraging innovative technologies to gain access. Some of the major organizations that have undergone digital transformation and gained success in the world are

• Porsche, known for its high-quality cars, has been transforming its business operations by using digital technologies. This ranges from R&D to the development of new software that helps in getting feedback from the customers. To foster innovation, the company has launched the Porsche Consulting Innovation Lab. This department consists of software experts and technology. The company makes use of Big Data, machine learning, IoT and blockchain technology to achieve the required operational agility. 
• StarBucks also achieved a significant result by implementing Deep Brew, and AI-based applications. The application helps in selecting the best locations and also helps in analyzing data regarding the competitors, population, traffic, and income level potential of the location.  After collecting all the information and analyzing it, the AI tools forecast the economic performance, revenue, and profits. Due to the use of large amounts of Big Data, the organization can increase its sales by optimizing the menu. Also, the company provides a loyalty program for its customers to get detailed information from its clients. 
• Unilever also faced challenges in adapting to digital technologies. Although its commitment to software development, the company has been successful in achieving its aims and objectives. In the production process, the company started making use of digital technologies to achieve its aims and objectives. With the assistance of data analytics, and predictive analytics the company can predict demand estimates and plan the production level. 
• IKEA is one the best examples that showcases how traditional companies changed due to digital transformation. The company excels in providing customer-centric shopping experiences and strengthening its position in the e-commerce sector. The company also provides customers with facilities such as augmented reality to select their furniture when purchasing virtually.  In the year 2017, the company acquired TaskRabbit, to recruit people that will help the customers to find furniture. 
• LEGO has also gone under digital transformation in recent times. The company has invested a large amount of money in mobile games and applications.  The organization also provides 3D printing services that help the customers to design their products. The company is also working in the block department to help it add sophisticated sensors and elements. 
• Nike also launched an App known as SNKRS, which provides shoes to the customers and increases the interaction of the businesses with the consumers. The company is also known for making use of analytics on a large scale. By leveraging its digital ecosystems, the company can count the interaction that helps in tailoring messages and products efficiently. The company also gained popularity as it was able to handle the impact of the Global COVID-19 pandemic in a way much better than any other organization in the industry. It was also regarded as the greatest move towards the e-commerce platforms. 
• McDonald's introduced a program known as the Velocity Growth program that helps the company transform from analog to digital. The organization also created a Tech Lab in Silicon Valley, in which a group of data engineers and data scientists work in collaboration to create the technology infrastructure, to help the organization gain operational agility. 
• Walmart is one of the most successful companies, and this has been achieved due to its relentless commitment towards digital technologies. The company has employed autonomous robots that provide on-time delivery of the inventory. Due to this, the company has seen significant growth. As per the reports published by the marketers, the company surpasses eBay in the number of US e-commerce sales.