Digital Transformation has become a reality and is now part of our everyday life, whether we work in private organizations, public sector, manufacture, services, or healthcare. Embracing it is crucial for businesses to remain relevant, meet evolving customer expectations, and stay ahead of the competition.
Digital Transformation is more than just software; there’s more to it than using buzzwords such as “machine learning” or “artificial intelligence”. In my opinion, Digital Transformation is a mindset that leverages technology and digital tools with business needs, focused on optimising existing processes and procedures, elevating people’s knowledge, enhancing customer experience and, ultimately, delivering value to stakeholders.
Instead of trying to define what Digital Transformation is, let us first discuss where it all started and where it is going.
The widespread adoption of computers in the mid-20th century laid the foundations of digitalization. Computers became affordable and available to many users. Then, the invention of the internet and the World Wide Web created the ideal user-friendly platform for accessing and navigating through information. Knowledge became accessible and widespread.
The e-commerce was born; the monetization of the digital world came with a bang! The 2000s saw the rise of mobile devices and tablets. These hardware technologies, together with high-speed networks, further improved the level of connectivity and mobility.
More recently, cloud computing closed the gap in data storage, allowed the invention of computer power on demand and, perhaps more importantly, it gave the means to easily scale and deploy new tools/software by eliminating the need for extensive physical infrastructure.
Finally, big data and data analytics emerged naturally given the copious amount of data available and almost unlimited computational power. This is the piece of the puzzle that has the potential to create the most value and insights to organizations. The ability to correlate data using complex algorithms, taking advantage of statistics and historical data, also drove the rise of Machine Learning and Artificial Intelligence.
And this is the world today: organisations can harvest new business opportunities, personalize user-experience, improve decision making and explore the world of descriptive, predictive and prescriptive analytics.
Digital Transformation brings many benefits to organisations and employees who decide to embrace it. It has the potential to increase efficiencies, improve productivity, reduce costs, improve customer experience and elevate knowledge. Could a new hire deliver at the level of a high performing professional? Yes, if the know-how is systematized and readily available in an easy-to-use tool that prescribes actions to mitigate a given challenge before it happens. This is already happening.
Inaction may lead to loss of market share, decrease in profitability, reduction of customer satisfaction and, in the worst possible case, obsolescence.
The final question in my mind is very practical: where to start? Just navigating through the maze of the digitalization’s nomenclature presents itself as a challenge. My advice is to start small. Define a simple, yet impactful, proposition for a digital-based change in your organisation. Collect feedback and bring stakeholders to the cause by identifying and delivering tangible value. This approach allows for controlled testing of digital transformation concepts and provides tangible results that can help build confidence and support from others. It also helps to address concerns about potential disruptions or high implementation costs. Additionally, engaging with employees at all levels and involving them in the process creates a sense of ownership and commitment.
Starting small does not mean you cannot be ambitious. The ambition should drive towards solving impactful problems. In fact, the motto that is often discussed in my team is to “think big, start small, scale fast”. Scalability is all about speed and easiness to deliver value across the business.
These starting projects have another function: pulse-check your organisation on its maturity and digitalization readiness.
First, data is needed, either through increasing the number of sensors on a production line for manufacturing, or by gathering information on your customers and supply chain for service-based businesses. Second, a functional data governance strategy must be implemented: if data is hard to access and maintain, then you are off to a bad start. Third, train users, train yourself, discuss ideas with co-workers and top management – everyone needs be on board. In addition, consider having in the team data scientists or engineers with fundamental knowledge - or a keen interest - on data science.
Digital Transformation is not an endpoint, it is an ongoing journey that requires planning, commitment, resources, and the right mindset. Remember, it's crucial to tailor the Digital Transformation approach to the specific needs and priorities of your organization and its stakeholders. Effective communication, compelling evidence, and a well-structured plan can greatly increase your chances of convincing others to embark on the digital transformation journey, and allow you to become an agent of change in the ever-challenging world we live in.
Article by Paulo Gomes, co-director of the Postgraduate programme in Digital Transformation