What is Digital Transformation?
As a Digital Adoption and Transformation Strategist, I see a fair amount of confusion about the terms “Digitization” and “Digital Transformation.”
Here’s an overview of both terms to clarify expectations and define their roles in helping businesses thrive in a digital economy.
Why Digital Transformation:
“Digital transformation positions a company to take advantage of digital technologies to deliver new customer value propositions”
To thrive in a digital economy, businesses must set an intentional focus on the design and execution of their digital business strategy and transformation design approach.
These strategies must also be aligned with the overall business strategy to maximize the delivery of new customer value and business growth.
Digital Transformation and Digitization
Different than the term digitization, digital transformation is a more arduous journey that stretches beyond business strategy and impacts every aspect of the enterprise. Transformation requires designing the employee experience and the customer’s experience in tandem to achieve success.
In the digital transformation journey, businesses structure core elements and configure their people, processes, and technology to quickly take advantage of new capabilities and opportunities enabled by digital technology.
Digitization refers to the modernization of business processes through the implementation of new systems and applications. Digital transformation includes digitization with new systems and technologies but is more than just IT Architecture.
According to the MIT Center for Information Systems Research, digital transformation is defined as:
“The ongoing process of aligning the organizational structure, operating model, and digital business design to deliver new value propositions for customers.”
Digital transformation is enabled by digital technology such as:
- Artificial intelligence
- Machine learning
- Early technologies known as SMACIT (Social, Mobile, Analytics, Cloud, and Internet of Things).
Ultimately, the real digital transformation journey centers on developing standardized organizational processes, gathering customer demands, building digital platforms, and building accountability and ownership into the organizational structure.
Digital Business Design and Strategy
The digital business design governs how technologies are utilized to enable agility and innovation in response to new technologies. Digital business design involves holistically configuring people, processes, and technologies to deliver new offerings that take advantage of digital business capabilities.
As a caution, the decision-making process in a siloed company is often not well suited to the fast-moving nature of today’s digital environment. Businesses must adopt a digital business design that allows leaders to make decisions rapidly and align the business vision across departments and locations.
Successful digital transformation is a long, intense journey that requires a unique blend of business strategies, mindsets, and methodologies. These work together to fully take advantage of new and emerging digital technologies that can deliver new customer value and revenue.
Digital transformation is an organizational culture change that requires change management to be part of the business strategy to support the accountability framework, operational excellence in processes, and adoption of new ways to create customer value through technology.
I’m Dr. Keera Godfrey, and I’m the Founder and Principal Consultant of Naris Communications, a change management consultancy specializing in communications for digital adoption and culture transformation.
We help businesses prepare their employees for the behavior and culture shifts necessary for successful digitization and digital transformation. We take a human-centered approach to communications, education, and strategic engagements that align organizational leaders, project teams, and end-users at all levels of the business.
Naris Communications is a strategic partner with Whatfix, a digital adoption platform, and is committed to helping clients achieve a significant return on their investment in digitization and digital transformation.
Follow me on LinkedIn to learn more about how we can support your digital strategy and design. I’d be happy to have a conversation!