Digital transformation refers to implementing cutting-edge technologies across all business operations. It offers a suite of advantages, like delivering better customer experiences, improving employee productivity, and, most importantly, reducing operational costs.
However, as is the case with any emerging trend, there was a lot of ambiguity surrounding using digital transformation to reduce operational costs; it seemed too good to be true.
But after conducting in-depth research and trying digital transformation hands-on, we finally have the answer to our question. Since it can’t be explained in a single sentence, you’ll have to read this blog until the end.
Digital Transformation – A Brief Introduction
Before we move forward, it’s essential to get your concepts right. We’re hoping some of you are already aware of digital transformation. And if you aren’t, here’s a brief intro:
“Digital transformation is the process of leveraging technologies to improve a business’s overall operations and deliver better customer value.”
Owing to the incredible benefits, many companies have already shifted to digital transformation. And the rest are currently in the process of doing it or weighing the option.
That’s the reason experts project the digital transformation market size to grow almost 20% annually. So, if you haven’t opened up to the idea, now might be a good time.
Cost Reduction Through Digital Transformation
As we already mentioned, digital transformation produces numerous benefits for businesses. However, reducing operational costs is the one they look forward to the most.
It’s important to understand that it doesn’t happen directly; instead, digital transformation contributes to cost reduction by generating an impact on the following aspects of an organization:
Automated Processes – One of the significant benefits of digital transformation is that it automates repetitive and manual tasks. Let’s take a look at the example of onboarding an employee. Typically, the process involves gathering relevant details, conducting training sessions, assigning supervisors, and plenty of others. Automating this would mean doing all the same work without the hassle and expenses.
Paperless Operations – Consider the previous example again. The collection of data and arranging training sessions entail using a large number of papers. However, when you follow a digital approach, the papers are replaced by electronic documents. That, in turn, saves the expenses of purchasing, printing, and distributing paper. Moreover, this reduces your carbon footprint, a significant concern for business owners.
Better Customer Experience – Customers expect immediate responses from companies when they ask a question. As important as it is, sometimes, you’re in no position to answer promptly. But that’s not a good enough reason for consumers to stick around. That’s where digital transformation can help you. It allows you to respond in a timely manner without spending money on hiring customer support representatives.
Remote Working – Post Covid-19, many companies have shifted to a hybrid working model; employees follow a balance of in-house and remote working days. Adopting this approach would’ve been challenging if it weren’t for digital transformation. In addition to supporting your staff, remote working saves your money on expenses such as utility bills, office supplies, and transportation costs (if your company provides it).
Research-Backed Insights – From hiring competent employees to finding the right vendors, being a business owner means making critical decisions. And in many cases, making the wrong choice could yield unfavorable results. Digital transformation prevents that from happening by providing real-time data and useful insights. It also helps reduce the chances of making costly decisions, both monetary and non-monetary.
Why Small Businesses Need Digital Transformation
Until now, if you were under the impression that the impact of digital transformation is only on large enterprises, prepare to see things in a different light. It’s advantageous for every company, regardless of how much market share it has captured.
That said, the move to digital transformation for small companies will be tricky, considering their limited resources. In fact, you can expect numerous challenges along the way, such as:
The Need for Digital Transformation
After hearing almost everyone around you talk about digital transformation, you might be inclined toward using it. However, it’s not the time to make hasty decisions. Instead, consider everything thoroughly, starting with whether your business needs digital transformation at all. For instance, if you don’t have the budget, it’s better to focus on generating enough revenue to support the transition.
The Lack of the Right Strategy
According to research, 70% of digital transformations fail. Why that happens warrants an entire article, but a significant reason is jumping on the bandwagon without having the right strategy. As we’ve explained in the blog, every company hopes to achieve different outcomes by incorporating digital transformation in their operations. That’s why you must set clearly defined goals to make the most of it.
The Unpreparedness in Facing Setbacks
When making such a big change to your company, you can’t expect everything to go smoothly. You’ll face a number of setbacks, but you need to prepare for them in advance. For instance, migrating your data could take longer than you anticipated, which could offset the overall trajectory of the transition. In that case, it’s better to have a contingency plan that holds the fort until you’ve worked your way around the problem.
The Internal Team Not Being on the Same Page
A part of the human brain sees change as threatening. Whether it’s something as small as getting a new haircut or something as big as implementing new technology, not everyone is welcome to disrupt the status quo. If you notice this problem within your internal team, address it immediately. And the most effective way to do that is by conducting training sessions to get everyone on board.
Tips for Building a Robust Digital Transformation Strategy
- Set realistic goals
- Involve your employees at every step of the journey
- Decide why you’re implementing digital transformation
- Keep your customers at the center of the journey
- Implement a technology-first culture in your organization
- Seek help from industry experts
The Future of Technology Is Digital Transformation
Now more than ever, your business needs to keep up with the ever-changing landscape of technology. Otherwise, you risk losing customers and generating revenue, becoming obsolete. That’s all the more reason to consider investing in digital transformation.
It yields substantial results, provided you follow a step-by-step process and do everything right.
If you need additional information regarding digital transformation, feel free to talk to Design Genious. Apart from providing a comprehensive range of services, including app development, SEO, and SMM, we possess in-depth knowledge pertaining to the latest industry trends and developments.