What Is Digital Transformation?
Thus far, the marketing function was responsible for delivering consumer experience. This was justified because there were limited consumer interaction opportunities available, and of them, most were controlled by marketing (retail, e-commerce, events & exhibitions, some part of customer support etc.).
However, given that today, the consumer experience depends upon not just the interaction or touch points but also from the volume and analysis of data that gets generated out of business to consumer interaction and consumer to consumer interactions.
Due to this, digital technology should be used to integrate various functions and units of an organization so that the organization gets a better view of the consumers, their own processes as well as behavior insights so that a consistent experience and value can be delivered to the consumer
So, digital transformation, transforms your people, business processes, business models, the culture and focuses on, more innovation- all by integrating digital technologies across the board
WHY IS DIGITAL TRANSFORMATION NEEDED?
Hilton took about 100 years to become what it is now, one of the largest valued chains of hotels in the world. How much time did AirBnB take to create a similar value? Less than a decade!
An average S&P 500 company would stay there for about 60 years in 1958. This came down to just 11 years in 2011. And Today? Perhaps every 15 days the S&P 500 companies are being replaced
According to a report by Forrester, 50% of the revenue of surveyed companies, will come from digital BY 2020.
So, once again, digital transformation IS NOT just using AI, chatbots, and IoT, it goes beyond this to focus on new ways to do business and create value.
For e.g. General Electric’ transformed it’s heavy manufacturing products- Locomotives and Jet turbines into a software services business through its ‘Digital; Twins’ initiative.
Today GE builds a digital twin of each physical asset that is installed anywhere in the world, and constantly monitors variables like location, temperature, service records, functioning etc. and integrates with machine learning and algorithms to receive predictions and alerts faster and hence proactively respond better.
Understand the concept of Digital Twin in another way from the perspective of Philips Healthcare:
This information becomes richer by getting information from cohorts ( such as a fleet of jet engines) and hence the organization and GE can get various insights based on a collection of data from various assets.
THE DOTCONVERSE 3 Cs OF DIGITAL TRANSFORMATION
- Culture- Includes People, Change and Innovation attitude with digital
- Continuum– Includes business processes and transformation through digital technology
- Consumer- includes new business models and a unified view of customers across the organization leveraging digital
So, we can start by asking a simple question: – What are we going to do to exceed customer expectation at each level of its journey?