You
have been hearing about Fourth Industrial Revolution. It's probably the
hottest topic for businesses, thought leaders, policymakers, scientists
and of course technocrats.
Klaus Schwab, the Founder and
Executive Chairman of the World Economic Forum, who coined this term,
writes - "The First Industrial Revolution used water and steam power to
mechanize production. The Second used electric power to create the mass
production. The Third used electronics and information technology to
automate production. Now a Fourth Industrial Revolution is building on
the Third, the digital revolution that has been occurring since the
middle of the last century. It is characterized by a fusion of
technologies that is blurring the lines between the physical, digital,
and biological spheres."
He makes a very important, pertinent
point - "Neither technology nor the disruption that comes with it is an
exogenous force over which humans have no control. All of us are
responsible for guiding its evolution, in the decisions we make on a
daily basis as citizens, consumers, and investors."
While Digital
Transformation as a term is still misunderstood, today, digital
transformation as a business imperative is widely agreed upon. What then
is a digital transformation in practice? Is it an IT project? Or the
introduction of a few cool tools in the company? Or the addition of a
mobility is driven customer relationship management (CRM) initiative to
engage customers better?
As an organization, if you are looking to
embark on the digital transformation journey or trying to stay away
from it, there are still a few myths around digital transformation that
you need to steer clear of. If you want to lead your organization
through digital transformation, the first step is understanding the
realities of digital transformation - rather than getting carried away
by the hype.
In this article we use excerpts from a few, prestigious industry reports/white papers to dispel a few myths.
The reports/white papers that we quote from include:
-
World Economic Forum's (WEF) White Paper on Digital Transformation of
Industries: Digital Enterprise, developed in collaboration with
Accenture
-
Forrester's Report, The Digital Business Imperative, co-authored by Martin Gill and Nigel Fenwick
-
Digital is a fad; a trend that my business need not think about
-
digital transformation process
Digital has transformed the market context for every business, and the pace of change is accelerating.
The WEF White Paper says -
There is widespread recognition among leaders in most industries that
the role of digital technology is rapidly shifting, from being a driver
of marginal efficiency to an enabler of fundamental innovation and
disruption. Digitalization is the cause of large-scale and sweeping
transformations across multiple aspects of business, providing
unparalleled opportunities for value creation and capture. Business
leaders across all sectors are grappling with the strategic implications
of these transformations for their organizations, industry ecosystems,
and society.
Digital Transformation means exceptional customer experiences powered by new technologies
Digital
has impacted not just channels and customers. It is disrupting
organizations from within - changing the way they do business. Digital
brings new opportunities for organizations that can embrace the
technology fast enough. It speeds time-to-market, reduces costs, and
unlocks new revenue streams.
Forrester Report says -
Digital business isn't just about customer experience; it's also a way
to drive operational agility. Digital operations can increase
speed-to-market, make employees more productive, promote leaner
processes, and maximize asset utilization.
Let me build an app. My digital transformation is done.
Digital
transformation is not about the introduction of a few tools that are
geared to change a particular facet of your business, be it employee
collaboration or customer transactions.
Forrester Report Says -
-
Digital fundamentally changes your relationship with your customers. You
can't address this change with a bolt-on digital strategy that adds an
app here or a site there. To remain competitive, you must re-engineer
how your business creates value for your customers in the digital age.
-
Re-envision your business not as a set of products and services but
instead as a part of the personal value ecosystems that your customers
assemble according to their needs and desires. Learn to increase value
by expanding your company's role in your customers' personal value
ecosystems.
Digital Transformation can only occur through disruptive technologies
Every
digital transformation exercise need not take the examples of Uber and
Airbnb in terms of the use of emerging technologies. The technology
stack that you would use depends on your business context and
technological leverage is just one part of the digital transformation.
Sometimes, you may achieve significant enhancement of productivity,
agility, and customer-centricity through the use of tried-and-tested
operational technology (networking and databases) and strategic
technology (enterprise resource planning or customer relationship
management) or mobility.
WEF White paper says - A
truly digital enterprise stands for more than just using new
technologies for the sake of it. Rather, what truly distinguishes and
gives a digital enterprise its competitive advantage is its culture,
strategy, and way of operating. Digital enterprises strive continuously
to enable new and leaner operating models underpinned by agile business
processes, connected platforms, analytics and collaboration capabilities
that enhance the productivity of the firm. A digital enterprise
relentlessly searches out, identifies and develops new digital business
models, always ensuring that customers and employees are at the center
of whatever it does.
Digital transformation: I need to get this done this year so I am not falling behind
Digital
Transformation cannot be and need not be a sprint. It is a long journey
with multiple touch points and milestones; dependencies and synergistic
endeavors.
Forrester Report says - You need to
transform your business by applying digital thinking across everything
you do - how you win, serve, and retain customers; how you operate your
internal processes; and how you source business services.
For
example, your answers to the below questions alone will help you craft a
roadmap that takes digital transformation beyond the realm of IT.
Digital transformation business success
-
Have you identified areas in your business where automation is most relevant?
-
Is your existing workforce consistently improving productivity and quality?
-
Which steps have been taken to convince your investors about your
digital vision and the long-term value-creation of your digital
transformation journey?
-
How much of your revenue is coming from new sources of digital business?
-
Do your company leverage analytics around customer data, operational data, and compliance?
-
Do you have a digitally literate leadership team?
-
Have you established training programs to overcome the digital skills gap and reskill your existing employees?
-
How are you empowering employees through digital channels to enable
faster decision making and encourage greater agility within your
organization?
These are just a few myths we have tried to address. We invite you to share your take on these as well as other myths.
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