What exactly is Digital Transformation?
One of the reasons I decided to become a Virtual CIO was so that I could talk to a wide variety of businesses about emerging technologies and explain in layman’s terms why I feel you should or shouldn’t be using them within your business. Unless you’ve been living under a rock, digital transformation is a buzz phrase you are probably seeing and hearing everywhere, but what exactly does it mean?
Put simply, digital transformation is the use of new digital technologies within a business to make processes more efficient or effective.
So, whilst the phrase might be reasonably new, the idea is certainly nothing new to tech in business. Think about the major shifts we have been through in the past; mainframes to personal computers, faxes to emails, physical servers to virtual machines, and the ever-increasing mass migration of applications to the cloud.
The digital transformation we are hearing about now though (also known as DX 2.0) often refers to newer technologies such as Artificial Intelligence (AI), block chain, Augmented Reality (AR), Internet of Things (IoT), big data and machine learning.
If you’re a small or medium business owner you’re probably glazing over by now thinking what could we possibly use that stuff for in our business?? Let’s look at some relatable business reasons which could lead you to taking some of these technologies into consideration.
Improving Customer Experience & Engagement
Customers are arguably the biggest driver of digital change in business, we live in an ‘always on, give it to me now world’ and if you aren’t nimble with customers, they’ll just move on to a company who is.
Introducing AI in the form of a chat bot might be the right move for your business if you’re in customer service. Chat bot’s will work for you 24/7, 365 days a year and can handle a workload far greater than a physical agent. Chat bot’s can answer common questions about a product or service and then introduce a real person if they are unable to answer the query, or perhaps when the customer is ready to buy. Although millennial’s spend more time on their phones than anyone, they aren’t using them to make calls to companies – most now prefer interacting over live chat.
Speaking of phones, perhaps a mobile app for your business is an option. There’s a myriad of different ideas to explore, apps can be great for promoting your products or services, engaging with customers, integrating with social media platforms to collect data, detecting through geo location when a customer is near your store and sending them a notification for a limited time offer.
Enhancing the Employee Experience
Obviously, customers are important to a business, but so are employees. Retention of staff should be constantly on your business radar, and happy employees are more likely to give your customers a better experience.
If your business isn’t moving with the times, chances are your employees are going to move to someone who is. Can you get rid of your legacy archaic line of business applications and move to SaaS (Software as a Service) solutions, increasing productivity and employee experience? In a world of ubiquitous connectivity a lot of businesses are adopting the principle “Work is something you do, not a place you go”. Do you make it easy for your team to work from the road, a cafe or from home?
A BYOD (Bring Your Own Device) policy is a great way to allow those who want to use their own Smartphone for work purposes, or those who prefer to use a Mac over a Windows PC (obviously this only works if your systems support such devices and they also need to understand your IT team probably aren’t going to support them either).
Implementing new HR tech such as peer rewards or career progression systems for feedback, reviews and development may help keep staff morale up.
More Effective Manufacturing Processes
Almost anything can become an IoT enabled device these days, I’m constantly amazed by this field of technology. Gartner predicts that next year (2020) there will be over 20 billion IoT devices in the world. They can be used for monitoring the health and production capability of machines on a production line, ensuring produce is kept to a quality standard from harvest to the supermarket, utility monitoring (power, water etc), vehicle and asset tracking – the possibilities really are infinite.
AI and machine learning can also come in to play with manufacturing; optimising operations and product quality, reducing waste, predicting machine failure, even autonomous picking and packing systems are now being developed.
Augmented Reality is being used on smartphone applications and glasses to overlay labels or instruction manuals in factories. Remote engineers can help an unskilled employee fix a problem on site by seeing exactly what they are seeing and walking them through the process.
Financial & Identity Applications
PayPal, Apple Pay & Google Pay are all now mainstream systems for payment, physical cash is becoming a hassle to most people. I’m sure it’s going to trip me up one day, but I rarely even take my wallet anywhere as I can do everything I need to from my phone. If your business isn’t offering easy ways to pay it may just be too hard for some customers.
Big data, AI and machine learning is being used to detect fraudulent transactions and act within seconds, protecting both businesses and consumers.
I’ll leave the block chain explanation for another article, but it’s essentially the technology underpinning Bitcoin currency, and is tipped to be one of the biggest advances in technology since the internet itself. There’s currently a lot of attention and money being focused on block chain by very large enterprises, but how could it be used in small business? Well it’s still early days yet, but besides sending and receiving payments it can also be used in managing digital identity’s, notarization of documents or photos, gift cards and loyalty programs. Block chain technology takes the ‘middleman’ out of the process, so you don’t need a bank, credit card clearing house, or government system to approve transactions. It could provide much more efficient ways to do business.
Strategy and Adoption
Hopefully I’ve been able to provide you with some clarity about digital transformation and perhaps given you some ideas about how your business could benefit from it.
Lastly, it’s important to understand that the main difficulty is not the migration to, or installation of these technologies, but the adoption of them by the team members within a business. I believe the key to adoption is to involve all crucial team members in the digital transformation process and strategy as early as you can. If the process is driven entirely by senior management / executives or your IT department and then handed over as a finished product then it is often met with stonewalling, resulting in a complete waste of money and time.