Today, digital transformation has become a trend among organizations from different industries because this approach contributes to business strategy improvement.
Among the main effects of digital transformation is the ability to launch new business processes and change existing practices. Thus, digital transformation is the process of bringing new ideas and methods to life. At the same time, for its implementation, it is necessary to take into account the enterprise infrastructure.
The reason why infrastructure is so essential is that it is the foundation of any transformation. Architecture usually brings together technologies and provides business context. And since digital transformation is entirely dependent on the enterprise technologies adoption, architecture is critical in this case. That’s why technology due diligence services often go hand in hand with the organization’s transformation processes.
In addition to technology adoption, digital transformation requires strategic planning to match available technology with business goals. When planning, it is important to have a clear understanding of the many processes that are relevant to transformation. These include:
- Deep understanding of your customers and stakeholders’ needs and challenges
- Analysis and knowledge of the market your organization targets
- Compliance with the rules and requirements of the industry regulator
- Technology landscape available to the organization
- A clear understanding of existing business capabilities
All this helps to plan the organization’s digital infrastructure, increasing the chances of a successful enterprise transformation.
Let’s take a closer look at what digital transformation is and what core elements it has.
What is Digital Transformation
Conceptually, this means the transformation and adaptation of processes to technologies that use digitized information. And the main task of transformation is the effective use of these technologies to apply changes to the enterprise operations.
One of the most common types is the digitization of paper documentation, as well as the forms required for interaction between the client and the organization. In other words, transformation provides that interaction in a digital or virtual environment.
In addition to enhancing business processes, it improves the customer experience and makes the organization’s services more accessible.
The company’s digital transformation implies complex work when different enterprise departments must interact. Thus, it has to do with all the processes and operations that take place within the company. Therefore, careful preparatory work is always carried out before the start, and responsibilities are distributed between the teams. For example, solutions architect roles and responsibilities are established to ensure the transformation is consistent with the organization’s business strategies and goals.
Key Elements of Digital Transformation
Digital transformation has several key elements that are necessary for its successful implementation. And if one of these elements is not sufficiently satisfied, then there are risks for the entire project. In other words, core elements can also be called the main obstacles a company may face during digital transformation.
These obstacles most often include:
- The culture and mindset of the company. If the top management mindset runs counter to technological progress, it becomes a significant obstacle since new technology adoption naturally requires new approaches to solve problems. Thus, it can be said that the process of transformation starts from the head first.
- Digital transformation strategy. Enterprise architecture infrastructure is another key to transformation. Here it is essential to ensure that the enterprise has a clear plan for implementing digital transformation, which would be consistent with the architecture of the enterprise and its business goals.
- Budget. The success of implementation directly depends on the resources and technologies available since complex tools and technologies are often required to achieve the goals. Therefore, setting the right budget is critical in such a case.
Thus, knowing the possible obstacles that may arise on the way to digital transformation, enterprises should pay special attention to 3 key elements, which include the budget, tools, and mindset.
Budget
When planning a budget, it is worth asking the right question first. This means that instead of evaluating the budget only, attention should be paid to what is needed to deliver maximum value. That is when planning a digital transformation strategy, it is essential to organize work with an emphasis on customer value that a client can receive. This is the starting point for setting the organization’s budget.
This approach allows you to make the right decisions to improve customer satisfaction. Therefore, an organization should focus its efforts and attention not just on the estimated costs but also on the budget required to create and deliver value to avoid mistakes in digital transformation.
Tools
This is one of the most challenging tasks when it comes to implementing digital transformation. The problem is that finding the right technology tools can take some time and effort, especially during the planning phase.
As with setting a budget for transformation, it’s also a good idea to start by asking a question when looking for tools first. In other words, you need to focus more on the tool, not as a solution to a problem but on the way to use it most effectively. That is, the value of a tool is determined not by what kind of tool it is but by how it can expand your capabilities.
Mindset
The mindset is the key element, as any transformation is about vision and change first and foremost.
That is why it is crucial to establish communication between all the participants involved in the process to convey the understanding and essence of the transformation. After all, the main obstacle to change is usually the people’s resistance since any change implies the need to develop new habits and lifestyles.
Thus, the process of digital transformation should begin with the organization’s corporate culture and the way of thinking of its leadership and managers responsible for the project.
The main thing to remember is that transformation is not only about the digitalization of business processes but about restructuring business systems. Therefore, communication and close collaboration between teams is essential to avoid fragmentation.
Among the major steps critical to transformation is rebuilding the existing hierarchy and adapting to change. With the right mindset and culture of the enterprise, the digital transformation process runs much more smoothly, allowing not only to improve existing processes but also to achieve business goals and deliver value to customers.
