April 15, 2019
If you don’t get on the Industry 4.0 bandwagon soon, you’ll be left behind – and you’ll be less profitable than had you taken the leap when you should have. We’ve all heard the saying, “if you are green, you are growing; but if you are ripe, you are rotting!” Organizations like yours are devoting time and money to saving time and money – it’s that simple.
Digital transformation, or DT, is the journey of digitizing core functions of a business from data entry, order processing and sales to how customers interact with your business. It isn’t just a trending term and contrary to popular belief, it’s not all about technology. It’s about the culture of a company, leadership’s openness to growth and change, and most importantly, their willingness to identify the areas of opportunity, expose them, and leverage digital initiatives to close the gap.
Companies are more focused on DT, the journey of digitizing core functions of a business model, than ever before and for good reason. DT budgets will grow 25 percent and 40 percent of all technology budgets will go toward DT in the coming year. This means that companies are investing time, effort, and budget into being flexible, efficient, and productive. By continuously using technology and data to evolve all aspects of the business model, companies are improving their bottom lines.
Some see a greater impact on their DT efforts than others, but why? A lack of focus, leadership attention, and/or funding can derail even the best-intentioned DT initiatives. According to Harvard Business Review, $900 billion DT dollars went to waste in 2018, yet it remains the number one concern for companies in 2019. Why did 70% of DT initiatives fail? Because the culture didn’t support it.
The leadership and culture of an organization must be hyper-focused on driving efficiencies and promoting a digital culture to be successful. Strong leadership is a top tactic for overcoming challenges associated with DT initiatives. If the leadership team isn’t both feet in, they should step out of the ring until they are ready or hire people who are already focused on digitizing. But, don’t wait too long because the industry is moving on without you and the impact could be far more than you bargained for.
You don’t have to do it all at once. In fact, don’t because you could be biting off more than you can chew. Upgrading legacy technology and processes requires a dramatic culture shift. This is why leadership support is critical when making an investment in your digital future. When facing an upgrade to technology, it often has a ripple effect on the entire business from integration with other systems to the customer experience. Take time and focus on digitizing the core functions of the business first. It allows you to stay flexible, responsive, and agile to demands, but it also allows you to succeed.
Be strategic and prioritize the foundational steps of becoming a digital enterprise. Continually evolve and transform with new technologies to reinvent the way you do business. Becoming a digital enterprise isn’t a final destination, so enjoy the ride. As technology advances, so must you. However, you should take the time you need to analyze and strategize before investing in a DT initiative, leverage employees who operate in the day to day, recognize the feeling of being replaced, and be forward-thinking and agile.
Start with secure infrastructure and data mastery. Consider the foundation of your business – it’s built on infrastructure, data, and talent. These should be the top priority for your DT journey.
By embracing secure, cloud-based software and tools, and powerful data, you are empowering senior leadership to make better business decisions through improved efficiencies and insights. It also allows companies to pursue new opportunities effectively. Digitally mature companies achieve above-average financial performance. It’s a fact. Bonus: it can also encourage collaboration, consistency, accountability, and transparency between peers and leadership.
For DT efforts to be successful the leadership and culture must be in alignment with the goal of DT and becoming a digital enterprise. Without it, these initiatives will fail. Focusing on the wrong functions of your business first can also be a misstep in the journey to digitizing.
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