Information technology (IT) has been all pervasive and industries have been compelled to adopt it. This is not only because their competition is doing so but because it introduces efficiencies, reduces costs, improves quality as well as service level.
However, such adoption has been in silos, with organizations proceeding cautiously, taking one step at a time to keep their costs low and implement solutions only for business-critical areas. While this has enabled them to see some success, the disparate processes and technologies have also limited the benefits to specific departments by introducing efficiencies only within their operational areas. Organizations neither have a holistic view of the process across functions, nor are they able to seamlessly integrate operations for greater visibility and collaboration.
New generation entrepreneurs, on the other hand, are racing ahead of, or at least catching up with, established businesses by leveraging the power of digital transformation. This is empowering them to introduce disruptive solutions, question the status quo, innovate as well as face failures with greater equanimity, rising again to meet new challenges with greater insights.
The driving forces
There are two forces fuelling digital transformation – one is, of course, the availability of enablers. However, the other is the ground reality that most organizations are still struggling with maintaining legacy systems, with about 72% of IT budgets being spent on existing IT concerns, and only 28% for new projects and innovation, according to a Forrester study. This is a big hurdle to growth and requires them to adopt agile business principles.
Digital transformation, which is powering the new age enterprises, is all about automating operations, facilitating collaboration between people and creating new business models by leveraging a variety of new age technologies. This has effected fundamental changes in the way businesses operate and deliver value to customers. Product and process innovations because of digitization of assets using cutting edge technologies have helped improve customer experience, operational agility, culture and leadership, workforce enablement, and digital technology integration. According to an IDC report, spending on technologies and services that enable digital transformation will reach $1.97 trillion in 2022, at a five-year CAGR of 16.7% from 2017.
Technologies that matter
The nine technologies driving digital transformation include the following.
Businesses are generating volumes of data in multiple formats that need to be stored in a retrievable format to create meaningful business strategies. Big Data technologies can handle the four Vs: Volume, Velocity, Variety and Veracity which legacy solutions and technologies cannot.
Analytics and reporting:
The data needs to be presented in a way that managers can easily understand to be able to take meaningful decisions for improving performance. The same data can be used by other functions differently but require solutions to be able to flexibly present them. Real-time reporting and advanced analytics tools are enabling not just interpretation of data for today but also predicting future trends for long-term strategy and decision support.
Cloud has had a big role to play in lowering infrastructure cost and freeing up resources to focus on core business competencies.
The growth in smartphones has enabled accessing information and products and services right at the fingertips. Mobile-ready apps have become mandatory for businesses to be able to tap the market more effectively.
While it may seem as a way for people to remain connected with their friends and relatives, social media has become a means of spreading positive and negative views about businesses as well. A great influencer, businesses cannot ignore the social media and need listening tools to garner opinions and views and plan their strategies accordingly.
IOT (Internet of Things) and wearables:
Embedded chips are fast becoming productivity tools as they improve user experience and keep people connected through wireless networks to their offices and homes. Healthcare is one area where this technology has proved to be very useful in remote monitoring of patients as well as self-monitoring of important health parameters.
Artificial intelligence and machine learning:
This is another productivity tool that not only helps automate processes, but also introduces efficiencies in automation as well.
This technology is playing a key role in disruption and innovation as even non-IT fields are benefiting from AR technologies to provide customer delight and enhance experience.
Chatbots and Voicebots:
They are freeing up resources by automating customer service and handling first level of queries, thereby improving service experience.
The increase in connectedness also increases the risks of cyber-attacks. Security solutions are become more proactive and reactive, ensuring safer systems.
Gamification, virtual reality, document management systems are amongst some of the other technology solutions that are enabling digital transformation. It is a matter of survival and growth where mere brand name or money power will not be enough to sustain a business anymore. Digital transformation that enhances user experience will be central to all business strategies, and it will be enabled by adopting the right technologies in a timely manner to stay ahead in the game.