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The Need for Digital Transformation (Demo)

In his classic, “Origin of Species”, Charles Darwin stated that “It is not the strongest of the species that survives, nor the most intelligent. It is the one that is most adaptable to change.”

This statement is proving to be true not just for species but for companies also. Organizations that would survive and thrive in this era of tremendous change (that is being witnessed both in business and in the society at large) need to be able to do things differently. Digital technologies is driving that change. The need to adapt to this change therefore has led to the calls for digital transformation.

Such organizations (that would survive in this this era) must learn how to tap into the opportunities that change brings. In addition, individual professionals that would also remain relevant must understand the changes that are being brought about by digital transformation.

The following areas (among others) are being impacted by this change:

▪ Customer Expectations

▪ Workforce Engagement

▪ Competitive Landscape

Customer Expectations

Every organization exists to meet the need(s) of people. Such needs could be for products, services or ideas. The digital era has heightened the expectations and definition of people regarding what is acceptable as quality service, product or experience.

Today, one expectation that cuts across organizations in different industries is the need to have touch-points beyond the physical location of that organization. Customers want to be able to access products and services on-demand and have a seamless experience in doing so. Customer in this digital era have an option to first proceed online, before visiting a physical location. Thus for many customers, visiting a physical location has become a secondary option.

Take the hospitality industry as a case study; guests before booking a room start their customer journey online. They check out the hotels in a location, compare their rates and also go further to read the reviews of other guests that have stayed in the hotel. They also expect that it should be “a given” for them to be able to make their bookings right from their devices. Customers now believe they should be able to plan out their trips to ease their logistical burden

The implication of this on service providers in the hospitality industry is that they need to be digitally equipped in order to be able meet the needs of today’s customers.

The reality of this behavioural change by the customers is that every digital transformation effort or design has to put the customer’s expectations and experience at the centre. Otherwise, the results could be negative or could be very slow.

Workforce Engagement

Labour is central as a factor of production.

However, for employees to be highly productive, they need to be well engaged and equipped to perform their task. The advent of digital presents several tools by which these can be achieved. These tools provide solutions that range from recruitment, employee on-boarding, remote collaboration to performance assessment.

In embracing digital, great companies have  a mix of both offline and online solutions even for their recruitment process. However, the need to process a massive number of candidates while still needing to get the best irrespective of their geographical location has seen the emergence of more robust recruitment systems. Some of the companies there use some algorithms to evaluate key tasks such as candidate’s job fit and notifying potential candidates about opportunities that exist in the organization. With these steps, those organizations are able to access a large pool of qualified talents for consideration in future recruitments.

Beyond the recruitment of talents, computers on every desk is another testament to how digital technologies have transformed the workplace. Though many leading organizations have been acclaimed to have attained their heights from having processes that work, an organization is only as good as its people. Behind these processes, are people carrying out the various tasks within the organization.  It is then imperative for companies to digitally transform their processes not only for the benefit of the customer but also to improve the working environment of their employees.

Digital transformation also goes beyond the use of digital tools for processes. The advent of technologies such as Internet of Things (IoT) has shown how digital tools could assist to shape the design and operation of processes from the ground up thus giving employees access to data and insights in order to make well-informed decisions.

Competitive Landscape

The advent of the digital era has shaped the competitive landscape for businesses. Beyond their fellow incumbent players, companies are today threatened by emerging players who come to the industry with disruptive business models that seem unimaginable years ago. These players leverage internet connectivity and the widespread availability of digital devices in order to meet and exceed the needs of customers. This they do without necessarily putting in place massive investments that took the incumbents several years to build.

Classic examples of these are Airbnb and Uber.

Airbnb has been referred to as the largest hotel chain in the world yet they do not own a single hotel. Uber could also be said to be the largest transportation company in spite of having not started with any investment in a fleet of cars. The first reaction of the incumbents was to downplay the threat these newcomers pose to their businesses only to realise that they are the first point of call for a millennial generation of customers – a key market for any company that seeks to be relevant into the future.

Digital technologies have also made knowledge more accessible. The impact of this is that a level playing field is being created between players and barriers are being eliminated for new entrants. Today’s customers, through these digital touch-points now also have access to multiple service providers. This means that a customer can switch services more easily, thus redefining competition as we used to know it.

The sum of all of this is that as the business landscape changes due to customer preferences, there is a need for companies to be highly flexible. Digitally-driven companies have proven to be far more agile in adapting to these changes compared to those that are stuck in legacy mode.

In addition, what these changes also portend is that we are in a time of Digital Darwinism — a term used to describe “an era where technology and society are evolving faster than businesses can naturally adapt.”

Companies need to adapt or die. The first is a choice, the latter, is a consequence of inaction or nonchalance.   However, for companies to succeed in their digital transformation effort, fear should not be the motivation. Rather, the key motivation should be the opportunities that change represents.




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