Why is Digital Transformation Important to your Business?
The pandemic effect has brought the topics of risk management and business continuity to the boardroom of every business and, as a result, we see near-universal acceptance that digital transformation cited as an actionable item of the highest priority.
A well-delivered digital transformation program, adequately supported and funded by senior management, reduces risk and strengthens every business to better ensure its future success. We’re going to explore some of the key drivers.
Digital transformation is the leveraging of technology to enhance business processes, customer experiences and corporate culture. These processes might already be digital, but so dated that they’re inefficient, or the process may still be manual – such as your accounts payable team keying data by hand, such as when processing incoming invoices and loading them into your financial suite.
With the pace of technological change, what required a full-time employee to fulfil just five years ago, might now be a role for which 80% of the function might be fully automated, as it is with modern Purchase to Pay (P2P) solutions.
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The field of risk management is all encompassing, and with the pandemic business leaders have discovered how unprepared they were for most outcomes. Certainly, litigators and insolvency administrators are salivating. These days, with the advent of GDPR and the hazards of data protection, the risks have prompted a more pervasive awareness.
Your Health and Safety Obligations
Nobody anticipated the work from home edict, or the huge acceptance of such a change. It prompted a surge in laptop purchases and an exodus from offices, and it wasn’t too long until the Health and Safety Executive (H&SE) stepped in to remind businesses of their obligations to protect their employees, whether it’s for their seating, stress levels, or the fundamental tools required to complete their jobs.
Did you equip your remote staff correctly? As the lock down took effect, and employees decamped their bedrooms and home-offices, did you give your HR department the resources to mitigate the risk of claims?
With the shift to working from home, came unintended consequences: staff discovered that they couldn’t transfer files easily, and so there was an epidemic of uncontrolled file-sharing through public platforms (such as Dropbox™, Skype™, and Google Docs™ etc.), lax data destruction, ad-hoc and insecure video conferencing applications, to name just a few.
At a stroke, your IT departments’ efforts, budgets, and resources of past years to protect your firm from ransomware has been undone.
Those firms which had undertaken digital transformation programs were at reduced risk: their systems were designed to function irrespective of where the employee was based, and the flow of data to staff continued unabated, and with risk of accidental exposure.
Document Management and Data Flow
A well-conceived digital transformation approach mitigates many such risks by removing so many of the potential obstacles at the outset. For example, a document management and workflow suite can ensure the continuous flow of data, with absolute security.
Automation of any process which involves manual data entry, means staff don’t require access to paper files and so, for example, you would consider a Purchase to Pay (P2P) solution for your accounts payable team.
Understand the flow of data throughout your organisation, and so reveal where it’s being used inefficiently. This will include where data is being gathered manually, handled physically (such as when printed), converted, or shared as attachments to emails.
With such a data flow map, your digital transformation program can begin to take shape.
From the perspective of your business continuity plan, you’ll be weighing the risk of regulatory sanctions, employment tribunals, and contractual disputes, as just a few of the many threats.
But business continuity goes much further, and extends across cost reduction, minimising your dependency on specific employees, reducing your overall employee headcount, and diversification of your business in every respect, including your reliance on a handful of key accounts.
A well-considered digital transformation program is important to your business because it can deliver all of this and more.
What are your Digital Transformation Drivers?
According to the 2018 McKinsey Global Survey, apart from the examples above, businesses are looking at digital transformation to deliver the following benefits:
- Improve customer outcomes
- Increase digital revenues
- Increase digital traffic
- Reduce operation costs
- Launch new products or services
- Improve product or service quality
- Reduce time to market
The reduction of operation costs is a universal objective, so has your organisation adopted a document management and workflow system? How about a Purchase to Pay automation suite for your finance department?
As the leading vendors of both technologies rely on artificial intelligence (AI), consider that among respondents at companies that have embedded or piloted AI in one or more functions or business units, 76% say that it has created significant or moderate value.
Using Digital Transformation to Improve Efficiency and Profitability
Companies that undergo digital transformation improve efficiency and profitability. Consider these results reported by the SAP Center for Business Insights and Oxford Economics:
- 80% of organizations that have completed digital transformation report increased profits.
- 85% say they have increased their market share.
- On average, leaders expect 23% higher revenue growth than competitors.
Cost reduction is multi-faceted, and your digital transformation journey should be exploring the hidden costs across your business.
Consider Print Management
As an example, does your IT team maintain in-house print servers? Especially if yours is a multi-site operation, simply migrating to cloud printing which places your print servers in the cloud, can release tens of £1,000’s of spend on an annual basis.
Adopting modern print management solutions represents digital transformation at its most relevant: that current digital process is hindering the organisation’s financial health, and it’s time to transform the process to benefit from the most modern technology.
Writing as someone who’s been delivering digital transformation for three decades, I believe the leading global consultancies remain focussed on selling consultancy vs. delivering effective change. Even the typical SME can reap the rewards, while demonstrating a return on their investment in a single quarter.
When we look at the customer journey, and the rate of errors which cause a business to lose customer goodwill, it’s not uncommon to find that 5% of turnover was wasted on avoidable errors. Were these due to data entry faults, scheduling, miscommunication or otherwise?
Practical Examples of Digital Transformation
To offer a simple example, a regional law firm – single office, 30 staff – found themselves at a disadvantage due to their clients comprising many non-native English speakers.
Their initial digital transformation initiative consisted of installing an AI-driven translation app onto their office printers. This means that today, they can scan lengthy documents and have them converted in moments to the language required.
Another client, a mid-sized construction firm, faced scrutiny of its health and safety procedures and used the same translation app utility to ensure their workforce was completely aware of the policies, risks, and procedures when working on each site.
In both cases, the cost for such a process enhancement was tiny, but the resultant gains proved to have a significant impact.
Prevent a Data Breach via Digital Transformation
Survey result of businesses in the past year:
90% had at least one security breach
Your Data Protection Officer or Compliance Officer can enforce protection of personal data by configuring the print management software to redact data automatically, or otherwise restrict documents from being printed altogether.
In terms of enforcing compliance with the GDPR, advanced print management is essential.
By ensuring your staff must use secure print release and authentication with follow-you printing, which simultaneously creating a chain of custody for printed documents, your organisation minimises the risk of data breaches or outright data theft, while enhancing your security, regulatory and privacy obligations.
Both consumers and corporate buyers alike have become more demanding than ever with respect to their customer experience. Indeed, so profound is the demand, that Customer Experience is now known as ‘CX’, and it’s a major industry in its own right. CX is the battleground of 2021.
Gartner reports that more than two-thirds of companies say they are competing mostly on customer experience, and the results for 2020 are forecast to show that number to rose to 81%.
Accenture reports that CX
“has emerged as the key driver of sustainable business growth.”
They suggest that even a single point increase in CX scores can results in millions of dollars in annual growth.
The Top 4 Challenges of Consumer-facing Businesses
What’s changing, and how has your organisation adapted? Here are four of the top challenges confronting most consumer-facing businesses today:
- Your customers demand interactive digital channels, including live chat, messaging apps, and voice assistants.
- Customers expect faster, more comprehensive, service than ever before. For example, 44% of Facebook users expect an answer within thirty minutes, and they’ll tolerate just two hours to receive your email reply.
- With competition only a click away, loyalty has dropped, meaning service and experience are central to retaining customers
- The customer is reliant on their smartphone, and it’s an ‘always on’ device for brand interaction. This, coupled with the massive uptake of review sites, such as TrustPilot, mean the modern consumer will not hesitate to be vocal about customer service they perceive to be sub-standard.
When we consider why digital transformation is important to your business, it’s because our ability to attract and retain customers is at the heart of what we must all achieve.
When we understand our customers, and then examine our systems, it’s never long before we see how we’re letting them down.
The modern customer demands immediate response. And, so, I close the article by asking you how your office telephone system coped during the Spring 2020 lockdown: did all of your telephones divert automatically, and could you staff working remotely transfer calls between each other? Probably not. How much did that single failure cost your organisation?
Your digital transformation journey might begin with migrating to a VOIP telephone system, and this will please not only your customers, but it will delight your staff too.
From a management perspective, you’ve just reduced your risk, and from a business continuity standpoint you’ll have implemented a key disaster management feature.
One thing is certain: digital transformation is continuous process, and its importance will remain supreme.
Humperdinck Jackman – Marketing Director
Humperdinck has a 30-year career spanning Document Management Systems (DMS), data protection, Artificial Intelligence, Data Protection and Robotic Process Automation. With many articles published in print internationally, he believes the advances in office technology are such that we’re entering the 4th Industrial Revolution. Now Director of Marketing and Consulting Services at Advanced UK, he’s as active with clients as he is in endeavouring to write original blog articles.