What is a Digital Transformation?
It’s the use of digital technology to solve traditional business problems across four main areas:
How a company attracts new customers
How they deliver value to customers
How they operate
How they make strategic decisions
All four areas contribute to the overall health of a business in different ways:
When you’re able to attract a steady stream of new business, revenue becomes more predictable and stress levels ease.
When you’re able to deliver an exceptional customer experience — not just once, but always — fewer people go searching for an alternative.
When you’re able to operate at peak efficiency, you save precious time and money that you can pour back into your business, to grow even faster.
When you’re able to make more well-informed strategic decisions, you make fewer mistakes and go down the wrong path less often. As a result, you get to pursue a greater number of profitable opportunities.
Digital technology can solve all of the above better, faster, and at a greater savings than ever before.
When the TED conference started in the 80s, for example, it was 800 people getting together once a year. Now because of technology, TED talks reach over one million people every single day Online.
“How to implement” digital strategies is not the topic of this article. Before you ever go there, you need to believe that it’s (1) necessary, (2) doable, and (3) worth your time and money.
Otherwise, what’s the point?
Transform Now, Not Later.
Although some companies are taking “Digital Transformation” seriously — the planning and implementation of some kind of digital strategy — it’s not nearly enough of them. The size and age of a business usually plays a role in whether they’re interested. And if so, what they transform first, second, third, or not at all.
According to a study by the research company, SMB Group:
Small businesses (under 100 employees) are two to three times less likely to implement a Digital Transformation than a larger company. But of those that do, almost half (43%) start by transforming “how they attract new customers,” because that’s their biggest problem.
Whereas medium-sized companies (over 100 employees) are placing a greater importance on “customer experience” and “streamlining operations.”
Companies with greater than 1,000 employees are mainly looking to improve “employee productivity” and decision-making so they can “capitalize on new opportunities.”
And regarding age, young companies (those in business fewer than five years) are twice as likely to implement a Digital Transformation than older companies, because there’s less to re-engineer from the ground up.
Every company of every size and in every industry must (in my opinion) start their Digital Transformation today.
Because right this minute, geniuses in basements and garages and Fortune 500s (if they’re smart) are strategizing and thinking of ways to disrupt their industry. They’re leveraging digital technology to create an extreme competitive advantage — looking to make their competition irrelevant in the process.
And they will succeed.
Eventually, someone or some research department will find a better, faster, easier, and less expensive way to deliver ten times the normal industry value.
The status quo is a dangerous place.
Twenty percent of startups fail in their first year
About half last five years
And only one-third reach ten years
It’s hard enough to survive with odds like that stacked against you, but if you’re a business that’s not committed to change — if you’re happy with the status quo — your odds of survival are, more than likely, much worse.
A mortgage broker, for example, who refuses to transform will have trouble defeating a competitor who automated their lead generation, sales process and customer follow-up. The gap will widen even further if that competitor improves their “customer experience” by simplifying and streamlining their application process and customer support. And it’s game over if they start creating regular valuable content to better inform and inspire.
Customer, partner and supplier expectations are constantly shifting — widening the gap between what they expect and what you can deliver.
Well-funded, incredibly able and hungry-for-the-top-spot companies (both young & established) are going to fill the gap if you don’t.
Think Uber & Airbnb.
To defend your very existence, you must start thinking (and acting) like a technology company.
Domino’s is a great case study.
They sell pizza, but they think of themselves as a tech company. Dennis Maloney, Domino's Chief Digital Officer, in an interview with the Free Press, said "We used to be a pizza company that sells Online and we needed to become an e-commerce company that sells pizza."
They committed to a Digital Transformation and (as a result) unseated Pizza Hut as America’s biggest pizza chain. And they’re not finished with their transformation. Now they’re working on automated pizza delivery with drones and driverless cars.
Most businesses understand the digital age is here and that they must adapt, not just to survive (a good enough reason to start), but to thrive…
Both now and in the future.
But even so, somehow, the vast majority (three quarters of all small businesses under 100 employees) are still not implementing a digital strategy of any kind.
Lack of understanding. Most companies don’t have in-house digital marketing knowledge, they don’t know what they’re doing, and they don’t know who to trust. This is a big issue that holds a lot of companies (mostly small companies) back from doing anything at all.
Lack of time & money is a big complaint. About one third (34%) say they just don’t have the money to invest. And even if they did, existing demands don’t leave much time to implement new strategies.
Lack of will and belief. First of all, you have to overcome the “lack of understanding” issue to overcome this. But even if leadership fully embraced the idea that change is needed, they still need to convince employees and management who have not (yet) bought into the idea. And old habits die hard.
These are real problems, but not hopeless.
They have less to do with technology (actually) and more to do with adopting and consistently implementing a proven process.
You can always bring in experts to take care of the technology, but it’s the commitment and the follow through that is the hard part. I’ve seen this cause trouble with soloprenuers, small businesses and with large Enterprises, too.
It’s the same problem across the board… just on a different scale.
Ultimately, it’s up to the company whether they’re going to succeed, or not. But to give them the best possible chance, I developed a blueprint, a 3-phase process that is proven to take you from where you are today to becoming a serious digital competitor — a company with an extreme competitive advantage.
If you want my blueprint… the same system behind the most successful companies on the planet… let me know.