Digital Transformation – How Do We Get There?

Last month, we discussed how a leading company like Amazon is harnessing emerging IT capabilities to continuously reinvent themselves, expand market share, enter new markets, and create new products and services. When we discuss these concepts with middle market managers and business owners, the question we’re most commonly asked is “How do we get there?”

For starters, digital transformation needs to be an organizational mindset. Management’s core belief should be that the company needs to leverage emerging technologies to improve or introduce new capabilities; otherwise, it will not be able to grow and prosper. Without this initial belief system, it will be very challenging to establish an effective strategy around emerging IT capabilities.

We have seen this belief system play out in two different ways – reactive and proactive. In the reactive case, management is usually facing increased competition – from well-established competitors as well as new entrants into the market – that is leveraging new technologies to improve delivery capabilities or to heavily disrupt market norms. For example, most residential and commercial service contractors now need to offer easy appointment scheduling, communicate with customers in regards to their service tech dispatch and arrival time, and provide after service electronic acknowledgements, customer portal, and billing capabilities. Service companies not providing such capabilities will simply not be able to scale and grow, as these are now seen as customer must-haves in industries ranging from HVAC to lawn care and other service-related businesses that deploy technicians to address customer issues.

In the proactive case, managers and business owners identify opportunities to leverage emerging IT capabilities in an innovative fashion to get a jump on competition or raise the bar for market entry – playing offense rather than defense. Being proactive is a risker approach, but the rewards are also higher if executed successfully. We have seen clients across several industries identify digital transformation opportunities to achieve exponential growth through expanding market share and entering new markets. For example, a local company introduced an innovative way to provide cleaning supplies to commercial clients through e-commerce. Another client created a fast and efficient way to set up drug testing capabilities globally, which could significantly reduce a pharmaceutical firm’s drug approval process.

Here are some other items to consider when thinking about your organization’s digital transformation:

  • What are some new potential products, services or capabilities that your customers can benefit from?
  • Which steps are not adding value in your current operational process and could either be improved or eliminated?
  • What potential IT tools and techniques could enable innovation and process excellence at your company?

When embarking on a digital transformation journey, one size does not fit all. Such a journey could range from evolutionary for incremental improvements to revolutionary for rapid change. The right strategy will be driven by several factors such as market dynamics, organizational capabilities, resource availability, and management priorities. We would invite a conversation to learn about your organization’s challenges and help you create a roadmap for your own digital transformation.

Sassan S. Hejazi can be reached at Email or 215.441.4600.

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