8x benefits in 2023 from digital transformation (incl practical examples!)
Digital transformation is not an option, it is part of modern business. So, take it seriously.
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We all want, or need, to move with the times, not just personally, but also in business. Are you going to keep doing what you are doing now for the next five, ten, fifteen years? At some point, you will be so far behind that there is no way around it. Digital transformation is not an option, it is part of modern business. So, take it seriously. Fortunately, there are many benefits to digitizing your business, of which eight are listed below:
In a previous article, we cited a McKinsey study that concluded that approximately 60% of all occupations can be automated for at least 30% of the time. The differences by industry are great, and it would be a good idea to check the article to see how this applies to your specific industry. Then think about the possibilities that would open up to you if you delved into digitalization quicker than your competition. Can you imagine what that would mean for your productivity, effectiveness, competitive position, innovation, and budgets?
Starting with digital transformation
If you are delving into digital transformation for the first time, we always recommend starting with digitalizing or automating processes or operations. Later, you can boost the innovation of your product or service through digitalization. By starting with the small digitalizing of your own processes, you can achieve relatively large gains quickly and easily.
The good news is that with a simple digital transformation strategy, you can get started right away. Still doubting whether you need one? Then read why you absolutely need a digital transformation strategy.
Whatever your strategy, some extra motivation never hurts! We list 8 benefits for you:
• #1 - Save costs
• #2 - Increase your scalability
• #3 - Increase your agility
• #4 - Give your people more interesting work
• #5 - Better customer experience
• #6 - Better informed decisions
• #7 - Fewer mistakes
• #8 - Embrace new techniques
#1 - Save costs.
Digitalizing and automating complex work and processes makes it easy to save costs, not just on labor, but certainly on other resources including optimization of processes and assets. For example, you can use data analytics and machine learning to identify inefficient processes and bottlenecks. That will then help you to reduce waste and improve performance, saving you time, material and resources.
Example:
A large online furniture store delivers thousands of orders a year. If you want to use those trucks as efficiently as possible (with an eye on costs and sustainability), you want to automate the planning process. Let the system calculate for you what the most efficient route is and whether, for example, you can offer customers some discount if they agree to a flexible delivery date. Efficient routes are good for the environment, good for staff planning and good for your wallet.
#2 - Increase your scalability.
Automating business processes allows you to work more efficiently and increase your production capacity without the need for additional people, so you can do extra work with the same resources.
Example:
Let's look at the credit application underwriting process. Suppose an employee can process ten credit applications every business day. After automating (part of) that process, that employee might be able to process twenty applications per day. In quiet times, the employee keeps some time free for other work. In busy times, you may be able to have the simple applications approved or rejected directly by automation, and the employee only has to process the complex applications.
#3 - Increase your ability to respond faster.
Digital transformation makes it possible to respond quickly to changes in the marketplace. Working faster and more efficiently means you can enter new markets relatively easily. Real-time insight and analysis gives you the chance to anticipate new trends and make quick decisions about new opportunities.
Example:
Those who collect and analyze a lot of data have a quick view of opportunities. Think of online retailers who see exactly when certain items are often ordered and can therefore quickly buy extra stock. Or parties that launch a new offer in the market can discover how it works and can assess very quickly whether it produces the desired results. By experimenting a lot with the data, you have, you can quickly achieve success.
#4 - Give your people more interesting work.
Employees are your most precious resource. Digitization and automation give you the opportunity to free up human resources as people spend less time on relatively simple, repetitive tasks and have more time to focus on work that adds more value. Often, these are also tasks from which they themselves derive more satisfaction. Win-win!
Example:
Let’s use the example of credit applications once more. Automation can choose to automatically approve (or reject) the simple credit applications. The employee will then only receive the more complex applications to assess, the ones that need to be looked at carefully. This makes their work a lot more challenging and less repetitive.
#5 - Better customer experience
There are many ways you improve the customer experience with digital transformation. For example, consider response time: customers don’t like to wait. Whether waiting for a quotation, an answer from customer service or the implementation of a change in service, everyone likes a faster process. Digitized or automated processes mean that your customer is served faster, anywhere, anytime.
Other ways to improve the customer journey and add more value include making your service more personal or offering additional insight (into consumption or costs, for example).
Example:
We are more than used to the my-profile section of our energy supplier, internet provider or car insurance. It’s handy for looking up terms and conditions, providing insight into your own usage, communicating a change of address, or accepting a new offer. The my-profile section is usually available 24/7 which means you don't have to wait on hold and changes are processed in real time which is Ideal for both customer and supplier.
#6 – Making better informed decisions.
Digitizing and automation usually mean that you can work faster and easier with data, but also that you collect much more data. Digital processes offer (real-time) insight into the status, performance, or trends you are dealing with. You see it immediately when demand picks up, production slumps, processes take longer, or the number of error messages increases, enabling you to respond immediately. So, you make fast, well-founded decisions, based on hard figures instead of gut feelings.
Example:
Do you run a web shop? Then perhaps you would like to know which products are purchased at the same time. Or which products are often ordered x-number of weeks after the first purchase. Or which products are often viewed but rarely paid for. These kinds of trends and patterns are not easy to spot without analysis. However, they are easy to identify based on (real-time) data which then enables you to recommend related products or special offers.
#7 - Fewer mistakes.
Making mistakes is human. Digital processes aren’t. Look at data entry or other data processing, for example. Spelling mistakes, typos, a forgotten column here, a missed comma there. A mistake is in a small corner, but it can have serious consequences.
If you automate data entry or processing, processes become less vulnerable to human error.
Example:
In the planning department of a garden center, delivery orders are processed manually. Retyping address details and orders is error prone. About twice a month, the delivery van arrives at the wrong address, the agreed delivery date is unclear, or the ordered garden bench is accidentally delivered in the wrong color. A simple link between sales department and planning can prevent this.
#8 - Embrace new technology (and leave old technology behind)
By modernizing and automating existing digital processes and systems, you make your IT environment more manageable. Outdated systems and legacy applications are not only more difficult to manage, but they also often have low scalability and security risks. Embracing new technologies makes for a more manageable and better functioning IT environment.
Example:
A production company controls part of its production with internally developed applications written in obsolete programming languages for which little support can be found anymore. Minor changes require the (expensive!) support of a freelancer specialized in that language. This makes the system relatively difficult and expensive to maintain. The old technology limits the company's ability to break new ground: every change costs a relatively large amount of time and money. Investing in a new environment is a major upgrade for the manageability, security, and flexibility of the systems.
If you get it right, digital transformation will provide your company with many opportunities to perform better. Want to increase your chances of success? Then start with a solid strategy, because without a plan, results are difficult to realize. Also read: why having software made is a thing of the past.
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