The industrial revolution has deeply changed the 19th century’s society. Now, the digital transformation of companies is shaking ours. Companies might have some difficulties transitioning so, here’s everything they need to know about digital transformation management.
Digital transformation is the integration of digital technology into all areas of business, fundamentally changing how you operate and deliver value to customers. It’s also a cultural change that requires organizations to continually challenge the status quo, experiment, and get comfortable with failure.
The digital transformation isn’t a new concept because it exists since the rise of the Internet.
If the digital transformation management‘s notion is recent, it is because it came to replace the notion of digitalization. This last one was used since 2004 and referred to the last technological evolutions. The term « digital transformation management» goes beyond this concept and associates fully to the dimension of companies, considering technological innovations but also strategic and human dimensions.
The power of this mutation
Something that all the economic actors agree on, is that the digital transformation isn’t just a trend. It is a mutation similar to the industrial revolution’s which deeply changed our way of producing and consuming. It is surely even more powerful for two main reasons :
- For starters, it penetrates every layer of society. Every social class, every territory, every generation, every activity area… The strength is to note that the field of digital concerns everybody. Even if some are still estranged or worried, its adoption is just a question of time to be generalized. To prove this, there is a study published by Idealo. This shows that the 65-year-olds and over buy almost as much online as the 18-24-year -olds. In the UK, the elders consume even more than young people.
- On the other hand, the digital transformation undergoes the phenome of acceleration because of its appropriation massive by every one of us. This also forces companies to adapt to answer to the expectations of their own clients. So, the digital transformation is equally pushed by the companies who adopt it and pulled by the expectations of consumers who ask for it. A study by Deloitte on the digital economy shows that 65% of French buy online, whereas only 1 small business (<50 employees) out of 8 sells online.
So, the question isn’t if you have to have a digital approach but how could you integrate it into your activity? And how to start?
Digital transformation management of a company: How to do it?
Find a common ground
The transformation is a human question and without them, there can’t be a digital transition in the company. The first thing to have in a company that is digitalizing is a common vision. A common vision on the subject of digital transformation management.
You have to be able to educate and evangelize on the subject, before training your teams on the major axes of your company’s digital transformation. Human relations have a predominant role in this transition and it’s them who have to accompany the staff and answer to their needs and questions. It’s not a light matter, but a quick and effective transformation have to rely on humans and the common internal vision in the first place. The training will come after to make it possible for everyone to take their rightful place in the company.
Training is a must
Training is one of the axes on which you absolutely have to rely on. It is to upgrade all of your collaborators, especially those who are directly involved in the digital transformation management of your company. The offers are extremely numerous as well as centers focusing on digital courses.
So, we are talking about a very meticulous work that the RH has to do in intern, to drive the staff according to their needs. The use of digital tools, the big data, the project management, the innovation management, and the digital transformation management are subjects to mention when we’re talking about intern mutations. We can start with « the business management and digital transformation » as long cursus but there’s no doubt that there will be many more to come in the next years.
We can consider that all training treating the digital at large can be potentially useful. But you have to choose your training according to the company’s progress in the transformation.
Prepare for everything
The digital transformation management always comes with a lot of ground to prepare in intern. Hierarchy is often one of the firsts to come, but it is also the most complex one to overhaul from a human perspective.
To bring out ideas, skills … and refocus on the human, is essential in the context of digital transformation management.
Mobility is now one of the strongest symbols of digital transformation. It is precious in our daily life but also in our professional lives.
It suggests the disappearance in the short- or medium-term of the physical boundaries of the company or at least companies subjected to the global digitization of their activities and services.
Is this not already the case with telework, which tends to become more widespread as the digital transformation takes place? Other forms of work such as nomadism and freelance appear in their turn, replacing the way in which the traditional business operates.
A new source of information
The digital transformation allows companies to access an infinite amount of data on their customers, through the information we provide on the web: written messages, published videos, social networks, sites consulted …
This data can be retrieved internally or purchased from data specialists. Many companies are interested in this information because big data is in their eyes a gold mine to optimize their business model.
Digital marketing is one of the main pillars of digital transformation management. To improve their customer relationships, businesses rely on digital channels to promote or sell their products.
Of course, we can mention websites, mobile sites, social networks or even applications for tablets and smartphones.
But they also use digital tools such as emailing, natural referencing (SEO), the purchase of paid keywords (SEM), or SMS Pro.
Understand the opportunity
Just 31% of business leaders in France see the digital transformation as a real opportunity.
Yet understanding the mechanisms and challenges of digital transformation management is necessary for all companies that want to develop their business.
Because the digital transformation is in perpetual movement; it does not seem to want to stop, neither today nor tomorrow.
Development of the cloud, the Internet of Things, smart data, connected health, 3D printing, virtual reality or collaborative robotics, all technological concepts that shape our future life.
It is up to us to adapt to new technologies and not the other way around. Cradled in the world of new technologies, future generations should not feel the digital transformation. At least not as much as today’s employees.
The digital transformation goes further, because at a corporate level, in particular, it alters business models, as well as the relationship to the work of employees. And it is possible to identify through four pillars the digital company:
- The disappearance of spatial and temporal barriers: the digital transformation goes hand in hand with the notion of real-time, while it erases the distances between people;
- The ability to stay connected on the move, which facilitates telework within a digital society;
- The notion of the Internet of Things or IoT, with the meeting of the physical world and the digital world;
- And finally, the universality of the Internet, about which it should be remembered that the UN itself makes access to the Web one of the criteria for development.
Security of personal information
Regardless of the type of project involved, digital transformation forces organizations (companies, etc.) to think, prepare and even rethink their management of sensitive data.
Indeed, the digitization of a process (eg BtoC / BtoB sales monitoring, recruitment management, etc.) implies an increased exchange of data via an information system. This increases the risk of theft of sensitive data and cybercrime.
Companies must, therefore, revise their security policy and management of sensitive data (user data, bank card data, personal data/income, …). For this, they rely on national standards (CNIL, SAFE HARBOR, …), international (PCI DSS for credit card data, …) and on their own standards defined on the basis of their expertise and their understanding of their sector of activity.
Apart from the risks associated with managing sensitive data, one of the main difficulties for digital transformation lies in the ability to work together with people from different backgrounds, professions, objectives. There are web marketers, developers, traffic analysts, SEO specialists, social networking specialists (and other functions that are regularly created in the digital world), technical architects, CIOs, marketing managers, business / operational managers. Some are intended to develop an activity, an image, a business, a process. Others must ensure the security of the IS, the good ROI of digital activity, the operational risks, etc.
It is then necessary to bring together universes which are poles apart. Universes which have their respective specific vocabularies, which have different project timings with equivalent responsibilities.
To move forward calmly, a precise frame that clearly defines the objectives accompanied by a regular reporting (via a Dashboard) is necessary to all stakeholders to put all the chances on success’ side.
Porsche’s digital strategy is based on customer experience. They have invested a lot in customer and big data to understand better their drivers. Every consumer has an ID where every interaction is documented so, the company knows in advance their customers’ expectations and can satisfy it easier.
Alcon took a safer approach called “launch, learn, pivot”. This means that they started a transformation project in a smaller market to first learn without taking big risks, and then when they saw that it has worked, they moved onto the larger rollout.
BMW took the same approach.
Lego was at the verge of bankruptcy when they decided to turn to digital transformation. Instead of only making bricks and physical games, they started creating mobile games and applications, movies and video games. Now Lego is called “The Apple of Games” and they are one of the world’s most powerful companies.
Beauty retail chain Sephora has leveraged digital projects to not only survive but thrive in today’s retail economy, taking pole position as the no. 1 specialty beauty retailer in the world. The company has used technology to offer a number of unique offerings to customers on their mobile app as well as in the store, as I reported for ZDNet’s sister site TechRepublic. Right now, they have a Christmas’ promotion going on Snapchat where you have to go to a Store and with your Snapchat camera find to (digital) starts hidden amongst the shelves. You can win promotion when stars found.
Building a strategy is essential, but it only makes sense if it can be concretely broken down.
There is no miracle solution to becoming “digitally transformed” – by definition, it’s a continuous process
– but you can take advantage of certain tactics. They will also evolve over time, the innovations of today in front of the legacy of tomorrow.
A tactical approach to digital transformation management relies on the use of new tools and associated processes to achieve better results.
It is better to proceed then to remain a prisoner of yesterday’s inheritance.
If you’d like to find out more about LEGO’s success story, you can read our article about it.