Digital transformation is about embracing technology and finding new ways of working to address known issues or to support business growth. Many firms have already made in-roads to expand their digital capabilities, and technology plays a key role in most businesses.
That said, some firms are generally reticent to adopt new innovations for fear of jeopardising existing services. For others, a reliance on legacy infrastructure can be a major hurdle, which can seem like too big a mountain to climb. There’s also the associated cost and resourcing needed to manage and implement an effective change programme.
Necessity is the mother of invention and social distancing is motivating firms to move further into the digital space. New processes have been implemented in days rather than months, and even the most determined luddites are embracing digital opportunities.
Times of significant change always create new opportunities for growth, but they also present emerging risks that need to be carefully managed. Now is the perfect time to assess your digital transformation efforts and identify where those new opportunities lie.
Regardless of the industry, customers are used to services being available online, with round the clock availability. With many physical locations closed, apps and sites for shopping, banking, home delivery and entertainment are the primary means of service provision. Firms with an existing digital presence – one that is customer focused and intuitive – are seeing a surge in demand. These outlets drive customer acquisition and improve market share, while continuing to support business resilience. It is unlikely this trend will reverse and what works now is likely to be adapted in the long term.
With online and mobile interactions getting increased traction, it’s important to look around at what other businesses are doing and see what’s working, as well as identifying risks within the new operating model. Listening to customers on social media and other digital channels is vital to identify potential services and meet demand effectively.
First and foremost, digital transformation needs to reflect the business strategy, with decisions on short-term priorities providing building blocks for long-term goals. This will increase business value and support future growth, while reflecting the key elements needed for a successful transformation programme:
A strategic approach should be underpinned by clearly defined digital principles addressing consumer expectation, customer growth and keeping up with new technology. It should also assess how customer service and communications will be consistent across all channels to prevent a disjointed approach which can be alienating.
Understanding the competitive landscape is important for mitigating risk and identifying new opportunities for growth. This includes understanding how technology is evolving, how the workforce is equipped, and what that means for business, competitors and customer expectations.
An effective governance programme will measure and track the benefits realised from digital investments, particularly in a cost-constrained environment where every investment has greater scrutiny. This means looking beyond ‘traditional IT’ and understanding how the required investment in technology and skilled resources can help achieve business goals.
Monitoring digital channels can help firms understand customer acquisition, conversion and retention. Channel performance includes the use of content as a key component of the digital strategy and ensuring that content is effectively targeted by audience segment.
Customer experience should be consistent across all interactions with an organisation regardless of the channel, location, time of day or device. Recording every touchpoint with a customer and analysing that data effectively, can improve engagement levels and add value.
Looking at competitors and benchmarking operational efficiency can help firms understand the user experience and identify weaknesses in service provision. Online services benefit from automation for increased speed of interaction. Where there are gaps between customer needs and service delivery, processes should be in place to make and prioritise improvements.
Agile, streamlined IT functions are best placed to respond to evolving customer needs. An adaptable infrastructure becomes an asset in efficient change, particularly an ability to deliver at different speeds depending on the nature of developments. An IT function that links to third parties is best placed to scale up for future growth and service integration across all access points.
A ‘digital first’ strategy should be grounded in a robust cyber-security framework that actively aims to identify and mitigate risks. Information security best practice should be followed to reduce the potential for a cyber incident, and a cyber incident response plan should be in place.
Data is a key asset that can inform future business decisions and direction. An effective data analytics programme will need skilled resources to identify key improvements and provide a greater competitive edge. Data analytics is a valuable tool to draw information from multiple sources and build a more coherent picture of your customers’ needs and respond in a timely way.
As with any change environment, digital transformation relies on strong leadership from the top down. This includes embedding new ways of working and new technology across the organisation and using it encourage innovation and improve productivity. Investing in the right skills will support collaboration and promote effective dialogue across all teams. Interactive delivery cycles, such as agile, lean and DevOps methods should be used to maximise value.
The above list summarises what good looks like in the long term and it’s important to recognise where your business is in the digital transformation journey. Right now, many digital activities are a rapid response to social distancing and finding new ways of working. What’s important is that you can create a framework to develop into the long term, building on each area over time to create a mature digital assurance framework that works for your business.