How Important is Digital Transformation?

disclaimer: this article may or even not be relevant to your business, this article is based on my experience doing somewhat called “digital transformation” for my company or my client which is mostly not a high-tech company, and technology not playing as a main role in their business.

After several years working in the tech industry I found that digital transformation has always been a tough task for many executives. many technology buzzwords that you might hear like AI, cloud computing, edge computing, or even Metaverse. The picture below shows top technology trends by Gartner.

you may hear one of these 10 words or even all of them. These words might be sounds very powerful and can help foster your company's performance by reducing the cost, streamlining the process, avoiding fraud, increasing revenue, and many other things.

several years ago I talked to someone who owned a “traditional company” that wants to invest a bunch of money in an AI camera that can track and map customer behavior inside his store. this thing sounds promising because it might help the company to know more about customer behavior and with some beautiful sales deck about the camera that can improve revenue by XX%. He might not consider how customer behavior data can be converted into insightful data, he might not consider there is some other important stuff that might be useful rather than investing a bunch of money for an AI camera that may not be used in daily operation since the store doesn’t have proper internet access.

According to Harvard Business Review articles, 70% of effort in digital transformation fails. this is due to a lack of the right mindset and current organizational flaws. Digital transformation is not easy as investing in cutting-edge technology or hiring a bunch of IT professionals from top-level companies to bring big-bang changes to your company. there are several things that need to be considered during the digital transformation process:

what are company goals?

every company will have different goals hence is important to decide where the technology plays in your company. you can use some matrix like McFarland Grid or any other matrix.

How do we want to achieve the goals?

start to think about how to achieve the goals using some technology and do some research about how similar companies use that technology to foster their business. if you have more than one goal, don't be afraid to prioritize it. you might not have enough resources to achieve all those goals at the same time. it’s okay to slow down and not pursue all those goals and focus on achieving more important goals for your business.

What technology we can use?

Nowadays there are many companies that offer various solutions. For example, if you want to implement ERP there are many providers like SAP, Oodoo, or smaller ERP providers, or even you can make your own ERP. make sure that the solution you want to choose is the one that you need. because investing in IT solutions might not be cheap at all we also need to see the current company situation which will be covered in the next point. I always use this illustration to show that sometimes we don’t need some fancy things but we have to find the ones that we need and suit our company.

Why do we need this technology? how important (or urgent) it is? can we afford it or not?

start to see your company's current condition, many decision-makers are FOMO when their rival or their relatives start to implement high technology stuff. this mindset can be dangerous although we need to make the business stay up to date, we must know that the technology that we want to use is really helping us to achieve the company goals. after that we have to rethink when to implement that technology, do we need it ASAP? or might there other important things rather than investing in IT stuff first? Is our company ready to adopt new technology and accept its side effects?

for example, when we want to implement a complex system like ERP that might be worth millions of dollars of investment. we have to consider many things, is the system can accommodate your business process, if the infrastructure in your company already supports it? do you have a sufficient amount of money and commitment to implement this system?

How do we want to implement it in our company?

after thoughtfully considering what technology you want to use, and when to implement it, you also need to consider how it will be implemented in your company. many projects fail when they don't carefully consider how to implement them. it might be from various aspects like infrastructure, money, people, etc. Starting to think how it will be used in day-to-day in your company.

Make sure that the technology is helping you to achieve your goal

you need to know if the technology is really helping you or not. this is quite important after investing some money you want to know how your investment pay you. if things go wrong you have to think about how to make things right (do you need some adjustment? or do you need to add other things to support it?). don’t get buried in your hope, hoping that your investment can last forever or your company will benefit right away after implementing new technology. you react properly to the technology that you invested in.

Lastly,

Business and technology are 2 things that cannot be divided. digital transformation is a must thing to do to make your business stay relevant in your industry. using technology to support your business is quite essential or even you can use that technology as your business. however, it is important to ensure that you know what you invest in and how to use it, or it can bring new nightmares for your business. try to discuss with some professionals in this field to help you digitalize your business, it will be very helpful and can give you some other views that you might not see at the first time. keep in mind that you might not need to be rushed to make this important decision.

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