This “Outside Consultant” column by Opus College of Business Marketing Professor Gino Giovannelli ran in the Star Tribune on Oct. 19, 2020.Digital transformation means different things to different people. I describe it as using digital advancements, like technology, processes, marketing, e-commerce, etc., to positively transform how a business goes to market.
It breaks down to two main groups, the enablers and the touch points. Enablers are things like workflow processes, supply chain management and technical platforms that make digital transformation happen. The other group is touch points where digital transformation comes in contact with consumers, such as digital marketing, point of sale for brick and mortar businesses, self-service kiosks and e-commerce via websites and apps.
And woven into both are people, who ironically are the ones driving the change, but are also the ones most often holding it back because of resistance to the very change they want to see.
Case in point, according to a Capgemini study, 87% of companies say that digital transformation offers a key competitive advantage for businesses, of which according to Forbes, 70% of companies either have a digital transformation effort in place or are working on one. But according to an Emerson study, only 20% of respondents had a vision and a clear and actionable road map for the digital transformation effort. And the lack of an actionable road map is on us, which may account for why over 70% of digital transformations fail (Everest Group).
But for companies that commit to the digital transformation journey, the upside is significant. For example:
- For product management, digital transformation helps companies incorporate customer needs and trends more quickly into new product concepts and shortens product development cycles to decrease time to market.
- For supply chain, digital transformation offers more sophisticated ways of tracking local consumer trends to maintain proper inventory levels in store and online.
- For marketing, digital transformation helps companies offer a more targeted and integrated approach to using digital marketing channels in a complementary approach (omnichannel marketing).
- For sales, digital transformation offers the ability to shift sales online to reduce reliance on in-store sales, especially during a pandemic when access to physical stores can be hindered.
While digital transformation can mean different things to different people, one thing is for sure, most businesses need it.
Gino Giovannelli is a marketing professor at the University of St Thomas Opus College of Business and is co-host of the podcast series “In the Key of D – using DIGITAL to transform your business.”