11 Important areas for effective Digital Transformation

Digital Transformation framework and digital value chain deployment is a huge effort for large organizations as there are too many factors to be taken care for becoming successful.

Organizations’ depending on their size need a multiyear program to full achieve the transformation. For smaller and medium size organizations it is relatively simpler to achieve due to their smaller size and much lower complexities involved.

Alongside the Digital Transformation Framework, we must ensure entire digital value chain (value stream) is well equipped to function smoothly. This requires taking care of following 11 important areas while doing digital transformation of your digital value chain,

Important Areas of Digital Transformation
Important Areas of Digital Transformation

1.     Stakeholder Needs – Identify, Involve and Evaluate that all your stakeholder needs both internal and external are met. This must include your partners (e.g., suppliers, supply chain, marketing agencies etc.)

2.     Digital value chain – Clearly articulate your digital value chain. Define and measure your expected outcomes. Easier said than done, this will take a lot of efforts from all in the organization, especially leaders and management team. Focus is not just on what is the value chain but on what outcomes you want to achieve, for whom and how it will be measured for success.

3.     Competition – Evaluate what your top 3 to 5 competitors are doing and how digital transformation can give you an edge over them. Also, to maximize results, check where your specific industry or market is going and align to it. Use market research and industry papers from top consulting firms and government.

4.     Digital Work Culture – Define and Design work culture changes needed to adapt the digital mindset across the organization. Digital transformation is much more of work culture change then simply changing systems and processes. To be digital the culture must have aspects of digital behaviors embedded and articulated with examples.

5.     Balance Digital Capabilities – Ensure proper digital technical capabilities are in place with a good balance of inhouse and external resources/partners to deliver and run the ongoing digital journey. Also do a check whether your partners (SCM, Suppliers, Retailers, etc.) are well equipped to move in the digital space. There is no point having digital transformation done while rest of your ecosystem is not ready to adapt.

6.     Digital Capabilities Readiness – Establish full set of digital capabilities in terms of people, process and products. The emphasis here will be on people, to check and ensure digitally trained people are onboard to manage the value chain. Existing people can be trained. New people or positions should be opened and hired (e.g., if you don’t have digital marketing leader, you will need one for sure, you don’t have digital data analysts then know that you will need them too). HR must have a Digitally savvy TA Manager that really understands Digital needs and how to acquire the right talent. Lastly there has to be a good balance between how many people you really need inhouse and how much you can manage using your external partners (for Manufacturing, Marketing, SCM, Finance, Procurement, HR and IT).

7.     Partners are important – For digital transformation to be successful all your partners (e.g., suppliers, supply chain, marketing agencies etc.) must be fully onboard and equipped to move towards digital ecosystem. Often partners technical capabilities and system landscape standardization and connectivity for seamless transactions management becomes a major issue. This is one of the most challenging areas where organization’s core systems are not seamlessly connected using industry standard messaging platforms resulting in lot of manual work and Lean waste if not identified and handled in advance as part of the transformation. Challenge is generally faced with manufacturing suppliers, supply chain partners and eCommerce hub (shop in shop) partners.

8.     Big Data and Insights – One of the other major areas to watch out are related to Data and Insights. Going Digital means, the organization will now have a lot of data in various systems and these data must be used to generate meaningful insights using near real time online dashboards. Key value indicators (KVIs) and Key performance Indicators (KPIs) as well as various aspects of industry 4.0, digital marketing and online sales must be well defined and measured for growing the business and creating sustainable value.

9.     Compliance – As you embark on the Digital value chain, all the compliance needs must be redefined as per the digital value stream. Data privacy and online compliance regulations from global as well as local country specific compliance must be fully acknowledged and implemented.

10.  Digital Command Center – The more digital the organization becomes the more the organization would need digital command centers to check and manage their online presence and customer touchpoint platforms (likes of company websites, campaign websites, facebook, youtube, twitter, Instagram, Pinterest, LinkedIn and many more). One mistake on these platforms can cost a lot to the organization and its brand image globally (e.g., it can directly impact share prices).

11.  Cyber Security – Going digital brings a lot of positives but it also has its own negatives. If systems are not well architected and digital platforms are not secured with cyber security. System authorizations and authentications must be handled with end-to-end encryptions. All people must be trained in understanding basics of cybersecurity related to use of strong passwords, keeping the devices locked when not in use, authorizations are maintained and segregation of duty conflicts are vouched to ensure right people get right information (nothing more and nothing less). All servers, devices, systems and digital equipment are periodically scanned and patched for avoiding virus attacks and hacking.

Digital Transformation is like implanting a new brain in the organization (body) to make it more effective and efficient while still keeping its vision & purpose (soul) intact. Digital transformation helps to change the strategy of an organization on how it can unlock its full potential to achieve its vision, purpose and goals (north star).


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