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There is no denying that we live in a largely digital age. But even as technology continues to develop at a rapid pace, many businesses continue to lag behind in adopting and properly implementing such tools.
In fact, surveys have indicated that as many as nine out of 10 companies struggle to implement emerging tech, despite overall sentiment that companies that take a “wait and see” approach to AI and other tech advances are at an increased risk of being left behind their competitors.
For many brands, such trends make undergoing a digital transformation essential for securing their company’s future. I recently had the opportunity to speak with Sushil Kumar, a widely recognized digital transformation expert with AgreeYa Solutions who has extensive experience piloting diverse technology solutions in the defense, banking, insurance and airline industries, having effectively led multiple organizations through the application modernization process in his past assignments at IBM and the Indian Army.
As his insights reveal, few things can have a more powerful impact on brands today.
What is a digital transformation?
“Digital transformation is the process in which an organization integrates digital tech into all of its operations,” Kumar explains. “This can require a significant cultural change because it impacts every aspect of how the company does business. This may require a lot of work, but the end goal is to replace outdated methods and systems and embrace a more efficient, productive and agile approach to doing things.”
Even as stories about AI applications have dominated headlines, many business owners lag behind in tech adoption. Surveys of small business owners have found that less than half use technology outside of accounting, with sizable minorities also using tech for booking appointments and customer relationship management.
However, as Kumar notes, digital transformation implies that such tech will no longer be an outlier that is only used for a few specific functions. Instead, it must become a fully integrated part of all business activities.
Why digital transformations matter
To Kumar, the importance of digital transformations largely comes down to a few key factors: increased capabilities, improved efficiency, and greater organizational agility. “Today’s technology is uniquely positioned to help businesses become far more efficient in a wide range of areas,” he explains.
“From customer relationships to supply chain operations, tech provides instant visibility and access to insights that you wouldn’t have otherwise. This allows you to respond faster and more effectively to deliver better results to your customers.”
Such improvements are especially important at a time when going digital has become the standard for many consumers. “We live in a market where disruptions are the norm,” Kumar says.
“The COVID-19 pandemic accelerated the consumer shift toward digital, while also changing the nature of how and where people work. Digital technology is central to our everyday lives outside of work — so it makes sense that people expect to have similar experiences with the brands they engage with and the companies they work for. At its most basic level, digital transformations are necessary because they are what we have come to expect.”
The pandemic is a prime example of the real impact digital transformations can make. The IMF reports that higher-digitized sectors were able to reduce losses in labor productivity by 20% compared to their less-digitized peers during the height of the pandemic.
While with IBM, Kumar spearheaded a team of cross-functional subject matter experts to accelerate the strategic digital transformation initiative of a leading multi-national insurance group by identifying customer needs followed by an agile implementation. Customers were looking forward to new AI-driven experiences, but legacy applications on traditional IT systems limited capabilities.
Disparate systems resulting from multiple acquisitions further restricted digital transformation opportunities. The new initiative led to a much-improved user interface that provided on-demand services to consumers based on their feedback, improved the platform’s security and leveraged cloud capabilities to reduce operational costs.
How to ensure a successful transformation
While digital transformation is essential for any organization, it’s important to remember that this doesn’t imply a one-size-fits-all approach to adapting your organization’s practices and culture. “Successful digital transformation starts with a clear goal,” Kumar explains.
“You can’t just add technology for the sake of adding technology. You need to think about what problems you need to solve for your business, as well as what opportunities you need to create. Understanding how these goals and use cases align with your greater company culture is key to ensuring that you make the right type of transformation — one that truly enhances what you have to offer.”
With culture-aligned goals, you can build digital technology solutions and find digital partners that work for your teams. This can be especially important when leaders receive pushback about certain elements of a digital transformation initiative. Demonstrating the value delivered by different applications and showcasing how they align with the culture will prove key for garnering buy-in.
For example, Kumar led another critical program at IBM, transitioning and transforming the IT operations of a leading bank in Australia as part of its strategic shift to digital-first banking. This required sensitively managing multiple teams across different company cultures while engaging with senior client executives to ensure collaboration at all levels to create shared success throughout the organization.
Of course, many organizations can feel overwhelmed at the prospect of a digital transformation, being left uncertain about where they should even start. However, by defining your goals early on, you can then clearly articulate your pain points and what you’d like technology to accomplish. This will also make it easier to establish key performance indicators that will help you measure the return on investment as you continually reevaluate your transformative efforts.
Future-proofing your business
“Undergoing a digital transformation is essential to preparing your business for the future,” Kumar says. “With the right tools and systems adapted to your needs, you’ll be better equipped to serve your customers and get better results from your team. You’ll unlock new opportunities to innovate and work more efficiently. And most importantly, you can ensure you won’t get left behind.”
While technology will undoubtedly continue to evolve in the years ahead, undergoing a digital transformation now will give your organization the agility, flexibility, and experience needed to embrace essential changes and achieve even greater results.
