What is Digital Transformation? (And Why You Should Care) - Splice Digital

What is Digital Transformation? (And Why You Should Care)

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Executive discussing Digital transformation strategies

There’s a revolution happening throughout the business world. Whether by choice or by necessity, companies in every industry — from finance and consulting to manufacturing and E-commerce — are turning to ecosystems of digital technologies and integrated strategies to drive change and better compete in the market.

In this post, we’ll cover:

  • What is digital transformation
  • Reasons businesses invest in digital transformation projects
  • The digital transformation process

From Disruption & Disorder to Smart & Streamlined

The current rate of business innovation is possibly only outpaced by the shifting of customer demands and market landscapes, and the unfolding of current events. With the breakneck speed of change, things are going to falter, experience shortcomings, or become outdated.

That’s the nature of life and business! You’ve probably experienced some of this in your own company.

Today, everyone’s feeling the pinch of interruptions in supply chains, data security breaches, worker shortages, and so on. On top of these considerations, technology is advancing and proliferating at a pace than can make it difficult to keep up - leaving businesses caught between the feeling they must innovate to stay competitive, and the fear of the 'bleeding edge' which is often grounded in the institutional memories of technology projects gone awry.

So, What is Digital Transformation?

Digital transformation (DX) is business transformation. DX leverages digital technologies and accompanying strategies, procedures, human resources, etc. to create or modify business processes, systems, environments, or outcomes.

There are countless manifestations of digital transformation. This is because it’s so dependent on the organization in which it’s being implemented. Each enterprise has its own set of goals, stakeholders, inputs, culture, strengths, etc. So, what DX might look like in one business is likely to be different than in another.

Let’s Talk Tech for a Sec

Technology is central to any modern digital transformation undertaking. Not all tech is the same — with DX you have options.

DX & SaaS

If you aren’t yet familiar with the term SaaS (software as a service, aka web-based software, hosted software, or on-demand software) — you’ll definitely want to get yourself up to speed on it. It’s a huge component of digital transformation.

SaaS is a model of licensing and delivering software. The software is hosted in the cloud and managed by the provider.

Access to and use of the software is permitted to the purchaser, often as a subscription. You might use it via the internet or an app.

Some common examples of SaaS software used in the business sector include many:

  • CRMs (e.g., HubSpot, Salesforce)
  • Social media management systems (e.g., Buffer, Sprout Social)
  • Database hosting services (e.g., AWS)
  • Office productivity applications (e.g., MS Office 365, G Suite)
  • File hosting services (e.g., Box, Dropbox)
  • Content and creative asset creation (e.g., Lumen 5, Canva)

As you can see, SaaS is pervasive. Whether you know it or not — you probably have at least a few SaaS applications helping you run your business. In fact, most mid-market to enterprise companies actually use 10s to 100s.

This is a trend that’s expected to continue and grow for companies of all sizes.

Businesses, and the environments in which they operate, are getting increasingly complex and sophisticated. They need tools that can keep pace. And the SaaS model is popular (and profitable) among solutions providers. Because of this, SaaS will likely both drive and serve digital transformation.

An infographic showing the number of SaaS apps used worldwide and average spending by companies

DX & On-Prem Solutions

Like SaaS, on-premises applications are created and sold by a provider. There are two main differences, though. For on-prem products:

  1. The software, and any necessary hardware, are hosted at your company’s site. Your IT team would be the ones managing the infrastructure and other aspects of the software.
  2. You may only have to pay once for the software and then you own it (though the licensing agreement can put limits on ownership terms).

There are many on-prem solutions available today. However, many providers that used to offer on-prem products have moved to the SaaS world.

DX & Custom Digital Solutions

SaaS and on-prem solutions are great, and there are myriad options on the market. But, sometimes they just aren’t the right answer to a company’s needs. Enter custom solutions.

Custom digital solutions are bespoke software (and yes, there are bespoke owned SaaS), apps, and digital systems that are designed and built to address a company’s particular requirements in a specific way.

Interestingly (and smartly), companies often use a combination of out-of-the-box and custom digital solutions. Custom solutions are also a terrific way to connect multiple SaaS/on-premises products or fill the gaps between SaaS/on-premises products you’re using. For example, you might drive business transformation through custom “connection” software that links and shares data between two SaaS systems to streamline a process or to create a top-line KPI reporting dashboard to empower better decision making.

DX — Not Just About Digital Technology

Yes, the tech is a central element to accomplishing your desired business transformations and downstream results.

However, digital transformation is about more than just hardware and software. It’s about an all-encompassing conceptualization and implementation of appropriate strategies, processes, people, resources, data utilization, and even mindsets. By addressing the five Ws of the business-critical tasks at hand. digital transformation evolves the heart and soul of your business.

This can take the form of broad organizational evolution with multiple touch points (e.g., enhanced workflows across departments, consolidation of data for reporting). Alternatively, it can be a narrowly-focused but essential advancement in a single area of your business. For example, you could digitally transform an operational process that drives a significant competitive advantage or reduces costs. Big or small, one fell swoop or iterative, DX can better align — and capitalize on — all your resources to help your business thrive.

Reasons DX Makes Good Business Sense

Digital transformation isn’t simple and speedy. It typically isn’t an inexpensive endeavor (yet can be in targeted initiatives). Change of any kind has its challenges. Most companies don’t embark on business transformation lightly.

So, what makes the effort and investment worth it?

Each company has its own unique reason or set of reasons for overhauling one or more areas of their operations. But, here are some common “whys” — that your own business, or your client's business - may relate to.

DX can enable a company to be better at:

  • Finding and converting prospects
  • Satisfying and nurturing customers (retention!)
  • Streamlining operations
  • Boosting productivity
  • Shortening turnaround
  • Simplifying processes
  • Optimizing inventories
  • Facilitating resource planning
  • Analyzing business performance and deriving actionable insights
  • Generating profit
  • Minimizing expenses
  • Aligning with modern business practices and systems
  • Changing company culture and lifting morale
  • Adjusting to market demands or constraints
  • Adhering to regulatory guidelines
  • Outshining competitors

It comes down to hitting some sort of inflection point. A decision to move in one direction or another is reached — and you have the option to move forward in ways that are most optimal for your business’s needs and goals.

Digital transformation process description from solution design to solution development

The Digital Transformation Process

Knowing what DX is and why it can be a smart move for your business goes a long way to informing what the digital transformation process might look like. However, as we noted earlier, DX is going to be different each time it’s done. There are too many levers that can be pushed or pulled.

DX, Step-by-Step

That said, most digital transformation projects will share some fundamental steps, such as:

  1. Discovery. The scope and nature of the business challenge you want to digitally transform are determined.
  2. Planning and design. A project roadmap is established and the solutions are ideated and architected.
  3. Building and deploying. The solutions — SaaS and custom technologies, strategies, processes, etc. — are created and implemented. Training and documentation are done.
  4. Ongoing maintenance. You’re performing checks, upkeep, and so on to ensure the proper functioning and continuity of your transformed systems.
  5. Enhancements. Technology evolves and updates, improvements and new features will be needed. By integrating more processes and data sources over time, you can help your business stay ahead of the game.

Managing Digital Transformation

You can certainly do this on your own, with an in-house team. But, many companies find this is too far outside of their wheelhouses to do efficiently or successfully. It requires consultative skills in business process optimization, and deep solution-design experience  - abilities that are often not a strong suit of even very talented and reliable IT departments.

In that case, engaging an external partner is advisable. Hiring a firm that specializes in digital and business transformation — like Splice — can save you time, effort, frustration, and money in the long run. Your odds of ending up with a superior result could skyrocket.

Splice, the Digital Transformation Experts You Need

Don’t let the idea of digital transformation overwhelm you. You’ve got access to leaders in this field, right here. As experts in helping businesses in every industry imaginable improve their operations and bottom lines via digital transformation, Splice can help you succeed, too.

Better Your Business, Starting Now

Contact us today to learn more about how we can help evolve your business.

Frequently Asked Question, Answered

What is digital transformation?

Digital transformation (aka DX) leverages digital technologies and accompanying strategies, procedures, etc. to create or modify business processes, systems, environments, or outcomes. 

What is designing for adoption?

Designing for adoption is an approach to business transformation that considers and addresses  all aspects of the processes, people, operating environment, and so on that could impact the success of the transformation. The overarching goal is to create an optimal transformation that a company will actually implement and use.

How can I ensure my digital transformation initiatives succeed?

We can help you succeed and there’s a lot you can do to help ensure positive digital transformation outcomes- like allocating necessary resources, assessing your needs, and proper planning. And, of course, embracing a design for adoption approach!