Digital transformation is the process of using business technology to do things differently. It’s often a response to some kind of change or challenge—like meeting customer expectations, boosting flagging sales or adapting to a competitive threat.
Many companies take on digital transformation because they have to—it’s a matter of survival. Others find that new workflows and capabilities can give them a strategic advantage over their competitors. Either way, the key to success is being able to constantly move the organization to higher levels of performance and capability.
Embedding digital technologies into products and services can help companies create valuable, innovative solutions that address specific challenges. The resulting digital economy can deliver on the promise of creating new business opportunities. Examples include the use of wearables, electronic health records and intelligent case routing systems in customer service.
Another important aspect of a successful digital transformation is connecting metrics to real-world outcomes. It’s easy to get caught up in the hype around vanity metrics (login counts, for example), but digital transformation teams should focus on outcomes like cost savings, cycle time reduction and revenue impact.
Some industries have been early adopters of digital transformation, while others are still finding their ways. Every industry faces its own unique set of challenges and opportunities. For instance, financial services firms face regulatory compliance requirements, rising competition from fintech companies and demand for digital-first banking products. They also need to leverage automation, data analytics and artificial intelligence.
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