Digital Transformation is a well-used but often less well understood term in the technology sector. There are many interpretations of what it means, and it can be confusing for many, as it is a wide-ranging topic; so, before we look at the challenges and opportunities, let’s define what digital transformation is.
Too often, digital transformation is either too broad or too narrow in its explanation, meaning it runs the risk of being relegated to a buzzword. There are many definitions used which range from:
“Digital transformation is the adoption of digital technology by an organization to convert analog processes to digital processes. “– Anonymous Source
to the one that made the most sense from my perspective -
“Digital transformation is the process of using digital technologies to create new — or modify existing — business processes, culture, and customer experiences to meet changing business and market requirements.” – Salesforce.com (n.d.)
If all you’re doing is promoting analog processes into digital ones, that’s digitization (from Maltaverne below).
Digital transformation must consider the essential components of process and people.
Image: Digital Transformation process based on Maltaverne, 2017, Bumann, J., & Peter, M. (2019)
If a Digital Transformation project does not include organizational change management, addressing change to business culture and human experience, you are not engaged in a digital transformation project. Making a process 85% more efficient which never gets adopted, offers 0% business value.
Why Do it?
“Why” is the most critical question when kicking off a digital transformation project. What is the purpose? Many companies will tell you that they look to improve quality and reduce product development or service delivery costs. Others are looking to create new revenue streams. If this sounds like you, the following graphic might be surprising.
Image: Top Benefits of adopting a digital model. Eira, A. (2022, January 14)
75% of digital transformation projects want to improve operational efficiency or to meet changing customer expectations. There’s enormous value in these two categories because they’re focused on people and process costs.
In our service-oriented world, customers have more choices than ever before. Therefore, managing customer experience and improving satisfaction and retention are critical considerations. Moreover, connecting with your customers where they are located has become the easiest way to retain them. Making it easier and more convenient for customers to buy, sell, get support, and interact with your business is what keeps a customer satisfied. Customers demand that same consumer experience in the B2B world, as Forrester confirms in a recent report:
“Increasingly B2B buyers expect B2B sites to mirror the easy-to-use consumer sites they go to for personal buying… B2B customers are also B2C consumers. If they have a B2B website open in one window, they also have their favorite B2C website open in another window — and it's almost always more visual, easier to use, and more relatable.” Forrester, B2C (Still) Sets the Standard for B2B. (Feb 21).
Whilst adoption by myriad users is a risk to success, the most important hurdle to climb in digital transformation projects is C-Suite approval and support.
Image: Who is holding back companies’ digital transformation initiatives? Eira, A. (2022, January 14).
At the beginning of nearly every project, there is a project manager somewhere identifying the risk of adoption across the organization. The key to success is to ensure every level of the organization is supporting the change, crucially from top to bottom.
So, what can you do to alleviate the challenges? If your primary goal is to introduce a new revenue stream without addressing the top two benefits of ways to improve operational efficiency or to meet changing customer expectations, then success will be challenged; adding workload, increasing costs, new employee training, high expectations from senior management and risking poor customer satisfaction are some of the critical factors to consider.
Having tangible, verifiable metrics, defined at the beginning, is the best approach to succeed in any project. What metrics are we going to judge success/fail against this project? Always remember that a digital transformation project is primarily about people. Have achievable milestones demonstrating incremental value, then measure and review, iterate and look for continuous improvement. Furthermore, managing user experience is a challenge to get right at the very start. It is highly likely than those adjustments will be needed in the release stage. Prepare and budget for this critical phase.
Read this blog to learn more about the biggest hurdles to digital transformation in organizations.
Digital Transformation projects are some of the most profound and enjoyable projects to take part in. Seeing how much you can improve the lives of your employees and your customers in tangible, measurable ways is extremely rewarding. However, to get the value out of this type of project, you need to bring all the people in your organization on the whole journey.
To learn more about the success factors in Digital Transformation in waste & recycling read this blog.
AMCS Platform is designed to help waste, recycling, logistics and utilities companies increase efficiency, reduce costs, and embrace greater automation through digitalization. View AMCS Platform demos here.
Learn more about the AMCS Platform here or download the brochure below.
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