In Every organisation are needs to accelerate their digital transformation to effectively complete and stay relevant to customers. This requires changes in metrics, in organizational structures and in the technology platform that enables this transformation. While such a viewpoint may have been controversial five years ago, it is certainly not the case today as digital transformation is a key item on the agenda for C-suites, boardrooms, and even governments.
Race to transform
It clearly showed that there will be widespread disruption to the traditional business and operations models of all organizations approximately 60% of India’s GDP will be derived from digital products and services by 2021, created directly or indirectly using technologies. In comparison, only 4% of India’s GDP today is derived from digital products and services. This is the speed of change that all organizations must grapple with.
Imagine that you are operating a chain of restaurants and use tablets to take orders to enhance productivity. While it is a step forward for digital transformation, we cannot entirely say that the restaurants’ sales are derived from digital products and services. By contrast, in 2021, a physical restaurant may not exist. Orders may be predicted by artificial intelligence (AI) beforehand, and ordered via virtual reality, the cook may still cook the meal but assisted by robots, and the meal delivered by drones. This transformation can be then regarded as a contribution to digital revenues.
The study has shown that organizations are seeing significant and tangible benefits from their digital transformation efforts today. The top five digital transformation benefits that organizations experienced include increased profit margins, productivity, customer advocacy, loyalty & retention, cost reduction, and revenue from new products and services. Even more interesting is that these digital transformation benefits are set to grow by 40 percent in the Indian market in three years.
Most organizations find it difficult to achieve operational efficiency without compromising on quality and customer experience. Companies looking to accelerate their digital journey need to achieve time and cost efficiency in their regular business operations so that they are a step closer to their transformation goals.
Winners take it all
When I speak with industry leaders, I don’t get a uniform sense of urgency about their digital transformation journeys. Some leaders prefer for others to be the trailblazers, and then to learn from these digital transformation pioneers. The question that I often ask myself is this: “Is digital transformation a race where the winner takes all?”
The study also shows that the pace of transformation makes a difference, much like how an efficient pace is key in raising your chances of winning a long-distance marathon. We have classified the organizations participating in the study as ‘Leaders’ and ‘Followers’ based on a few factors: The maturity of their digital transformation strategies; proportion of their digital income; and level of benefits achieved from digital transformation initiatives. With these filters applied, only 7 percent of organizations in this study can be classified as leaders.
More importantly, the study has shown that leaders reaped the highest digital transformation improvements to the tune of more than double the benefits from digital transformation compared to the followers and the effect is expected to be more pronounced by 2020.
We are already seeing digital leaders, across all kinds of organizations, in action.
SBI – It is the largest bank in India is rapidly undergoing digital transformation across its network of 23,423 branches, enabling over 263,000 employees and servicing more than 500 million customer accounts. The bank chose Office 365, the cloud powered productivity solution from Microsoft to improve communication and collaboration among its workforce and transform itself into a modern workplace. The bank will derive benefits from this digital transformation in three phases; making itself agile by rapidly upgrading to cloud based technology, focusing on user adoption by identifying use cases based on work profiles, and transforming business by process alignment with the new tools, all of which together will ultimately enhance, both, branch and customer experience. Rajnish Kumar, Chairman, SBI, says in this context, that to be well-equipped to address dynamic market pressures and rapidly evolving industry needs, it is imperative to transform technologically and make digital transformation a part of SBI’s DNA.
PaisaBazaar – Paisabazaar.com has worked extensively on futuristic technologies like artificial intelligence and machine learning. It will help identify customer needs more accurately, factoring in their lifestyle and life-stage and will expedite the processes on the PaisaBazaar platform through further automation and digitization, in line with its philosophy of creating ‘paperless’ and ‘presence-less’ processes. It will build innovative features like chat-bots, image recognition, voice analytics and language processing to take the customer experience to the next level.
Learnings from winners
So, what lessons can these digital transformation leaders provide from this study? These are four recommendations for organizations to help them succeed in their own digital revolutions:
Create a digital culture: Culture is the multi-layered core at the heart of every successful organizational digital transformation. In an increasingly digital world, a digital culture cannot thrive if an organization operates in silos with disconnected or under-connected business functions.
Build an information ecosystem: In a digital world, organizations have access to more data than ever before from both internal and external sources. Both the opportunity and challenge are to bring all that data together, to analyse that data, and then use it in ways that contribute to better decision making and better outcomes.
Embrace micro-revolutions: In most cases, digital transformation efforts do not start with an organization wide plan of change, but rather, with a series of micro revolutions. These are small, quick wins that deliver positive business outcomes, and at the same time accrue to bigger and bolder digital transformation
Develop future ready skills for individuals and organizations: Organizations today must relook at training and reskilling its workforce so that talent is equipped with future ready skill sets such as complex problem-solving, critical thinking and creativity for the digital economy.