4 factors driving digital transformation in your business
It’s no secret that digital transformation is a must for businesses. If you’ve been on LinkedIn lately, you’ve likely seen more than one post related to Artificial Intelligence and how it could change everything that we do.
But how much do you know about digital transformation? Yes, adopting technology can help your business perform more tasks more efficiently, but do you know which factors drive your business to adopt new technology?
In this post, we answer these questions to help you build a better understanding of how strategic digital transformation can assist your business to stay competitive and create new revenue streams.
Digital transformation: a definition
Digital transformation isn’t limited to business – it’s happening all around us. Think about what life was like before the iPad. While it’s hard to imagine a world without Apple products, the example of how the iPad transformed the way in which people communicate, entertain themselves and conduct business, is a good one.
Digital transformation is the change associated with the application of digital technology in all aspects of human society.
For business, this means applying technology to enhance the way your company operates.
Factors that influence digital transformation
There are four main factors that influence digital transformation: technology, customer behavior, innovation and the business ecosystem. As a business leader, you’ve likely explored ways in which some of these impact your business, however it’s also possible that seeing the link behind these factors was difficult.
Here’s a breakdown of each factor:
Technologically-induced change is the most popular factor today. Businesses are using technology to perform many online marketing tasks and to automate activities previously assigned to people.
A recent example that’s caught the media’s attention is Amazon’s use of robots in its warehouses. According to reports, Amazon has around 45,000 robots operating in its warehouses and aims to add almost 15,000 every year.
For the ecommerce titan, robots presented an opportunity to streamline their warehouse operations.
When you think about how technology can play a part in driving more efficiency in your business, ask yourself what activities in your operation can be streamlined, and then explore the available options.
Changing customer behavior and demand
Customer-induced transformation is related to technology, yet isn’t necessarily driven by it. For example, when prepaid electricity meters were introduced, the only way you could purchase prepaid electricity was by taking a trip to your nearest supermarket. Later, online portals and banks started offering customers the opportunity to purchase electricity online and through mobile applications.
This shows that ease of access, via the internet, made online purchases a more favorable route.
Innovation takes the form of new ideas and approaches to challenges that your business faces daily.
For example, in 2006, clothing brand Burberry was in a difficult position. High costs, a scattered manufacturing base, product proliferation, and an inconsistent global pricing strategy, began to take their toll on the business.
Despite these factors, the company’s most pressing problem was the state of its brand. The company’s image had been hijacked by so-called ‘chavs’, a kind of lower class ruffian.
After several years of declining revenues, a new CEO, Angela Ahrendts, was brought in with a vision to digitally transform the company.
Burberry bounced back by introducing innovative ideas and major changes to their business model. By targeting millennials, shifting the company’s revenue focus to Asia and other emerging markets, introducing iPads as a tool for instore sales assistants, and committing to social media in a big way, they took back control of their brand and made it profitable again.
A changing ecosystem
Economic changes can cause large shifts in industries. For example, Brexit is one such challenge that many businesses are going to have to deal with. Regulatory changes and laws that will be enforced could leave many companies worse for wear.
Partnership demands, in the form of pressure to adopt new technologies that promote higher levels of efficiency at a lower cost, is another element that influences business transformation.
Digital transformation is happening all around us. If you wish to find new ways of generating revenue, pay attention to technology advancements, changing customer demands, innovative ways to solve problems and your business ecosystem.
Transform your business with TuYu
TuYu helps businesses leverage mobile wallet technology and offer consumers a safer, more convenient way to transact across South Africa. Call us on 021 812 1495/6 to learn about how our technology can help your business.