Digital transformation. About technology and people.
Digital transformation is at the top of global development strategy priorities, according to a survey by Forbes Insights, which comprised 573 executives from around the world. According to the study, the next two years will be critical from this point of view, with half of respondents considering that their organizations will be drastically digitally transformed in this period.
The paradox is that although technology is at the heart of digital transformation, digital transformation is not about technology; it is about changing organizational culture, how we think, act and work. It is more complex than simply introducing technological means into organizational processes.
How do companies get mature in terms of digital transformation? Here are 5 important steps in this transformation process, analyzed from the perspective of two digitization studies – the Forbes Insights study conducted globally and the study "The Barometer of Digitalization 2017" by Valoria and Doingbusiness.ro, which analyzes the Romanian market:
Digital transformation becomes a strategic priority. Investing in new technologies to enable digitalization is an investment priority over the next two years for 50% of companies globally, whilst 51% have increased the budgets allocated to data analysis. In Romania, 60% of companies did not make digital transformation the central part of their business strategy, and only 4 out of 10 companies consider digitalization a priority.
Business results must support digital transformation. The above-mentioned Forbes study shows that the main engines supporting digital transformation in companies are the new business models (41% of responses), respectively the new technologies (40% of responses). Just 21% of Romanian companies expect digital business models to greatly transform their industry in the next 1-3 years, while 38% say digital business models will make it a big part of the industry.
Digital performance indicators. The indicators measuring the success of digital transformation globally are the following ones: the capacity to innovate (46%), revenue growth (46%), followed by cost reductions (43%). In the study on the Romanian market, the most important benefits of digital transformation over the next 5 years are: cost reduction (46%), process simplification (46%) and increased operational efficiency (35%).
Capitalize on data analysis. Globally, 44% of companies see themselves as leaders in data analysis and processing, and 91% of companies that have implemented such processes have seen revenue growth. In Romania, only 7% of companies are in the lead in the digital transformation process and have integrated digital technologies at the organizational level.
Integration of technology with human resources. 56% of companies believe that technology plays an essential role in the digital transformation process. Although technology is also seen as a significant challenge (by 29% of companies) and there is a fear that many jobs will disappear through technology, 47% of companies believe that digitalization will lead to an increase in the number of employees in the next 3 years.
In order to advance this path of digital transformation and reach maturity in this area, companies must maintain digitalization as a strategic priority and critical investment. On the other hand, it is equally important to define a set of performance indicators to assess the success of digital transformation and innovation. Companies also need to become more data-centric and ensure that the process of digital transformation takes place at the level of the whole organization, with the involvement and integration of human resources.