How Companies Can Win in Digital Transformation

Mon, Jan 23 2017 | Author: PT. Central Data Technology

Digital transformation sits atop the strategic agenda for enterprises, according to a Forbes Insights and Hitachi survey of 573 top executives worldwide.

The next two years are critical in this regard, as half of them believe that their organizations will be vastly digitally transformed in that time.

Transforming your business to be digitally ready is not just about technology. Digital transformation uses technology as a means to an end and goes beyond business. It is all about transforming how individuals work and the cultures of organizations as it is about technology. The most difficult task is to change the way we think.

Based on survey by Forbes Insights and Hitachi, top executives revealed that there are five major steps for transitioning toward digital maturity.

There are some areas where a majority of companies seem to be on the right track:

- Make transformation a top strategic priority. Digital transformation is the top strategic priority (50%) confirms the Forbes Insights and Hitachi survey. The strategic emphasis on digital transformation is reinforced by executives' focus on investment. Investing in new technologies to enable digitization is the top investment priority over the next two years (51%), along with increasing data and analytics capabilities (51%).

- Business outcomes need to drive digital transformation. New business models are the top driver of digital transformation (41%), followed by new technologies (40%). It is sign of maturity that the ability to innovate is the top measure by which the success of digital transformation is measured (46%), along with revenue growth (46%), followed by cost reduction (43%).

- The Potential of data and analytics is not fully utilized yet. While less than half of companies (44%) see themselves as advanced or leaders in data and analytics, a vast majority (91%) have already seen revenue increase due to the use of data and analytices. Only a third of companies consider themselves leaders in customers experience based on their digital transformation, which points to underutilized potential.

- An enterprise-wide approach to digital transformation needs to be adopted. Currently, cross-functional teams are not involved enough in developing (40%) or implementing (35%) strategy, with the bulk of this work done by IT (50% and 54% respectively). IT is the function considered the most prepared for digital transformation (53%), while other functions lag, with just over a third of survey respondents deeming them ready.

- Companies need to learn how best to marry technology with human resources. Technology cuts both ways. It is seen as the biggest challenge (29%) and the top contributor to a successful digital transformation (56%). People (defined as talent and capabilities), on the other hand, are not seen as equally significant contributors to the success of digital transformation.

There will be a significant change in the next two years. Almost half of companies believe that they will be digitally transformed. Most of them expect transformation to take one to two years. Forty-two percent think it will take less than one year, and 27% more than two years.

Source: How to Win in Digital Transformation - Hitachi & Forbes Insights