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How To Successfully Innovate In Digital Transformation?

 

Introduction

Investments in and use of digital technologies have proved effective and efficient. Companies that want to improve services, increase user engagement, promote internal collaboration, streamline processes and become more agile in a changing environment should consider developing a successful digital transformation strategy before they enter the market. In this way, they can use different digital infrastructures to collect, process, and store data to develop better products for end-users.

By using modern technologies, companies can improve the customer experience and improve customer loyalty and retention. Many companies today seek to empower their businesses to better serve their customers through using digital technology. The ability of organizations to drive the adoption of technology and develop an innovative culture is crucial. 

How do digital transformation change leaders' mindsets?

Digital transformation requires industry leaders to rethink their strategies and operations to transform industries and businesses for sustained growth. For companies willing to face change, digital transformation offers an opportunity to rethink their use of technology on a fundamental level. This turn can help companies improve their product and service offerings and build meaningful relationships with their new generation of customers.

The emergence of a connected digital economy has shifted the competitive advantage to companies that can adapt quickly and respond rapidly. Companies that successfully navigate the digital divide need to reinvent their business models to harness the transformative opportunities of digital business. The challenge and opportunity of a digital transformation framework is not technology but the pursuit of business model innovation.

As digital technologies transform one industry after another, many companies make sweeping changes to take advantage of trends and keep up with the competition. The democratizing forces of digital disruption lower entry barriers and shift competitive advantages to new greenfield organizations. These greenfield organizations are burdened by old working methods, agile enough to adapt, innovate and develop new digital business models to take advantage of the digital economy and its technology-savvy customers. A good strategy for digital transformation is more than adopting the latest technology. However, when companies get it wrong, they end up spending valuable time and resources on initiatives that do not contribute to business success.

Digital transformation is an umbrella term for implementing exciting new digital technologies and modifying key processes, operations, and services to meet changing market requirements. With the availability of these new technologies, companies are forced to consider how they will affect their operations. 

Digital transformation - a key for successful innovation

According to IDC Research, companies will invest a staggering $6.3 trillion between 2018 and 2020 in some form of the digital transformation strategy. More than 90% of organizations' digital initiatives focus on improving current products and services.

Almost 80% of organizations have digital initiatives focused on creating new products and services. The success of such transformation efforts depends on the efficient extent of the organization at identifying new opportunities, deciding which opportunities to pursue, adapting business processes, and exploiting opportunities. When employees are empowered to experiment, develop ideas, and identify transformative skills that drive business results, it is strenuous to translate innovative ideas and concepts into production. Many organizations do not characterize the transformation as a continuous process and cannot keep up with what is being done.

Digital transformation (DX or DT) is the cultural, organizational, and operational transformation of an organization, industry, or ecosystem through the intelligent integration of digital technologies, processes, competencies, and functional levels in a staged and strategic manner (Digital Transformation Strategy). It uses technologies to create value and new services in the broadest sense for different stakeholders and customers, innovate, gain skills and adapt to changing conditions. Apart from being used in a business context, it can also impact other organizations, such as governments, authorities in the public sector, and organizations involved in addressing societal challenges such as pollution and the aging population through using one or more existing or emerging technologies.

Today, many companies want their IT organizations to partner with businesses to create innovation opportunities and support services that drive change. Many companies see their procurement as the crucial source for organizations to ensure that the purchased services support innovation. The way your business leverages its IT organization and procurement organization are critical to success in the digital transformation. Companies need to have the talent, technology, data, processes, people, and organizational change skills to be innovative.

IT and most digital technologies offer the possibility of efficiency and customer proximity. Companies that make technology-driven changes distinguish a successful digital transformation from the rest. Increasing the research and development budget for digital transformation systems cannot be withdrawn from spending capital on these efforts and will further drive success.

Conclusion

According to a 2015 study by PwC, 45% of executives surveyed worldwide expect their turnover to increase over the next five years as they adapt to the digital transformation.

More savvy rivals are overtaking companies that do not understand the importance of new technologies. Competent business leaders need to think about how technological progress can help them stay relevant and create added value for their organizations. Technology cannot become an effective tool unless it researches how it can be done better and contributes to the well-being of the whole company.
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