Digital Transformation – a How-To in 7 steps for SMEs
Digital Transformation (sometimes DX), the infamous buzzword of 2020-2021 with a long history stretching back all the way to the advent of the computer.
But how can I use it to improve my business and stay above the waterline?
That’s obvious, stay ahead! How?
Specifically, a basic step-by-step guide when you want to go “Digital”
I will be discussing primary small business enterprises. And I am sure, a veteran or a big fish looking for a refresher or an outside opinion will find something useful; so, join me in our journey through the series of #DigitalTransformation!
What™ is Digital Transformation?
We’ve discussed the “definition of Digital Transformation” before. But to makes things smoother, lets re-iterate what it means again.
“Digital Transformation is a road the company takes as they adopt new ways to do business based on technological progress. Fundamentally changing using digital tools or adopting new innovative technology and/or cultural changes to improve or replace existing paradigms with new ones.” -Me
Simple enough? In essence it is when a company implements software and digital corporate culture advancements in some form, to one or several of their services both on the internal and external fronts!
It is all about using modern technology to solve day to day problems and grease the wheels of business. In itself it’s not one “thing”, or one term, it’s more of a mindset for the whole company.
A full metamorphosis if you will. Technological demands and customer expectations change almost yearly. So, companies must ensure they are agile enough to adopt and adapt to new realities (such as COVID-19) via technology.
Digital Transformation allows companies to deliver higher value services to customers, better evaluate their strategy and improve, and enhance team cohesion.
When a company adopts this paradigm, digital tech occupies every area of the business – HR, sales, acquisition, development and beyond.
How™ to adopt the “Digital” in 7 easy steps
1. Change culture: from top to bottom
- Develop proper attitude, from the leadership all the way to common worker. Everyone must understand the need and want to integrate technology innovations and streamline their business.
- A strong leader is paramount to help the team feel secure during the transitioning period. And must lead by example.
- Many instances of the transformation fail due to absence of dedication from the team. Even if they see the benefits, people are reluctant to shift paradigms and adopt change. That is simply the nature of humans.
- Adopt “transparency culture” in management that fully embraces the new requirements. Never hide the intentions of your company from your employees, everyone must be on board.
2. Process mapping: use BPMN
Graphically map all your processes in an easy to digest diagram. Don’t make a full circle going with ubiquitous standards. Go with Business Process Model and Notation 2.0 (BPMN 2.0) – it used to be an add-on or aid to digital transformation, but now, it became a requirement. Chances are, you’ll have to transpose anything you map to BMPN anyway.
You want to create a macro-map of your business and get a higher perspective.
Together with your heads of department, who intimately know their operation, (or by yourself if you’re not there yet) begin an internal evaluation, an interview of sorts, and ask yourself:
- “…are the services my enterprise provides?”
- “…human resources do I have who provide the work-hours?”
- “…are the “wants and needs” of my customers?”
- “…outside resources that are available to me?”
- “…is my budget?”
It is important to evaluate your company and have a birds-eye view of every single tiny procedure that makes part of your processes.
This ultimately helps you prioritize your next course of action.
“You cannot improve what you cannot measure.” – Peter F. Drucker
Get into every nook and cranny of your enterprises’ departments, procedures interactions and roles. This is your main task here and everything must be understood at every level.
3. Problem isolation, customer pain points and preliminary solutions
Use your graph to track – what resource loads you have, what processes bottleneck and what are your customer pain points.
It’s a common mistake to expect that by merely introducing software tools you will automatically solve every problem. Sometimes fixing a bottleneck is as simple as noticing that your production or HR are overloaded and hiring more people.
However, when it comes to customers, not everything is so straightforward.
To help you figure out your customer pain points, divide them into:
How hard is to interact with your product, get interested and then reach out to your enterprise.
Poor marketing exposure, UX/UI of your landing page, and friction during the buying process of your product are just a few things that fall under this category.
Encompasses the financial strain on the customer, including initial price, repeat purchases or membership fees and other.
Mismanagement of departments and lack of focus. Does the customer get to proper teams to solve their problem? Or is this process the right one for your customer? It’s all about if your method works.
The ability of your customer to promptly get help at a moment’s notice. These can be a sluggish (or lack of) response in your customers preferred channel. As well as the inability to get proper knowledge about your product.
4. Categorize your problems: Subjective or Objective Margins
Once we have a full map of our enterprise and all the problems defined, let’s figure out which ones fall under what category.
Define which problems are subjective and which are objective:
The ones that require constant or partial human supervision and intervention. Something that requires creativity and emotionally charged solutions based on information that is almost impossible or counterintuitive to predefine.
Problems that are easy to automate, things like online card payments, data transfers, email notifications, outreach reminders and many other.
Anything that falls under the cold logic of: If x then y else z.
5. Solution assessment – Pick your poison
Now that we know what our problems are, let’s figure out what’s the best way to fix them.
Ultimately, there are two ways to go about this:
Pick a ready to use software solution on the market. Fully developed and ready to use out of the box.
If your workflows are too wild for any service provider out there, you might have to go the custom way. In some instances, this could save you a fortune in licensing fees and on-side consultancy.
Other times you will just have to bear a large kick-off investment. The result though, will always be the same: you will get an exact operations replica, transposed in a software solution.
The good old method of getting in touch with a professional team of dedicated software developers will not do. Get the full package and aim at software development firms that feature Business Requirements Consultancy, before pitching trendy stacks. Otherwise, you risk to adventure into an Agile loss of resources rather than building on your specifications!
6. Smoke test – Deployment of your solution
It’s time to deploy your solution and carefully monitor it in the wild.
Keep an eye on conflicts of interest between departments and/or new bottlenecks. Carefully document every use-case provided by your digitalization efforts and provide appropriate support at every level of your enterprise.
Regardless of your tenacity, you can’t foresee everything. So be prepared for things going haywire at first.
If you went with Sage or SAP, consult your vendor before changing course. Chances are there is an option that might suffice your needs but is out of your plan.
Alas, it is worth mentioning that sometimes, vendors themselves can bottleneck your operations. For these cases, bespoke software development is a thing.
7. Final checks – evaluation of your efforts
At this stage you should have a clear understanding of how your digital effort affected the company. You have your data and it’s time to act on it.
Adjust to any unforeseen consequences and iron out the finishing touches.
Why™ go Digital Transformation?
In our day and age, it’s almost impossible to find someone without a microcomputer in their pocket. Thus everyone, can interact with your enterprise/product/service at any time, at any moment.
This is a two-sided coin. On one side, customers expect instant customer support and engagement. You must pour increased efforts into your digital profile, raising costs.
However, with so much digital data you can and must deliver accurate predictions about your market – increasing your margins and profits.
Assumptions can no longer be the norm; these are a luxury not everyone can afford.
Ultimately, 2020 showed that you either adapt with the new paradigm to survive or be lost in competitive noise.
It’s no secret that we live in a new world where AI can beat the best chess player. A feat few can say about themselves.
But, a mediocre player armed with AI-software can beat the best chess player, the best poker player, and best pong player. The same goes for AI. Without proper instructions and environment, it’s all but helpless.
It is all about using the proper software to maximize potential.
So, use that potential.
And if you are looking to start transforming your business with a top-of-the-line mobile application, a sleek site, or consultation in where to begin.
Well you know where to look. Wink-wink, nudge-nudge…
That ends this chapter in our ongoing series on Digital Transformation!
Yet again we merely scratched the surface and later I will digest everything in this article, from what is a CRM or ERPs, how to implement digital accounting tools and even daydream about the future of digital software!
Do you disagree? If so, I would love to debate with you in the comments! And here is a question for you – How did COVID-19 affect your company in this new stay at home era?
Stay safe tech and business-nerds, until next time!