Connecting Technology and Business.

Digital Transformation – Why and How?

A global car rental company that does not own even one car. A global hospitality services provider that does not own even a room. A food services provider without a kitchen or even an oven. A leading manufacturer of Airplane engines that does not intend to sell their product anymore but is seeing unprecedented revenue growth. A leading Indian paint manufacturer who is no longer interested in selling its paints but expanded globally and have earned profits of more than 15% year on year for nearly a decade.

All these businesses mentioned above are today leaders in their own way because of a transformation that has been brought about by digital technology – the business disruption that has emerged because of the nexus of forces – Social, Mobile, Information flow and the Cloud.

It is rare to find an enterprise that can be called leader in digital transformation – where the company uses digital technologies to transform the way they do business all the while driving significantly higher levels of profit, productivity and performance. There are very few such enterprises in India to date.

A business enterprise that leads digitally will outperform its peers; according to a survey they are at least 25% more profitable than their average industry competitors, generate nearly 10% more revenue with their existing physical capacity and drive more efficiency in their existing products and processes.

Becoming a leader in Digital is not an impossible task. All it requires is time and a courage to lead. Time – as it is a process and does not show results overnight. Courage – as it involves taking risks and bold steps to explore, identify and pursue the change.

There is a torrent of data that is generated by the Internet of Things that the digital leaders use to combine it with Artificial Intelligence, Machine learning and visualization to help them make informed decisions. They can see the future more clearly, drive out inefficiencies and better understand their customers.

Digital leaders build digital capabilities by rethinking and improving their business processes, their customer engagements and their business models. They also build strong leadership capabilities to envision and drive transformation.

Digital leaders go beyond websites and mobile apps to engage with customers. They also break some of the paradoxes of traditional operational excellence and build capabilities that improve efficiency and agility, power new customer engagements and enable new business models. Delivery models are reconfigured, new products and services are created and sometimes whole new industries are created.

Enterprises who want to lead digitally take a top-down approach. Senior management shows the direction and workers are engaged to make the change happen. Creating a transformative vision is the first step, though. The onus of energizing the employees to make the vision a reality is on the CXOs. Governance at every level will keep the transformation engine on track. Technology is the fuel that will power this transformation engine.

- some inputs gleaned from Leading Digital – HBR press.