How Any Company Can Have A Successful Digital Transformation
Everything You Need to Know about Digital Transformation
Digital transformation can be a powerful tool your business uses to maximize productivity, efficiency, and effectiveness. Here’s what it is, why it’s valuable, how to get started, common mistakes, and essential elements to include in all your digital transformations.
What Is Digital Transformation?
Digital transformation can be understood as harnessing digital technology within every aspect of your business. It’s the totality of your efforts to incorporate digital solutions into your organization. Digital transformation strategies refer to identifying, planning, and driving all initiatives involving a digital transformation program.
At its heart, it’s all about understanding and utilizing the potential of technology.
Successful digital businesses all understand one vital thing about digital transformation: it’s a broad umbrella. The value of it and the specific tools (the “what” and the “why”) vary from organization to organization.
What’s consistent across successful digital organizations is…
- Strategy. All digital initiatives must be strategic rather than reactionary.
- Mindset. Yes, an organization’s ability to successfully integrate digital transformation is about the digital platform and tools used, but it’s largely about changing the way you approach your business and view your organization.
- A holistic perspective. The goal should be to step back, to view the organization from a more high-level perspective, and to understand technology’s place in reaching relevant business goals and outcomes.
- Integration. In digitalization, a strong digital strategy enables your existing business models to be integrated with advanced technologies.
- Interconnectivity. With their steps toward digital transformation, companies should be aiming to be more interconnected at every level: strategy, process, systems, people, and overall business environment. Your digital strategy should evolve existing business objectives and goals through an interconnected systems-level view.
- Evolution. An effective digital transformation plan is the foundation for ensuring key performance indicators are met and the business is consistently evolving and growing.
Why Should Your Business Build a Digital Transformation Program?
You’ve probably seen impressive examples of digital transformation. You’ve likely heard other organizations touting the benefits of integrating new technologies.
But what actually makes digital transformation so powerful? Why should you focus on creating and implementing digital processes? Here are seven core reasons:
The Value of Digital Transformation
- Remain Competitive
If you hope to remain competitive with others in your market and to grow in your industry, you need to challenge the status quo. You need to continue evolving your organization and honing business processes to match best practices. If you don’t evolve, you will lose.
To stay relevant and competitive today, the digital transformation process is key.
- Create an Organizational Culture of Innovation
Digital transformation is largely about embracing new business models. It’s about being agile and flexible in your business thinking and harnessing digital channels to facilitate your success.
All digital transformations provide an organization with the opportunity to be highly innovative. They also provide the ability to evolve business models in the digital age.
This is less about the specifics of your transformation initiatives and more about the mindset of growth, change, and adaptability.
- Improve Your Effectiveness, Efficiency, Productivity, and Profits
Incorporating new technologies into your business processes should be done with the aim of improving four core areas:
- The efficacy of your sales team
- The efficiency of your stakeholders
- The productivity of your teams
- Your overall business revenue
When these areas are improved, it paves the way to reach goals, to achieve outcomes, and to enhance your bottom line.
- Facilitate an Interconnected and Aligned View of Your Business
When you update outdated processes with innovative digital change, you can create a business approach that’s more:
- Conducive to cross-functional teams
- Open to a systems-level view of your business models and technology
- Aligned between your people, processes, information, and technology
Alignment should happen across every component of your business. This means business strategy aligns to your digital products, and your people align to your interconnected strategies, systems, and technology.
- Improve Customer Relationships and Customer Experiences
One key piece of digital transformation is improving the value you bring to each customer. (This means existing and potential customers.)
When you harness the power of digital solutions, you can dramatically improve customer experiences throughout the sales cycle.
In the early stages, for example, digital tools can help deliver relevant, valuable content to a customer based on that person’s demographics, role within an organization, and more.
When developing content and the systems you’re using to interact with that customer, remember to always work backward from the client. Think about that client’s challenges, needs, goals, and barriers to success, and use that to inform your strategy and to improve customer experience.
Later in the sales cycle, you can also improve client retention by having your customer success team continue to focus on value. This promotes upselling and cross-selling opportunities and improves total revenue over the life of the customer with your organization.
A customer-centric approach that focuses on improving the customer experience should be one guiding light when creating new digital transformation strategies.
- Improve Employee Experience
Customers are key, but don’t forget to account for employee experience as well.
Ask yourself if your organization creates this kind of environment:
- Sales reps are always short on time.
- Sales reps have to sacrifice selling time for administrative work.
- New technologies cost your people more time than they save.
- Sales technologies don’t integrate with existing software solutions, leading to frustration and wasted time.
This is a recipe for burnout and churn. (Churn in sales is at a staggering 34 percent annually.)
Turnover is expensive and disruptive. Improving employee experience is an important part of promoting your organization’s ability to grow sustainably and successfully.
- Prompt Revenue Growth
At the end of the day, it should all come back to dollars and cents. If a decision doesn’t improve operational efficiencies and lead to a better bottom line, that decision doesn’t make sense.
Digital transformation opens the door for dramatic organizational growth, and that can positively impact your financial upside.
Depending on the size of the company, selecting the right digital technologies can result in millions of additional dollars. This encompasses both cost savings and generated revenue through effective scaling.
What's the Best Way to Start a Digital Transformation Initiative?
Before beginning any digital transformation initiatives, it’s crucial to understand your existing company. You must know your processes, your culture, and your organizational structure.
Based on your discussions with relevant stakeholders, you must then identify business outcomes, goals, and objectives for the financial performance of the organization.
This is a key starting point.
Without this information, you cannot effectively determine the key performance indicators that will mark progress and success throughout your digital transformation efforts. (As just one example, if you migrate users from Salesforce Classic to Lightning, you can use login rates and usage statistics to measure business performance.)
The importance of this data in your transformation strategy can’t be overstated.
The Most Important Aspects of a Successful Digital Transformation Strategy
Remember, a key thing to keep in mind about digital transformations is that there is no coverall answer for every organization. The specifics of your digital initiatives should be highly personalized to your business, industry, vertical, audience, market, challenges, goals, and more.
Every business process needs to be tailored to where you are now and where you want to be in the future.
If, however, you wish to rapidly adapt to the ever-changing business landscape, there is an overarching structure and strategy that can help guide your transformation efforts.
11 Nonnegotiable Aspects of Your Digital Transformation Strategy
- Identify Goals and Outcomes
For successful digital transformation, make sure every initiative moves toward your ultimate business goals and outcomes.
You should always work backward from these goals and objectives and ensure every action is a step in the right direction.
These goals and objectives should be determined after consulting with your organization’s people, and they should be widely known and shared throughout the company.
- Plan Initiatives on a Digital Transformation Roadmap
A roadmap is a way to visualize all the steps you need to take to achieve the goals and outcomes you have related to your digital technology.
Make sure your digital transformation roadmap takes into account short-term goals and long-term goals.
This kind of framework can keep you focused and strategic, and it can help garner leadership buy-in in the early stages of your transformation efforts.
- Aim for Alignment across People, Processes, Content, and Digital Technology
Alignment is essential. A siloed working environment (whether at the individual, group, or department level) will not be successful.
You need alignment between all key drivers of your organization:
- Goals and outcomes
- Every stakeholder
- Every business process
- Every business strategy
- Sales technology solutions
Alignment helps ensure everyone is on the same page, working toward the same aims, and communicating freely.
This alignment will also facilitate cross-functional work across departments, business units, and individuals. This applies to all the following:
- Customer Success
- C-level management
As just one example, your marketing team’s lead development plan should have a structured handoff process for sales-qualified leads, and your customer success team should have a structured process for closed/won deals. All this should have the capability of interconnecting with the right functionality through your marketing, sales, and customer success technologies.
- Improve the Customer Experience
Initiatives should be created with your customer in mind. Everything should be built to be customer-centric, meaning it addresses your customers’ core challenges and meets your customers’ most pressing needs.
Improving the customer experience by providing real, relevant, engaging value to your customer requires a great deal of discipline, but your success in today’s business landscape depends on this being a pillar of your digital transformations.
- Be Strategic and Deliberate
Your transformation efforts can’t be reactionary. This leads to continually treating symptoms but never the underlying disease.
All your digital strategies must be thought out, well defined, and well executed.
Your technology selection process can’t be all about the technology; it needs to align to your established business goals, strategies, processes, systems, capabilities, and people.
- Don't Neglect Training and Coaching
An often-overlooked aspect of a digital transformation plan is onboarding, coaching, training, and everboarding. A strong digital transformation adoption program should be structured to have onboarding and everboarding programs for technology users.
Because these efforts teach your sales reps how to have success within your organization, their importance can’t be overstated.
Make sure your training and coaching tactics are effective:
- Just-in-time learning is a great way to avoid overburdening your sales reps with information. It also helps ensure the information is digestible, quick to find, and available whenever the sales reps need it.
- Too many companies focus on creating activities around technology. Instead, focus on how to take action to make workers more valuable and productive.
- In your everboarding program, create an area where you can consistently update, educate, and inform your workers about where the business initiatives, processes, and strategies align with the technology; how they can become more effective, efficient, and productive with new functionality; and new ways to effectively use technology.
- Have the Right People
Part of any successful digital transformation plan is filling the necessary organizational roles.
If you don’t have digital product managers or IT leaders in your organization already, implementing those positions should be part of your overarching strategy.
Note: These roles might not need to be filled immediately; they could be part of your scaling initiatives. The important factor for success is having people with the proper skills and expertise to realize your digital transformation plans.
- Take a Systems-Level View of the Organization
When devising your strategy, think about the interconnectivity of all your moving parts: your people, processes, content, and technology.
Appreciate that no single system operates in a vacuum. Everything affects everything else.
Success is more likely when you understand your organization from this systems-level perspective.
- Appreciate the Value of Data
A sound, strategic transformation plan will rely on metrics, data, and KPIs. The objectivity of data helps with rational, informed, strategic decision-making.
Ensure this data aligns to your goals, objectives, and strategic initiatives.
- Scale Your Program
Ensure the technology you select has the ability to be incorporated now and to scale with you as you grow.
You don’t want to start from scratch every time your organization evolves.
Scaling is critical because it’s how you get an increasingly better return on your technology investment, and an effective digital transformation plan is the foundation for ensuring your organization continues to evolve.
- Improve Processes and Strategies
Every digital transformation plan will have specific targets, and these will vary from organization to organization. The main goal, however, should be to identify, to improve, and to achieve strategies and processes.
Don’t start with technology; instead, start with strategy, process, and systems. Align these to technology, and then select the best technological options to meet your most pressing needs.
How to Build a Sound Digital Transformation Program
Successful examples of digital transformation differ in specifics (the technology adopted, the goals met, and so on), but they all have some commonalities:
Harnessing Digital Technologies
Selecting and integrating the right digital technologies is central to the success of your digital transformation program.
Too often, though, companies select technology before ensuring it thoroughly aligns to their existing strategies, processes, and systems.
Before you start evaluating technologies, make sure your existing strategies, processes, and systems are updated and aligned to your latest busines objectives and goals. Only after these goals and objectives are clearly defined and updated by your stakeholders should you begin evaluating the technology for your digital transformation plans.
Keeping ROI as Your North Star KPI
ROI is a vital component of any digital transformation program.
A strong digital transformation plan must clearly define the best avenues to measure your data and your ROI.
This first requires clearly defining your outcomes and goals. Then you must identify KPIs and other areas to measure the progress of your digital program. This is vital to your financial growth, and it’s a key component of sustainable, successful digital transformation.
All decisions and business processes should be viewed through this lens. If something doesn’t yield a net positive ROI, that decision doesn’t make sense for your business. Period.
Creating a Holistic Approach to Digital Business Transformation
Digital transformation initiatives require a holistic approach to your business.
This means creating interconnectivity between your:
- information (content)
- business outcomes
- and technology
With a holistic approach, you create a systems-level view of your business, and this engenders genuine interconnectivity and cross-functionality between your business units.
Your digital transformation program should also take a holistic view of your customers. This means actually working backward from your customers’ challenges and needs and providing genuinely valuable, personalized digital experiences for each customer.
This is critical. In today’s digital environment, too many companies have not transitioned or evolved their expertise, product, services, or value to meet their customers’ ongoing needs and requirements.
If your digital transformation plans help you accomplish this, you have a tremendous opportunity to dominate your competition and market.
Developing a Transformation Strategy for Digital Technologies
Creating a Sales Technology Ecosystem
What Is a Sales Technology Ecosystem?
A sales technology ecosystem is an interconnected way of thinking about your business. It’s the idea that your people, processes, and sales technology all work together as one cohesive unit to produce results.
It’s helpful to think of an organization in this manner because it illustrates that businesses are constantly in flux. Just like an ecosystem in nature, a company is always evolving and changing, and organizational processes must be equally flexible to accommodate.
Also like a natural ecosystem, every component affects and impacts every other component. Nothing exists within a silo. A change within your digital tools is going to affect your sales reps, your marketing material, your customer success team, and more.
What Are the Components of a Sales Technology Ecosystem?
A sales technology ecosystem consists of five key stages:
Before doing anything else, you must go through a thorough evaluation stage. This gives you the data and information you need to successfully move forward and to embrace digital transformation.
Your company-wide audits should cover all the following:
- Your stakeholders
- Your existing processes, strategies, and systems
- Your current capabilities
- Your sales technology stack
A strong auditing strategy will help you identify critical overlap, gaps, and inefficiencies in your people, processes, and digital solutions. It will give you a detailed view of where you currently do and don’t have alignment among your people, and it will illuminate which processes are not genuinely updated to your customers’ needs.
Once you have the information you need, this “execute” stage is all about devising a sales technology strategy.
In these early stages, it’s important to identify your shared goals and objectives and to make sure every relevant stakeholder knows them. This means everyone, from IT leaders to sales reps, is working toward the same end result.
There must be a detailed, explicit process and strategy to align every stakeholder and get them on the same page.
Thinking strategically will help ensure your processes, strategies, and systems effectively align with your people.
The next stage is aligning potential tools with all the organization-specific data you’ve gathered and then engaging the relevant people:
- Internal stakeholders
- Vendors of potential digital tools
- Sales technology selection tools
- Third-party consultants with a specialty in digital transformation
Before investing in any technological solution, make sure your overarching business strategies and processes are all in place.
Then remember that selecting technology should involve detailed analysis. At a minimum, explore three technologies in each category. Independently demo these technologies for at least thirty days. This will help ensure several things:
- The functionality meets your needs.
- You have the organizational capabilities to utilize it.
- The tool’s functionality has a discernible and positive impact on your sales professionals’ effectiveness, efficiency, and productivity.
- The functionality of the technology fully integrates with your processes, systems, and other technological tools.
- The tool has enough additional functionality to allow for scaling.
Also, before investing, don’t forget to ask yourself these essential questions about sales technology.
This stage is all about gaining enthusiastic buy-in. To achieve adoption of your digital solution means you can use the technology for the desired intent and outcomes.
Without adoption, it doesn’t matter if you’ve selected the perfect tools. If your people aren’t using them, they’re not working for you.
If you wish to successfully implement a new technology into your organization, you will need to create a dedicated digital transformation adoption program. When doing so, keep the following in mind:
- Employees often resist change. Make sure a sound change management system is part of your digital transformation efforts.
- Focus groups, or proof of concept pilot programs, can also be helpful here. These small programs can help you ascertain a tool’s viability without having to commit to the time, money, and resources of a full rollout.
- Create a feedback loop with the technology. Establish a community environment where workers can provide their input, what they are learning, challenges, needs, questions, input for new functionality, and more.
- A digital transformation program’s success heavily relies on creating an adoption program that provides clarity about what’s working, as well as the real value in using the technology.
Once you’re seeing success with your digital tools, you’ll have the traction, buy-in, and additional revenue to scale.
As your organization evolves, you can add increasingly complex or sophisticated tools to aid even further business innovation.
Potential Digital Technologies
As you’re implementing your digital transformation efforts, you have many potential solutions at your disposal:
- Artificial intelligence
- Machine learning
- Data analytics
- Augmented reality
- Email automation
- Many, many more
The sales technology landscape is complex…and growing larger and more crowded each year.
That’s why it’s critical to think strategically about the digital tools you adopt. Many organizations want to jump at the latest and greatest technologies, but they do so without considering how well they fit into their overarching strategies.
Before investing, consider all aspects of a tool, including whether you have the organizational capacity to successfully and fully utilize a given solution.
Why Digital Transformation Programs Fail
Digital transformation can fail (or be less than optimally successful) for a number of reasons:
Shortchanging the Auditing Process
The auditing process is how you get all the information you need to make informed decisions moving forward.
If you don’t thoroughly audit your existing business units, departments, capabilities, digital technology solutions, and people, you won’t identify important areas of improvement. This includes overlap or gaps in your sales technology.
Not Prioritizing Smartly
Business transformation can be a daunting task. It’s important, therefore to start with small wins and to understand that you don’t have to boil the ocean.
Your auditing process will help you identify your organization’s priorities. You then need to prioritize those priorities. Determine what is going to make the biggest up-front impact.
Once you’ve gained traction from these initial wins, you’re in a position to demonstrate cost-cutting measures, to show additional revenue, and to foster leadership buy-in.
Working without Goals and Objectives
You need clear, defined goals and objectives if you want your organization to reach its potential.
Keep these tips in mind:
- Goals and objectives should be determined after speaking to all your various stakeholders.
- They should be known throughout the organization.
- They should be clearly measurable.
Neglecting Alignment and Interconnectivity
When devising your digital transformation initiatives, it’s essential to be strategic.
If you want the greatest degree of success with your efforts, alignment needs to be a key element of your strategic plans.
To improve the customer experience in a meaningful way, there must be cross-functional alignment between all business units, departments, and individuals.
There must also be an emphasis on creating collaboration and interconnectivity between every person, process, piece of content, and sales technology solution.
Not Creating a Sufficient Adoption Program
It doesn’t matter if you have the ideal sales tech stack for your business. Without enthusiastic, ongoing adoption, those tools won’t do anything for you.
Creating a sound sales technology adoption program helps ensure the success of your digital transformation initiatives. (Failing to account for adoption in a robust and strategic way is a common sales technology integration mistake.)
Digital leaders in the field appreciate the necessity of adoption and make it a top priority.
Depending on the size of your organization and the scope of the solutions you’re using, a sales incentive program could help bolster your adoption rates and the associated ROI.
Utilizing Outdated Technology
One common mistake that sabotages digital transformation is clinging to legacy systems.
This can cause inefficiencies that stunt your organization. These systems can have functional limitations that hinder your digital transformation projects, or they can integrate poorly (or not at all) with newer tools. All this leads to lots of wasted time, money, and resources.
As you’re selecting sales technology, aim for future-proof tools. These should more easily scale with you as you grow and continue to save you time, improve customer experience, and increase your revenue potential.
Falling Victim to "Shiny Object Syndrome"
Lots of technological tools offer incredible functionality. What organization wouldn’t be interested in cutting-edge artificial intelligence?
Be careful of getting swept up in these market trends and flashy tools.
Remember, if you don’t have the capabilities to implement that tool fully, you’re just needlessly spending money.
Not Fixing Underlying Organizational Problems
Organizations often want to jump immediately to the technology, but this is one of the biggest ways to undermine your digital transformation strategy.
If you don’t identify and fix the underlying problems within the company, you’ll just be integrating technology into broken processes and systems.
Not Illuminating the Value
If you want buy-in, you must clearly articulate the value of the tools you’re implementing.
Show sales reps how each solution will enhance their efficacy, efficiency, productivity, and profits. Detail how this is going to make their jobs easier.
Your onboarding and everboarding programs should clearly communicate this to employees. Yes, show what the technology is going to be used for, but more importantly, show how it’s going to save them time, money, or other resources.
Seeing Minimal (or Negative) Return on Investment
Not optimizing your digital transformation system means your organization is not being as productive, effective, and efficient as it could be, and you’re not seeing the financial results you want.
If you don’t have the right transformation strategy in place, this can quickly lead to sales technology churn. This, in turn, can lead to the even more costly employee churn.
Too many companies also fail to successfully grow their ROI because their strategy doesn’t account for scaling technology in order to meet growing requirements. Depending on the organization, this could equate to millions in lost potential revenue every year.
Digital Transformation in Specific Industries
The Manufacturing Sphere
Why is digital transformation a business imperative for industrial enterprises?
- Worker Shortages. The industrial markets have millions of jobs unfilled due to a growing skills gap.
- Risk and Cost Pressure. Global companies are facing increasing macroeconomic and cost pressures.
- Digital Disruption. Traditional enterprises are threatened by the rise of digital business models.
Digital transformation offers tremendous opportunity in the manufacturing sector.
The Financial Services Sphere
Digital transformation can be especially impactful for those in financial services.
- Customer-First Mindset. When you’re dealing with people’s money, it’s even more important to use tools that help you keep the customer top of mind.
- Data Reliance. Financial decisions should be informed by accurate, thorough, objective data.
- Increased Mobility. Technology allows those in finance to be more agile and mobile, and it also allows customers to access relevant information in a more mobile way.
Digital transformation in the financial industry is essential for staying ahead of competition.
The Software as a Service (SaaS) Sphere
SaaS companies might provide the tools of digital transformation, but they need to apply the principles to their own operations as well.
- Flexibility. As a web-based service, SaaS companies are better able to be flexible and to accommodate evolving customer behaviors.
- Remote Work. The rapid and ongoing shift to remote work has created unprecedented opportunity in the SaaS industry.
- Customer Experience. It’s significantly cheaper to upsell an existing customer than to seek a new client. Use digital tools to focus keenly on customer satisfaction and to pinpoint cross-selling opportunities.
The Pharmaceutical Sphere
Digitization, especially in a pandemic-influenced world, is now a necessity for pharma.
- Digital Health Offerings. From telemedicine to the emerging software as a medical device (SaaMD) industry, the move to digitalization has huge opportunities within pharmaceuticals.
- Data Analytics. The amount of available data within pharma needs to be harnessed with the proper analytical tools in order to improve diagnostic accuracy, to predict disease prevalence, and more.
- Additional Security. Blockchain technology could significantly increase the security of essential verifications within the pharmaceutical supply chain.
Summary and Key Takeaways for Digital Transformation
If you’re looking to initiate a digital transformation initiative in your business, here are the high-level takeaways:
- Digital transformation helps you harness the power of technology, which can help you surpass the competition and skyrocket revenue.
- Strategy must be at the forefront of everything you do. Without a strategic framework, you will continue to make ineffective, reactionary moves.
- Think of your organization as an ecosystem. This interconnected perspective will help your digital transformation strategy succeed.
- Reach out to third-party consultants if you need help navigating this complex landscape.
Want more information about how to have success with your digital transformation initiatives? Download our complete guide to increasing sales technology ROI.