The Four Main Areas of Digital Transformation in the Real World

The Four Main Areas of Digital Transformation in the Real World

How many “too-good-to-be-true” ideas have you come across lately? Celebrities hawking bitcoin? Smartphones that roll up like a set of window blinds? It’s not unusual to come across a good idea and then end up feeling disappointed when that idea fails in the real world. Likewise, digital transformations can succeed as good ideas on paper but fail in the real world. The solution is good planning.

The Promise of Digital Transformation

Digital transformation is about using technology to create new or transform existing business processes, culture, and customer experiences. It’s a call to action for businesses to keep up with their competitors, set new standards or goals, and meet changing market requirements. But launching into a digital transformation just because it sounds like a great idea does not mean it’s ready to be a good idea.

Before you head down the path, ask the following:

What transformation(s) are you hoping to achieve? There are four main areas, and we’ll discuss these later in this topic. We suggest you review the four areas, read about their real-world equivalents, and come back here.

What are the goals? Does your business need to update or modernize systems, or does your business need a new organizational structure to adapt to changing conditions? Compare competitors and markets: what are things looking like in the real world?

Establish baseline metrics. Determine the acceptable or expected outcomes before spending valuable resources or time on the effort.

Bring in all stakeholders. Consult the relevant participants in your proposed transformation. Get feedback on their expectations, and adjust the transformation effort.

Map out the transformation process. Use a whiteboard, UI/UX tool, mind map, or whatever it takes to map out going from Point A (how things look now) to Point B (how things look after the transformation is complete).

Test, test, test! Do not let your transformation plan roll out without appropriate testing. Recently, Twitter made a change to Twitter Blue verification that was supposed to prevent users from masquerading as other users. The change didn’t work, and the whole thing had to be rolled back. Better to make mistakes in testing before they go live in the real world.

A digital transformation project can address four main areas:

1. Process Transformation

Process transformation improves the efficiency and effectiveness of a company’s operations. The effort involves a review of existing processes and systems to identify areas for improvement to better achieve the company’s goals.

As examples of real-world process transformations: our case study for a regional healthcare provider. Using Twilio Studio Flow, Terazo helped this provider automate post-operation follow-up calls with their patients. Additionally, we worked with a well-known automotive retailer’s transformation for growth.

2. Business Model Transformation

Companies are pursuing digital technologies to transform themselves from traditional business models. In the real world, postal mail was the primary means of communication for decades. That method is being replaced by telephone, email, texting, and app messaging. While the business model—the need to communicate—remains the same, that process is undergoing a digital transformation.

3. Domain Transformation

A domain transformation is a redefinition of a business’ existing products and services, blurring industry boundaries and fostering opportunities for non-traditional competitors.

Amazon Web Services (AWS) is an excellent real-world example of domain transformation. Specifically, Amazon moved from a bookseller market into the cloud services market and changed the entire web by offering cloud computing/infrastructure services. By working to become the largest provider of such services, Amazon dominates the retail online service market, allowing it to branch outward into other services and products—from entertainment streaming to subscription retail delivery.

4. Cultural/Organizational Digital Transformation

An organization that fails to align its digital transformation efforts with its internal values and behaviors can affect an organization’s culture. Failure to adopt newer digital technologies can lead to a loss of market competitiveness, lost productivity, and declining revenue. On the other side, a comprehensive and collaborative effort can help positively shift the culture to understand, embrace, and advance digital transformation.

One real-world example of the negative effects surrounding cultural/organizational digital transformation is the real estate industry. Slow to adapt and slower to embrace technology beyond phone and email, the real estate industry did not willingly embrace digital transformation and suffered from the result. There were many failed attempts to transform the industry: picture-based property showings, site listings that were not kept current, and crude web forms to connect buyers with sellers.

As a positive example, Zillow and other real estate startups brought technology and careful planning to the buying, leasing, and selling experience. Buyers can zero in on specific geographic areas, check properties for desirable features, tour properties via video, chat online with agents, and even apply for a lease or connect directly with a realtor through the app and website.

Want to learn more about how Terazo can assist organizations with their plan for digital transformation? Terazo has helped businesses in the retail space evolve and grow by leveraging internal software platforms that can improve efficiency and inventory tracking, and Terazo’s data engineering services can help automate and streamline data so organizations can make data-driven decisions in real time. Reach out to us and learn more at hello@terazo.com.

Team Terazo

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