Business needs to change for the digital economy

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By: Wise Marketer Staff |

Posted on October 12, 2015

As consumers readily adopt the latest advances in technology, businesses find themselves having to adapt to continuous changes to the way we work, communicate, buy and sell, according to Simon Walker, director of innovation for Stibo Systems.

Future-proofing themselves, they are undergoing digital transformations that will help them deal with the new challenges and opportunities they face.

While much has already been written about how businesses are implementing these transformational activities, Stibo Systems was interested in the reasons why, and the issues that these activities presented.

In order to find out more, the company commissioned a survey of line of business and IT managers from organisations in a range of industries across Europe, exploring the issues they'd experienced around their digital transformation projects.

Transformation for customer management
The survey's findings clearly reveal a widespread commitment to digital transformation, with three quarters of businesses claiming to be currently undertaking a transformation project (76%).

59% of organisations reported a higher level of investment in transformational activities in 2015 than in the previous year, the main driver for which appears to be a desire to increase their ability to meet the expectations of their customers.

This one factor was rated by the majority as the most significant benefit of digital transformation, far outranking the ability to reduce the costs of doing business or IT costs.

Given the rate that consumers are embracing the multiple channels made available to them by the latest technological developments, it's perhaps unsurprising that this is the case.

And the fact that around two thirds of companies' initial transformation projects were based around customer management and satisfaction should be similarly unsurprising.

In addition, metrics relating to customer engagement were cited as being the most effective way of measuring the success of a business's digital transformation.

The importance of good data governance
As interactions with consumers become increasingly more complex and multi-layered, it's crucial for businesses to draw on every available source of data if they hope to be able to address their customers' wants and desires. For this reason, it's now more important than ever for organisations to have unfettered access to accurate, up-to-date, high quality data.

This is recognised in the finding that more than two thirds of organisations consider the role of effective data management a key part of improving business processes through digital transformation, with 77% considering it important to improving customer experience.

Poor data quality was recognised by more than half of respondents as having the potential to hamper digital transformation, disrupting a company's business processes by adding extra time and layers of complexity.

Furthermore, respondents cited finding the right data (70%) and inconsistent data (62%) as issues that could hinder the progress of any transformational activity and lessen its overall impact.

Underestimating the level of disruption
No progress comes without a level of disruption, something the majority of companies are fully aware of.

87% of respondents acknowledged the potentially disruptive effect that transformational activities could have on their business processes, and a similar number agreed that failing to prepare for this was done at a company's own peril.

Although - apparently - undertaking their transformational activities with eyes wide open, more than half admitted that they had, in fact, underestimated the level of disruption (53%) and issues around data management (54%) actually experienced by their business.

There are a number of reasons for this including poor data governance which, as we've seen, can be problematic, with business processes hampered by inadequate, inconsistent and inaccessible data.

Limited collaboration across different business units could also be a contributory factor, as could a basic lack of planning, or even just a simple failure to fully appreciate the real impact that digital transformation would have on the overall business.

Interestingly, despite these findings, two fifths of companies considered themselves to be true digital enterprises (39%), and half believed their digital transformation projects to be more mature than those of their peers and competitors.

Ongoing and evolutionary
Regardless of the industry or region in which they operate, organisations across Europe are investing more than ever in digitally transforming their businesses in order to meet the digital revolution head-on.

Seemingly undeterred by the additional costs, complexities and complications they face, they are undertaking projects designed to improve their ability to meet the constantly changing demands of their customers.

While most businesses accept that some disruption is inevitable, however, many experience a greater level than initially expected. Poor data governance - commonly a prime reason for much of this disruption - with inconsistent, inaccurate or inaccessible data hindering transformational activities, can be improved with more effective data management.

"Companies in different industries and different locations are at different stages of their digital transformation projects, the objectives of which vary according to an organisation's current business focus," concluded Walker. "An ongoing, evolutionary process, the success of an organisation's digital transformation will depend on having a level and type of activity that's appropriate to that organisation's needs at any given time."

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