What is the business equivalent of digital transformation?
Technology is used in digital transformation to change how firms run. In order to adapt the company to the digital economy and new client requirements, it may involve modifications to infrastructure, business culture, and processes.
Digital transformation is a matrix function from a business standpoint that affects all divisions of an organisation, including finance, sales, marketing, product, customer support, human resources, and more.
The improvements made by each of these departments are intended to enhance customer interactions, enhance the customer experience, and increase the organization’s competitiveness.
Although it focuses on the consumer, digital transformation ultimately affects the business itself. It should result in a measurable improvement in business KPIs like revenue, profitability, and market share. In this post, we’ll highlight five examples of significant corporations that underwent digital transitions and achieved outstanding achievements.
5 Business Examples Of Successful Digital Transformation
Here are a few actual cases of businesses who undertook large-scale digital transformation projects and were successful in generating business results.
With more than 300,000 employees, Target ranks among the top ten retailers in the United States. To increase sales, the company started offering online ordering and started a digital marketing campaign. Additionally, physical stores were updated to make it easier for shoppers to find products and browse in-person while making online purchases.
The outcome: Target started its digital transformation in 2006, and since then, its stock price has increased from $53 to $88, with $6 billion more in revenue.
Hasbro is a toy and game manufacturer with more than 5,500 staff members and yearly sales of over $4 billion. In 2012, the business changed its focus from primarily targeting youngsters to now targeting parents as a market.
It developed extensive campaigns powered by data and aided by social media. The same information was utilised to help parents better understand themselves, suggest the games that would be most beneficial to their kids, and facilitate purchases across various channels.
Results: The marketing initiatives increased Hasbro’s marketing costs by almost 10X, but they also increased sales by $1 billion and the share price by $36 to $109.
A Fortune 100 manufacturer with operations in a number of sectors, including aerospace and building technologies, is Honeywell. To increase quality and make it simpler to implement digital initiatives, Honeywell reduced its operations from eight markets to six in the early stages of its digital transformation.
A digital transformation team was established at Honeywell, leading to the development of IoT-connected products, data-driven product offerings, and sophisticated industrial process control. Customer information was examined and used to enhance product offers, assist customers in making wiser decisions, and improve manufacturing procedures.
Results: Honeywell’s revenue increased in 2018 from $40 to $43 billion (although it later decreased to $38 billion), and its share price increased from $95 to $174.
Over 400,00 people work at the home improvement store Home Depot. The business set out to offer a better eCommerce experience in 2017, one that was tightly connected to other channels including physical stores.
The company strengthened the IT department, enhancing its capacity to receive and analyse customer data, and hired 1,000 new personnel with expertise in digital and customer experience. Through the application of predictive analytics on local inventory levels, this data can be used to save expenses.
Results: Revenue climbed by almost $17 billion, and the stock price rose from $135 to $215.
With more than 166,000 people, Microsoft is the biggest software firm in the world. To compete with companies like Apple, Amazon, and Google, Microsoft launched a new digital strategy. Its primary goal was to establish a cloud computing company that would make its technologies more accessible to both smaller and larger businesses. It created Microsoft Azure, which rose to become the second-largest cloud provider in the world, and improved its market share by forming alliances with other industry titans like SAP, VMware, and Oracle.
Results: Market capitalization has increased to over $1 trillion, and share price has increased from $38 in 2014 to over $136 today.
How Does the Digital Revolution Promote Business Growth?
Here are a few ways that digital transformation may affect how successful a company is in the marketplace.
Providing an Integrated Digital Experience
In their daily lives, consumers are accustomed to seamless, convenient digital experiences. In the workplace or while interacting with a company, they anticipate having the same experience.
Businesses who can provide agile IT services and react rapidly to client needs will prosper. In order to ensure that their services fulfil the needs of the digital consumer, successful firms will concentrate on the user experience, performance, and security of digital services.
Better Decision Making
Businesses are now able to make better, quicker decisions because to the digitization of business processes and data. Businesses may now forecast future results using historical data by utilising data analytics and machine learning.
Organizations who can leverage the power of digital transformation and convert data into insight will have a big advantage in this situation.
Increasing Staff Productivity
Many businesses are having trouble finding qualified employees, especially for technical positions. By facilitating employees’ ability to perform their duties and by creating a more stimulating work environment, digital transformation will enable businesses to get more from their current workforce.
For instance, many businesses have put in place self-service IT portals that let staff members acquire software licences or request computer support without dialling the help desk. As a result, IT employees are now under less stress, and employee satisfaction has increased.
Improving Pricing and Inventory Control
Retailers are managing inventory and pricing more efficiently thanks to digitization. Retailers are able to better assess consumer demand and modify inventories by digitising the supply chain. They can avoid having too much inventory and overcharging for in-demand goods as a result.