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MKTG Principal: What is Digital transformation?

What is Digital transformation?

Business Owner: “Digital transformation? Sure, our company uses email to communicate with client, we have an e-fax account, we are going paperless and on top of that, we have a website AND a company Facebook page!”

Well, no, that’s not digital transformation

Digital transformation requires an examination and reinvention of most, if not all areas within an organization, from its supply chain and workflow, to its employee skill sets and board-level discussions, to its customer interactions and its value to stakeholders.

Why you need Digital Transformation?

Digital transformation helps an organization to keep pace with emerging customer demands now and, if sustained, in the future. Digital transformation enables an organization to better compete in an economic landscape that's constantly changing as technology evolves. To that end, transformation is necessary for any business, nonprofit or institution that seeks to survive into the future.

Digital transformation is the change associated with the application of digital technology in all aspects of human society.

What are the steps:

Digital transformation may be thought of as the third stage of embracing digital technologies:

Stage 1: digital competence → Stage 2: digital usage → Stage 3: digital transformation

With usage and transformative ability informing digital literacy. The transformation stage means that digital usages inherently enable new types of innovation and creativity in a particular domain, rather than simply enhance and support the traditional methods. In a narrower sense, "digital transformation" may refer to the concept of "going paperless" and affects both individual businesses and whole segments of the society, such as government, mass communications, art, medicine, and science.

Digital transformation examples

Many industries and individual organizations are either in the midst of transformation projects, are plotting digital transformation strategies or are struggling with the concept.

Some have already undergone digitization and business transformation. Some experts point to General Electric as an example. GE expanded from its manufacturing roots to services such as its IoT platform, which enables continuous monitoring and the optimization of machines.

One example of a company that has undergone successful digital transformation is Nespresso. The maker of specialty coffee machines, an operating unit of Switzerland-based Nestle Group, deployed a cloud-based customer relationship management system, offering customers omnichannel access to shopping and customer service. They can reach the company whether they use the website or a mobile device or visit a store. A single view of each of its customers (360-degree view) has enabled Nespresso to move into more markets and improve sales.

Another example of digital transformation is Netflix, which started as a mail-based DVD rental company in 1997. Today, it's an online video streaming service that delivers customized offerings based on each customer's preferences.

Leaders need to create an organizational culture where continual improvements happen and where stakeholders are open to ongoing transformation. Everyone must be willing to identify and abandon dated and ineffective processes and replace them with something better.

Without such attention to these sweeping requirements, an organization could end up with modern technologies that enable more efficient or effective processes or procedures (such as ordering raw materials, taking inventories or handling payments) without truly transforming how the organization operates, what it has to offer its stakeholders and what value it produces for all involved.

Surprising Digital Transformation in China

Don't have any spare change? No problem, beggars in China now accept alms transferred via mobile payments by scanning QR codes with smartphones.

We all know China is embracing technologies much faster than many countries these days. Even beggars in China has “digitally Transformed” One case in point is Jinan, a city in Shandong province in eastern China, where beggars frequenting popular tourist areas like the Wangfu Pool have turned to mobile payments in order to increase their chances of receiving donations from the general public.

The beggars place a printout of a QR code in their begging bowls. The QR codes enable anyone with a mobile payment app like Alibaba Group's Alipay or Tencent's WeChat Wallet to scan the code and send a certain sum to the beggar's mobile payment account.

If beggars can do it, there is no excuse for your organization not to do it.

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