What Are The Four Main Areas Of Digital Transformation?

Updated: March 6th, 2024

Digital transformation is much more than looking for the latest technology to bring into your company.

It’s a business-wide transformation that touches everything from process to culture, to the customer experience and how you use data for better decision-making.

While going through a ‘digital transformation’ is no easy thing (70% of digital transformations fail) it can have a hugely beneficial impact on your business.

And although digital transformation can impact every area of a company, it tends to fit into four key business areas.

That’s what we take about in this blog.

At Elite Group we’ve taken hundreds of companies through successful digital transformations, whether it’s transitioning away from fixed phone lines to cloud based phone systems.

Or deploying full unified communications as a service and contact centre as a service platform into their company.

Here are our key takeaways that can help you get through the process and improve your business.

 

Defining “digital transformation”

Let’s start by defining what a digital transformation is.

At its basic level digital transformation uses new technology, processes and business change to achieve an outcome, whether that’s:

  • Designing/ building a new product or service
  • Improving the customer experience
  • Removing operational or structural inefficiencies within the business
  • Decreasing business costs and streamlining tech stacks
  • Making better use of business data collection and analytics

As we’ve said, while digital transformation has far-reaching benefits across any business, it tends to focus on four key business areas.

 

The four main areas of digital transformation

 

Transforming processes

Digital transformation impacts every business area from HR and accounting, to marketing, sales and the customer experience.

Within each of these departments, there will be processes that can be greatly improved.

These processes tend to be highly manual and repetitive.

They’re important, but they’re monotonous and don’t require a lot of thought (which is why they’re usually a drain on morale)

For example in the customer experience arena, the manual process of routing callers to the right department is highly repetitive and also doesn’t give the customer the best experience.

Digital transformation through intelligent call routing – for example – can not only automatically transfer callers to the right person based on their enquiry, but it can also prioritise which callers are dealt with first based on their previous call records.

This not only achieves removing a repetitive task from an employee so they can focus on other tasks, but it also improves the experience the customer has too.

Digitally transforming a business process doesn’t have to be difficult, but you should follow a framework in order to give you the best chance of success.

 

Digital Transformation

6 steps for a business process transformation

 

  1. Set your goals

Goal setting is an essential first step of any digital transformation, and not going through this process is one of the big reasons most projects fail.

You should look at processes in your businesses that aren’t working as well as they could, and set goals for how you can improve them.

For example:

“We want to use automatic ticketing to improve the speed with which customer enquiries are dealt with.”

  1. Set your baseline metrics

Once you know the goal you want to hit, you need to take a baseline reading of how the process is performing now.

This is critical as it’s the only way to judge any improvements later on.

For example, your current time to enquiry resolution could be 52 hours – and you want to bring it down to 48.

  1. Get stakeholder buy-in

Not getting employee and stakeholder buy-in to your digital transformation project is a sure way for it to fail.

Without proper buy-in from senior stakeholders, you likely won’t get the backing or finances to implement a proper transformation.

Without employee buy-in you’ll never get the technology rolled out as effectively as you could.

  1. Create the ideal process/workflow

For any process or workflow you should have an idea of what the ideal process should look like.

For example a customer enquiry begins at A, if the enquiry can’t be dealt with it moves to B, with C being the point of escalation etc

And this process should be written down from start to finish.

This will help you focus on the design of your digital transformation to ensure you increase your chances of getting the desired result.

  1. Go live

Once the project has gone live, you should focus on the immediate improvements/ or failings as well as the initial employee reaction to the new processes.

These immediate insights give an early indicator as to the hurdles that need to be overcome quickly before confidence in the process is lost.

However, these initial results shouldn’t be used to make decisions on longer time horizons.

  1. Monitor & improve

Once the project has launched you should continually monitor whether it’s producing the results you wanted.

If it’s not (and even if it is) you should use your data to understand where the pros and cons of the new workflow are, and use these insights to improve your processes further.

 

Transforming your business model

If you’re wondering how digital transformation can change entire business models, just look back over the last few years.

At the end of 2019, and beginning of 2020, who could have imagined the way we’d be working today?

Remote work had been around before 2020, but never to the same level.

Within the space of a few years, businesses that had been entirely office based (with every intention to stay that way) had gone fully remote and used technology to completely change their business models.

You can also see across multiple industries how tech (or tech businesses) have transformed business models.

Look at how Apple disrupted the music business and then how streaming services took it a step further.

Look at how Netflix changed the video and film distribution business (and how many other businesses have now followed suit with their own streaming services).

Or how Amazon changed shopping into a complete online (and far more convenient) experience.

 

Transforming industry domains (products and services)

One thing that’s often overlooked in the digital transformation space, is the potential it creates for new products and services.

If you’re looking out for it, going through a digital transformation allows your business to move into new industries and have success with other products or services.

A prime example of this is Amazon and it’s move to Amazon Web Service.

The initial move happened because Amazon was using a lot of cloud computing to manage its own infrastructure as the shopping giant grew.

Now AWS is one of the leading cloud computing providers in that space – all because of a digital transformation.

 

Transforming company culture

It can’t be stressed enough how important company culture is in the space of digital transformation.

You can identify and bring in the best new technology, but unless you have a culture that adopts change and new ways of working, you’re never going to get the best out of the technology.

And according to research published by PwC, there is a huge disconnect between executives and employees when it comes to new tech.

While 90% of execs say their company pays attention to people’s needs when introducing new technology, only 53% of employees agree.

Failing to build culture into your digital transformation can have far-reaching, and long-lasting implications for your digital transformation project, including:

  • Slow uptake of the technology
  • Resistance to the new technology
  • Lost productivity
  • Wasted money and resources

There are lots of reasons employees resist new technology.

Some will be suspicious about whether the new tech is being brought in to help them or eventually replace them.

Others believe it’s just another new system they’ll have to learn before it’s replaced in another 12 months (a side effect of no long-term strategy for your digital transformation).

On the other hand, building a culture around digital means employees are much more likely to embrace change and allow for more experimentation with new technology in their role.

Part of creating a culture around digital transformation means embracing a few key beliefs:

  • Autonomy over top-down control: Showing employees you trust them to work and don’t try to micromanage or direct them from the top down makes employees more likely to embrace new tech
  • Encourage risk-taking over caution: One of the reasons employees resist digital transformations is because they believe if it doesn’t work, or performance drops (even just in the short-term) they’ll be blamed. To succeed in digital, employees need to be encouraged to take some risks even without the guarantee of success
  • Try and fail fast: Similar to the point above, employees need to be encouraged to try new things to improve how they work (this is the essence of digital transformation after all) and be prepared to move on without judgement
  • Create collaboration over siloes: Instead of bringing in new technology per department, you should take a company-wide view of digital transformation and look for opportunities to create more collaboration, rather than building tech and departments in siloes

 

Overcoming your digital transformation challenges

Although a digital transformation undoubtedly carries many benefits that can not only improve your business in the short-term but protect it from unknown threats in the future, you will likely have a few challenges to overcome to ensure your project is a success.

This is especially true if the technology is something you’ve never had in the business before.

Below are some of the key digital transformation challenges we see time and again with clients:

  • Lack of skills: Employees aren’t tech experts and (unless they’re technical staff) they likely won’t have the natural skills to instantly use technology when it’s brought in. This means going through a period of training and ‘bedding in’ the new technology until employees know how to use it properly. This lack of digital skills can delay any of the real benefits you can expect to see from a digital transformation project.
  • Lack of data: Any digital transformation should be based on data and insight to make sure you’re bringing in tech and processes that will improve what you’re already doing. But the only way to do this is by using your existing performance data to understand where the improvements can be made. Businesses without this data could struggle to identify the best areas for transformation.
  • Budget: Budget constraints can prevent you from making the full technology changes you want to make within your company. In these instances, it’s best to prioritise the business areas most in need of change and start from there.
  • Security: Adopting new technology can inadvertently increase security risks to your company. Moving to the cloud for example (while safe in itself) creates threats from phishing scams against your employees. As part of any digital transformation strategy, you should identify the threat areas to the new technology and ensure protection and training form a central part of the project.
  • Aversion to change: This links to what we’ve already talked about in that businesses that promote top-down control and risk aversion will always come up against resistance to any digital transformation projects by their teams. The cure to this is to create a more open workplace where employees are encouraged to take (calculated) risks and promote better ways of working.
  • Legacy systems: Legacy technology and processes are often the biggest stopper of digital transformation projects. Because they’re so outdated they may not be able to integrate with your new systems – which could increase the scope of your transformation and cause budget problems. This is before you get into the security flaws in some legacy systems.
Diagram demonstrating the range of solutions involved in digital transformation.

 

Who owns the digital transformation?

Another bottleneck towards a successful digital transformation project is not having an ‘owner’ of the project.

Without proper leadership, these projects tend to move off point and lose the backing of senior stakeholders when they don’t see progress.

Creating a steering group for your digital transformation creates responsibility for the project and also establishes accountability for getting the project done.

In terms of who should be involved in the digital transformation, there’s no definitive list but it could include:

  • IT
  • Finance
  • Project manager
  • Department reps whose teams will be using the new technology

 

Don’t risk your digital transformation going off course

A digital transformation can either take your business to a new level, or it can cause more disruption than it solves if you don’t manage the process.

Working with Elite Group you’ll have a team of digital transformation experts behind you all the way.

We’ve worked with hundreds of clients already to help them map out, execute and optimise a digital transformation project to improve their business.

You can see examples of our digital transformation projects in our case studies to see how we work with clients.

Or if you’re ready to get more information about how a digital transformation can change your business for the better, get in touch