Between expanding cloud services, increasing mobile apps, and our collective reliance on Internet of Things (IoT) technologies, digital transformation is booming.
It’s so prolific the entire Global Digital Transformation Market is expected to more than double, growing to USD $1,009.8 Billion by 2025. Experts predict it’ll pick up the pace with a Compound Annual Growth Rate (CAGR) of 16.5% year over year.
But what does that really mean for the end user? And how are these digital-first consumers shaping the evolution of digital transformation?
Digital Transformation Defined
Digital transformation can look several different ways: Automating business processes, adopting AI in your operations, moving to the cloud, and implementing new workplace technologies are all examples.
It’s a catch-all term that describes how businesses become digital-first and create new opportunities for growth while weathering disruption. Efforts may focus on evolving internal models, like leveraging data, or external factors, such as driving better customer experiences through tech like chatbots.
Or, as this MIT Sloan Management Review offers, “Digital Transformation is better thought of as continual adaptation to a constantly changing environment.” Others, like Red Hat, simply describe it as, “Better living through software.”
End User-Driven Digital Transformation
The technological advances from decade to decade have never been more pronounced. But they’re not just the work of gifted software engineers or digital disruptors. Digital transformation is in large part a response to customer demands and changing expectations.
Forbes illustrates this with its recounting of Netflix’s attunement to the movie marketplace, “Founded during the decade-long decline of brick-and-mortar Blockbuster, Netflix changed the game by delivering the latest movies right to customers’ front doors, then went on to completely digitize its experience.” Though they’re quick to point out that it takes more than technology alone to make such an impactful arch. “Netflix’s success involved the careful collection and curation of customer data – habits and preferences that have since influenced everything from the design of its user interface to its raved-about productions.”
Digital transformation is the same reason the sharing economy exists, all but replacing taxis with ride-sharing services and hotels with Airbnb or VRBO listings. In the same way phone books disrupted word-of-mouth marketing, smartphones have made these relics almost obsolete, showcasing again how digital advances come as the result of shifting consumer movements.
On the other side of the spectrum, digital pioneers know how to outperform their competition and drive customer loyalty by meeting them where they’re at.
As IBM explains, the world’s most recognizable disruptors tend to use technologies that help them adapt, reinvent, and optimize their:
- Business models (e-commerce, electronic delivery).
- Business processes (supply chain management, new feature development).
- Customer’s experience (in-context customer reviews, personalized recommendations).
The point is: Great leaders understand that all industries face disruption in the digital age. The key is to prioritize your customer and let them inform your digital evolution so you can provide the most valuable experience possible.
No two digital transformation journeys will look the same. But if you can reverse engineer for the ideal customer experience and supplement it with a comprehensive mix of tech-supported changes, you have the best opportunity to transform beyond disruption.