The blog article is the first part in using Corporate Performance Management (CPM) for digital transformation.
What is digital transformation? It sounds like most nebulous concept terms that mean something different to almost everyone. According to ERP Software, “Digital transformation is what happens when businesses rethink processes, services and products in terms of what is possible using current technology.” Digital technology has entered a new era in innovations including advanced analytics, cloud computing, machine learning, human-machine interfaces, digital-to-physical transfer, and more. To sustain competitive advantage, organizations will need to adapt and grow to meet the evolving needs of their customers. What’s even better is that transformation is not confined to large businesses that have a wide array of resources and loads of money in their budget to spend. With modern cloud business intelligence (BI) and corporate performance management tools, anyone can now access and benefit from the most advanced resources. In this article, I will cover two fundamental pillars of digital transformation based on The Art of Digital Transformation – Four Pillars of Industry 4.0 by ANEGIS Consulting, a Microsoft Gold Partner.
Digital transformation is a concept that could easily end up as a hype or a disappointment. I say this because there have been many times that technology initiatives coined as transformative and innovative, yet the tools were nothing more than making processes more efficient. True digital transformation occurs when innovators and leaders use digital technology to develop new products, anticipate and answer customer demand, unite operations worldwide flawlessly while allowing their people, internally and externally, to reach their goals. No wonder “86 percent of CEOs say digital transformation is their number one priority,” based on a study by Price Waterhouse Cooper in 2016.
Here are two foundational pillars of digital transformation:
1) Engage Customers – As mentioned above, integration of digital technologies should be taken advantage of to shift your focus to customers. Various routes to integrated data and sources of data such as customer feedback and interactions, product performance, and social networks enable customers to gain insight in every area of the business. Digital transformation makes communication more effective and responsive by allowing organizations to reach customers directly and accommodate their business models. Also, digital transformation makes it easier for business models to take full responsibility for the economics of mass customization, where “one-off product configurations are as efficient to produce as a batch.” An example the article uses is Haier, an appliance manufacturer. Haier has its refrigerators and washing machines made to order in China. The customers of the appliance manufacturer specify what features they want on their phones, computers or at Haier retail stores, and those details are sent directly to production.
2) Empower Employees – Digital transformation is not only positively affecting customers, but also encouraging employees. Uplifting colleagues to handle assets and processes in real time by connecting them with the information they need at any place, any time, and on any technological device. Isn’t this what digital transformation is about? In the article, ANEGIS Consulting talks about powerful new “collaboration, simulation and design tools, such as Microsoft HoloLens.” Microsoft HoloLens enables design teams from all over the world to work and collaborate virtually. Microsoft defines it as “the first self-contained, holographic computer, enabling you to engage with your digital content and interact with holograms in the world around you.” For instance, Volvo Car Group utilizes HoloLens to enhance its design processes and makes the technology an inherent part of its sales function, allowing the sales team to offer their customers a deep, immersive virtual experience. Volvo did a fine job incorporating immersive experiences have become the norm across all industries as those moments stimulate our senses with realistic feedback. Consumers and employees are seeking to participate in immersive experiences that take them to a place that enriches their experience of the world around them.
The examples above may or may not feel relevant, but the general message I am trying to convey is that digital transformation is the process of reframing business structures, products, and services in regard to what is possible using current technology. In the CPM realm, digital transformation can also mean investing in modern cloud platforms and solutions that help companies make better informed decisions from anywhere around the globe to improve reporting and budgeting processes for the organization itself and its customers. Cloud technology is becoming more widely adopted and trusted in the corporate realm due to the flexibility, security, and user friendliness it brings. Tools such as financial reporting and budgeting solutions have been around for decades, but as technology continues to rise and evolve, your company has to pick solutions that make the most sense for your company goals and business processes.
Clearly, digital transformation is happening as we speak, and any organization can take initiative while keeping the two foundational pillars mentioned above to better experiences for customers and employees. Look out for the next blog article where I will cover the latter half of the art of digital transformation.
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