Digital Innovation Spurs Transformation Efforts
Digital innovation is moving faster than ever before. As a result, CEOs are in a race to find new ways to create value for their customers and disrupt the competition. Recent research from Forbes indicates that 90 percent of businesses have implemented a formal digital transformation initiative in order to realize the advantages offered by new technologies.
Transformation Is Critical
Although some organizations still have concerns about digital transformation efforts, most recognize the need to stay engaged in digital innovation. Forbes highlighted three reasons why it’s critical for businesses to focus on digital transformation in order to drive innovation. The first reason centers on the customer.
“Most digital transformation efforts are focused on developing ways to more effectively engage customers in traditional channels and meet their rising expectation,” Forbes contributor Stephen Diorio writes.
By pursuing digital innovation, businesses may be able to figure out their customers’ preferences, as well as interact with them more effectively — factors that may help promote customer retention. Businesses can also keep pace with tech-savvy competitors by staying focused on digital transformation.
“Threats can come from both new ‘digital native’ competitors and existing suppliers, partners or competitors who use digital to augment, disintermediate or disrupt the traditional value chain,” according to Forbes. Furthermore, based on a Dell survey of 4,000 business leaders, digital startups or new competitors are taking advantage of digital technology and posing as a threat to businesses.
However, the top reason businesses should be more vested in digital transformation, is to find new revenue growth — a reason cited by 46 percent of the respondents to the Forbes survey. Without that growth, businesses would find it difficult to create new products and business models to reach their goals. Furthermore, more than half of survey respondents “are actively developing products and services that leverage digital and cloud-based platforms.”
The Forbes survey reveals that digital transformation efforts are one of the top strategic priorities for most businesses. Increasingly, organizations are feeling pressured to pursue innovation in order to stay relevant to their customers, lessen competitor threats and grow the business.
However, although most of the respondents surveyed are digitally transforming their businesses, less than one-third have “significant executive-level sponsorship,” and most of those initiatives aren’t delivering the anticipated results, which goes to show that effectively leading a digital transformation effort can be more difficult than it sounds.