5 Successful Digital Transformation Lessons From The Professionals

So how can businesses increase their chances of success in digital transformation? In this blog post, we will share five lessons learned from some of the most successful digital transformation stories in various industries. These lessons can help you avoid common pitfalls and overcome challenges in your own digital transformation journey.

Lesson 1: It’s a Multi-Disciplinary Effort

One of the key factors that contribute to a successful digital transformation is the involvement and collaboration of different stakeholders across the organization. Digital transformation is not just a technical project that can be delegated to the IT department. It requires a holistic vision and strategy that aligns with the business goals and values. It also requires the input and feedback of various functions and teams, such as marketing, sales, finance, HR, and customer service.

A good example of a multi-disciplinary digital transformation is IKEA, the world’s largest furniture retailer. IKEA faced several challenges in its traditional business model, such as complex supply chain, underoptimized inventory, and hectic customer experience. To overcome these challenges, IKEA launched a digital transformation initiative that involved multiple aspects of its business. Some of the key actions that IKEA took were:

• Developing a new e-commerce platform that integrated online and offline channels and offered personalized recommendations and delivery options.
• Implementing smart home solutions that enabled customers to control lighting, sound, and temperature through voice assistants and mobile apps.
• Leveraging augmented reality (AR) and virtual reality (VR) technologies to allow customers to visualize how products would look in their homes before buying them.
• Adopting cloud computing and data analytics to optimize operations, reduce costs, and improve customer satisfaction.

By involving different functions and teams in its digital transformation, IKEA was able to create a seamless and innovative customer journey that increased its sales and loyalty.

Lesson 2: Don’t Rush Things

Another important lesson for digital transformation is to avoid rushing into implementing new technologies without proper planning and testing. While it is tempting to adopt the latest trends and tools in the market, it is crucial to assess whether they are suitable for your business needs and objectives. Otherwise, you may end up wasting time, money, and resources on solutions that do not deliver value or even cause problems.

A case in point is GE, one of the largest industrial conglomerates in the world. GE embarked on an ambitious digital transformation project in 2011, aiming to become a leader in the industrial internet of things (IoT) market. GE invested billions of dollars in developing its own cloud platform, Predix, which was supposed to connect and analyze data from millions of machines and devices across various industries. However, GE faced several challenges in executing its digital transformation vision, such as:

• Lack of clear strategy and focus on which industries and customers to target with its IoT solutions.
• Lack of expertise and experience in software development and cloud computing.
• Lack of integration and compatibility between Predix and other platforms and systems used by its customers.
• Lack of customer adoption and satisfaction due to technical issues, security concerns, and high costs.

As a result, GE’s digital transformation failed to generate the expected returns and growth. GE had to scale back its digital ambitions and sell off some of its assets.

=> Watch more: The 4 Main Areas of The Digital Transformation Process

Lesson 3: Measure Success

A third lesson for digital transformation is to define and track key performance indicators (KPIs) that measure the impact and value of your digital initiatives. Without proper metrics, you will not be able to evaluate whether your digital transformation is achieving its desired outcomes or identify areas for improvement. Moreover, you will not be able to communicate your progress and success to your stakeholders and customers.

One company that excels at measuring its digital transformation success is Domino’s Pizza, the world’s largest pizza chain. Domino’s Pizza has undergone a remarkable digital transformation since 2010 when it launched a new online ordering system that allowed customers to customize their pizzas and track their delivery status. Since then, Domino’s Pizza has continued to innovate with new digital features and channels, such as:

• Launching a mobile app that enables customers to order pizzas with voice commands or by scanning pizza images.
• Introducing a loyalty program that rewards customers with free pizzas for ordering online or through the app.
• Experimenting with new delivery methods using drones, robots, or self-driving cars.
• Expanding its presence on social media platforms like Facebook, Twitter, Instagram, Snapchat, TikTok, etc.

To measure the success of its digital transformation efforts, Domino’s Pizza uses various KPIs such as:

• Online sales growth: Domino’s Pizza reported that more than 65 percent of its sales in the US came from digital channels in 2019, up from 20 percent in 2010.
• Customer satisfaction: Domino’s Pizza tracks customer feedback and ratings on its website, app, and social media platforms and uses them to improve its products and services.
• Market share: Domino’s Pizza increased its market share in the US from 9 percent in 2009 to 17 percent in 2019, surpassing its competitors like Pizza Hut and Papa John’s.

By measuring its digital transformation success, Domino’s Pizza was able to demonstrate its value proposition and competitive advantage to its customers and investors.

Lesson 4: IT and Business Alignment Is Key

A fourth lesson for digital transformation is to ensure that the IT function and the business units are aligned and coordinated in their digital initiatives. IT and business alignment is essential for creating a shared vision and strategy, leveraging the best technologies and practices, and delivering value to the customers. Without alignment, there may be conflicts, duplication, or gaps in the digital transformation efforts.

A company that exemplifies IT and business alignment is Netflix, the world’s leading streaming service. Netflix started as a DVD rental company in 1997 but transformed into a streaming giant by 2007 when it launched its online video-on-demand service. Since then, Netflix has continued to evolve its business model and technology capabilities, such as:

• Developing its own original content and acquiring exclusive rights to popular shows and movies.
• Expanding its global presence and offering localized content and languages to different markets.
• Migrating its IT infrastructure to the cloud and using big data and AI to optimize its operations and recommendations.
• Experimenting with new formats and features such as interactive films, mobile-only plans, or shuffle play.

To achieve this level of innovation and agility, Netflix relies on a strong alignment between its IT function and its business units. Netflix follows a culture of freedom and responsibility, where IT teams are empowered to make decisions and take risks without excessive bureaucracy or hierarchy. Netflix also fosters collaboration and communication between IT teams and business units through cross-functional projects, feedback sessions, and knowledge sharing. Netflix’s IT function acts as a strategic partner rather than a service provider to the business units, enabling them to deliver value to the customers.

=> Watch more: The definition of digital business transformation you need to know in 2023

Lesson 5: Hit Pause from Time to Time

A fifth lesson for digital transformation is to take breaks from time to time and reflect on your digital journey. Digital transformation is a continuous process that requires constant learning, adaptation, and improvement. However, it can also be exhausting and overwhelming for the organization and its employees. Therefore, it is important to pause occasionally and assess your progress, challenges, and opportunities.

One company that practices this lesson is Microsoft, one of the world’s leading technology companies. Microsoft has undergone several digital transformations since its inception in 1975. From developing software for personal computers to creating cloud computing platforms and AI solutions, Microsoft has always been at the forefront of innovation. However, Microsoft also faced some setbacks and difficulties in its digital journey, such as losing market share to competitors like Apple or Google or facing antitrust lawsuits from regulators.

To overcome these challenges and revitalize its growth, Microsoft adopted a new approach to digital transformation under the leadership of CEO Satya Nadella since 2014. One of the key elements of this approach is hitting pause from time to time and reflecting on Microsoft’s purpose, values, and culture. Nadella encouraged Microsoft employees to adopt a growth mindset that embraces learning from failures, seeking feedback, collaborating with others, and experimenting with new ideas. Nadella also promoted a culture of empathy that focuses on understanding the needs and emotions of customers, partners, and colleagues. Nadella also initiated a series of changes in Microsoft’s organizational structure, strategy, and products that aligned with its renewed vision of empowering every person and organization on the planet to achieve more.

By hitting pause from time to time and reflecting on its digital journey, Microsoft was able to reinvent itself as a more agile, innovative, and customer-centric company.

Conclusion

Digital transformation solution is a vital process for businesses that want to survive and thrive in the digital era. However, it is also a complex and challenging process that requires careful planning, execution, and evaluation. In this blog post, we have shared five lessons learned from some of the most successful digital transformation stories in various industries. 

We hope these lessons can help you navigate your own digital transformation journey more effectively and efficiently. If you need any assistance or guidance in your digital transformation projects, feel free to contact us at SmartOSC. We are a leading digital transformation agency that provides end-to-end solutions for eCommerce, digital transformation, application development, cloud computing, etc. We look forward to working with you!