Where Are Businesses In Their Digital Transformation?
Those companies that were pacesetters in the early days of digitalization quickly realized that accelerating digital transformation gave them a competitive advantage. Digital tools are easy to integrate and easy to use. Additionally, they’re affordable and efficient.
However, many small businesses are lagging behind in adopting digital tools despite their advantages. A company that is hesitant to embrace digitization may find it difficult to remain competitive as competitors take the lead. In today’s marketplace, it’s a matter of survival. In light of the pandemic and other changes in the market, small and midsize businesses need to accelerate their digital transformation.
Take a look at what the workplace of the future will look like and discover if digital transformation is here to stay.
What does digital transformation mean in 2023?
You can’t just add a few digital tools to your existing workflows to achieve digital transformation. As it pertains to how your company functions today and how it can function better in the future, it requires a new view of reality.
Digital transformation involves replacing traditional manual processes with digital technology. The “transformation” part of the term refers to how digital tools and processes can positively transform your business.
By integrating digital technology into all aspects of their businesses, companies are transforming how they deliver value and meet the needs of their customers.
The implementation of digital transformation initiatives requires a cultural shift within your organization. The process involves asking questions, experimenting with tools and workflows, and maybe even failing occasionally. Whenever digital tools don’t work as expected, it’s an opportunity to learn how to do things better, so that’s not a bad thing either!
We’ll take a closer look at what you have to gain from accelerating digital transformation if that’s not enough to convince you.
What should businesses who haven’t started with digital transformation do?
Although many small businesses were not ready for digital transformation, the pandemic forced them to try. It is estimated that only a small percentage of small businesses are in the advanced stages of digital transformation. A small business’ ability to embrace digitalization plays a huge role in its growth. In the near future, small businesses that digitize their operations will experience unprecedented growth.
As we examine where small businesses stand and how the front-runners have fared since making the switch to digital tools, we can get a better sense of why small businesses need to accelerate digital transformation.
Cisco recently published a report that gives us a clear picture of how the pandemic has impacted the digitalization landscape. A remote workforce and better customer engagement are driving 72% of small businesses to digitize. In terms of digital transformation, only 24% of small businesses are at the most advanced stage. There are only 4% of small businesses that are digital natives. Digital transformation has been sluggish or nonexistent for 26% of small businesses.
Those statistics tell us a lot, don’t they? Business owners are more likely to embrace change when the need for change is strong.
Taking this into consideration, let’s look at how the digital transformation leaders have fared. The Cisco report research shares the following insights.
How did organizations who embraced digital transformation perform?
In the United Kingdom, the U.S., Germany, France, and Canada, small businesses contributed 48% of the GDP ($17 trillion U.S. currency). By 2024, small businesses that digitize processes could boost GDP growth by 5.6% ($2.3 trillion U.S. currency). With digitization, small businesses have been able to increase sales and recover from pandemic losses. Small businesses who embraced digital transformation have seen growth of up to eight times.
It’s prime time for small business growth. The digital transformation makes that not only possible, but lucrative as well. Small businesses that are slow to digitally transform their operations are just trying to survive, while businesses that are reaching maturity in digitalization are more resilient to market changes.
Digitalization is based on cloud technology. Small businesses need it for responsiveness and agility. When you put it all together, now is the right time for small businesses to accelerate their digital transformations. Small businesses can navigate the current environment and whatever lies ahead with the right technology providers, technologies, and expertise.
What can organizations do to accelerate digital transformation?
To accelerate digital transformation, it’s important to develop a road map for when to achieve digital transformation over the next three years. By doing this, you will be able to make more informed decisions about the best tools and processes to use.
Setting up a digitally equipped call center for sales, support, or both with a modern phone system that allows voice calling is a good idea. As part of your digital strategy, prioritize automation and artificial intelligence. Take the time to investigate the digital tools that will make the most impact on your business now and in the future. For a truly digital business, cloud-based phone systems combined with software integrations offer a complete unified communications system.
Make sure your current employees can assist the company in accelerating its digital transformation. There might be a need to add CIOs. If you’re considering hiring talent from a different geographical area, consider putting them to work in a virtual environment using digital tools.
Take advantage of an open API technology to find a quality cloud-based phone system vendor. Choosing a vendor that allows you to add and subtract digital tools as your needs change is even better.
Stay up-to-date on industry trends and technologies. The digital transformation is constantly evolving. Keep up with new tips, tools, technologies, and best practices if you want to be a pacesetter.
Your teams can customize interactions and personalize them with tools that capture data. With AI and machine learning, it is possible to keep customers engaged by gaining a better understanding of their journey.
The role of outsourcing in digital transformation
Small businesses should ask what digital transformation means for the future of work. What can we do to switch gears quickly? How will business tools and processes change in the future?
Third-party outsourcing allows you to perform it quickly and cost-effectively while eliminating overhead. Outsourcing digital transformation makes sense for a number of reasons:
1. Obtain the resources you need
If you outsource digital transformation, you’ll have enough resources at your disposal to complete your project.
Moreover, the outsourced provider is responsible for making those resources always available. As a result, you are able to focus on other aspects of your business that are crucial.
Depending on the project, you might need to hire someone with specific skills or temporarily hire someone’s services.
Thus, outsourcing allows you to manage your resources hassle-free without compromising on other aspects of your business.
2. Expertise and Experience at Your Disposal
Digital transformation requires a broad understanding of technology and subject matter. The cost of many of these skills is prohibitive, and they are only required for a limited time.
If your internal team lacks such expertise or experience, what should you do?
With outsourcing, you can tap into these capabilities and fill in the gaps in expertise. Your company lacks certain skillsets.
Third-party vendors can provide access to specialists in both mature and new technologies.
It minimizes the burden on your in-house team and gives them access to a rich pool of talent.
3. Mitigation of risks
In-house digital transformation: what happens?
All risks are entirely your responsibility. Naturally, this can make anyone nervous. Right?
When the project involves technologies/solutions your team is unfamiliar with, this becomes more challenging.
When you outsource, a third party shares your risks. Moreover, if the outsourced team has experience with similar projects, the risk will be lower.
4. Security and equipment improvements
Legacy systems are incompatible with new technologies in many businesses.
As a result of outsourcing, you won’t have to make a large initial investment and you’ll have top-notch, modern software and equipment at your disposal.
Additionally, knowledgeable outsourcing companies already use the most up-to-date security measures to protect your business from cybercrime.
5. Multi-domain experience
You can gain hands-on experience in fintech, gaming, telecommunications, healthcare, insurance, hospitality, and manufacturing through outsourcing.
However, I am sure you will agree that digital transformation in two different sectors will not be the same. In banking, for example, digital transformation can be very different from that in education.
Moreover, adopting digital tech in a particular sector requires specific expertise.
It is therefore important to work with a vendor who has previous experience in your industry and is knowledgeable about it.
6. Efficiency in terms of cost and time
Outsourcing eliminates the need to purchase expensive licenses, software/hardware, and rent and other office expenses.
You can focus on other internal business processes while your outsourcing partner takes care of all these work aspects.
7. Establish new business connections and opportunities
A foreign market with a wider reach (sometimes global), useful contacts, a richer talent pool, innovative technologies, and potential revenues are all advantages of outsourcing.
It is imperative for small businesses to innovate their workforce strategies in order to prepare for the future of work. As a result of necessity, many workers have adapted to remote working environments. In the end, digital transformation helps companies evolve their workforces. As a matter of fact, small businesses may favor employees who can work independently and remotely.
Digital transformation challenges are more prevalent among small businesses that rely on in-person interactions (restaurants, entertainment establishments, etc.). Digital communication channels or virtual experiences have been used by the most innovative businesses to engage with customers.
How do you select the perfect outsourcing partner? If you need help in finding the right outsourcing partner, book a FREE APPOINTMENT with Outsource Asia experts today.