What Is “Transformation Process” In Business?
Digital transformation in a business is simply defined as a business making a change from traditional ways of manufacturing, engineering, selling, and marketing products to using digital tools and solutions for these processes. For example, companies used radio, television, magazines, and travelling salesmen for marketing in the old days.
However, with the advent of the internet, companies now have access to digital marketing resources like emails, search engine optimization, and social media for marketing.
Similarly, other examples like the transition from producing CDs for record labels to producing digital albums and also artists transitioning from producing physical paintings and sculptures to producing digital arts all reflect the concept of digital transformation.
But it is important to note that digital transformation is not just about moving from analog/physical processes to digital processes, such as moving from placing an advert in a newspaper to advertising on Tiktok, it is also a transformation of digital technology itself. For example, the internet moved from being driven by web1 technologies to web 2 products and is set to be driven by web 3 products such as blockchains and cryptocurrencies. Social media itself is moving from web 2 applications like Twitter to blockchain-based platforms like Bitclout that allow you to earn money based on your reputation. So you see that it is so much more than just moving from analog to digital channels.
Processes of Digital transformation.
If you are trying to transform your business digitally, you must take note of the changes mentioned above in products and processes. The following are the processes of digital transformation in business.
1. Business Model transformation
Digital transformation involves a change in the business model, i.e., how businesses deliver value. For example, with the invention of internet-enabled mobile phones, bookstores changed from selling only hardcover books to creating digital copies of books that readers can read on their phones or digital devices. Record labels also changed from printing music CDs to digital music. NFTs are an example of the transformation of photographers and art creators, moving from selling physical sculptures to selling digital products.
2. Business Domain Transformation
Through customer feedback and research, many businesses have transformed from one particular kind of business to another. Business domain transformation simply means changing the What, Where, Why, Who, and How of your product. Amazon, for example, was an e-commerce platform that pivoted into a streaming service called Amazon Prime. Now the company still retains its e-commerce business and has millions of users. The streaming service has plenty of subscribers, and Amazon also pivoted into AWS, which provides cloud services.
The business redefines the company product in domain transformation and enters news markets. Domain Transformation is one of the areas where businesses can grow.
3. Process Transformation
Nowadays, the goal of businesses is to reduce manufacturing costs, make better use of marketing and sales tools, interact with customers, get better feedback on products, and increase ROI. Therefore, process transformation is not about the product or what the business wants to do; it is about how it does them. For instance, the concept of virtual work with the creation of digital tools and channels is an example of process transformation.
The transformation of financial transactions from digital money on centralized servers to cryptocurrencies on decentralized servers is an example of process transformation. The transformation from traditional marketing tools and ideas to digital marketing is also noteworthy. For example, in the past if you were hungry and needed food, you would have to walk or drive yourself to your nearest restaurant to get food.
These days most restaurants have apps that allow you to order whatever you wish to eat from the comfort of your location. Another aspect of process transformation is digital collaboration. Companies now work with other companies to help them carry out digital processes. For example, in the old days, you have to work at a company to have access to any of its processes, from manufacturing to sales. These days companies are happy to outsource to experienced freelancers on some required digital processes.
4. Business Culture Transformation
Perhaps the most important transformation process for any business is business culture transformation. This process is what makes the three other areas mentioned successful. A business can change its mindset in terms of approach to talent acquisition and employee management, flexible workflow, a digital and collaboration mindset, and decentralized decision making.
On the other hand, business transformation can also focus on critical thinking and diversity hires. For example, as the business environment becomes decentralized, many more businesses are changing their business models, processes and the people they hire. For example, many more companies now hire women and minorities as they look to bring their products to new markets.
The C-suites of many businesses are now becoming younger in age as more youth take advantage of digital transformation to start businesses, and innovations marketed at young people now have youth spearheading them to reach their audience. As a company looking to implement a digital transformation process, you need to find the right balance between your technology and your talent and empower your employees to use digital tools to improve your business outcomes.
It is also worthy of note that digital transformation does not mean abandoning traditional processes for the digital process. For example, while companies now mostly use digital marketing processes for adverts, they still use product placement in traditional media. Both conventional methods and digital processes can work together. The key thing to do as an employer is to find the balance.
Conclusion
From our discussion, we have been able to establish that digital transformation is a fluid process. From the read-only products of web 1 and its processes to the interactive platforms of Web 2.0 to the currently user-centric platforms of Web 3.0. Several macro and micro innovations happen in the digital space all the time, making the processes of transformation continuous and opening up new opportunities for businesses to transform their operations for better outcomes.
Depending on how open to innovation you are, business transformation can be difficult or easy, but your flexibility and openness to ideas will make it easier for your business than most.
We can help you begin your transformation journey in a very seamless way. reach out to us today to book a free consultation session.
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