Digital transformation is about to change the way business is conducted.
According to Altimeter’s report, “Digital Transformation: Why and How Companies are Investing in New Business Models to Lead Digital Customer Experiences,” there are important trends and goals in digital transformation that benefit all businesses seeking to adapt to digital markets in meaningful way.
Customer is king, the report says, yet in an era of “Digital Darwinism” where technology, society, and business models rapidly evolve, customer experience is often elusive.
“Businesses are beginning to realize that, throughout their evolution, they must invest in change to keep up with and ultimately lead a new era of connected markets,” the report says. “As a result, businesses are now entering an era of ‘digital transformation’ to integrate and improve the customer experience.”
But to accomplish this, companies need to understand the considerable differences between traditional customer strategies and those required to engage and nurture relationships with digital customers.
Understanding the digital customer experience is one of the primary catalysts for businesses placing substantial investment in digital transformation, the report says.
“Our research details what digital transformation is, how companies are embracing change, and the challenges and opportunities that emerge throughout the process,” the report says. “Our findings represent important trends and goals in digital transformation that benefit all businesses seeking to adapt to digital markets in meaningful way.”
Here are seven significant findings from the report:
Social, mobile, real-time, and other disruptive technologies are aligning to necessitate bigger changes than initially anticipated.
Digital transformation is quickly becoming a priority for many leading organizations.
Mapping and understanding the customer experience is becoming critical in guiding transformation efforts.
While gaining momentum, digital transformation as a formal process is still in its infancy.
Digital transformation is driven partly by technology and also by the evolution of customer behavior.
Three key elements form the compound upon which digital transformation efforts are built:
• It is most effective with pointed vision and supportive leadership.
• Optimizing the digital customer experience becomes the initial objective.
• Change materializes through the formation of a digital transformation team
A list of best practices will serve as a checklist to help strategists take the next steps to beginning digital transformation or optimizing current efforts.
“From CEOs to CMOs, to the new roles of Chief Digital Officer and Chief Experience Officer, companies are refocusing and reorganizing teams to modernize, optimize, and integrate digital touchpoints,” the report says. “This affects the roles and objectives of marketing, social media, web, mobile and customer service, as well as how these typically disparate groups work in harmony. The ambition is to make their businesses relevant in a digital era while growing.”
Digital transformation is not a fad or a trendy moniker to signify rising investments in social and mobile, according to the report.
“While other research around the topic may focus on technology investments to solve problems, we believe that digital transformation is bigger than that: Organizations are truly changing from the inside out,” the report explains. “Digital transformation is a result of businesses seeking to adapt to this onslaught of disruptive technologies affecting customer and employee behavior. As technology becomes a permanent fixture in everyday life, organizations are faced with an increasing need to update legacy technology strategies and supporting methodologies to better reflect how the real world is evolving. The need to do so is becoming increasingly obligatory.”
Digital transformation represents the next big thing in customer experience, the report says.
“Those companies that ‘get it’ and invest more in learning about their digital customers’ behaviors, preferences, and expectations will carry a significant competitive advantage over those that figure it out later (if at all),” the report says. “In its own way, digital transformation is making businesses more human. As such, digital transformation is not a destination. Instead, it’s a journey that continually seeks out how to use technology in ways that improve customer experiences and relationships.”
What’s more, the report says digital transformation also represents an effort that introduces new models for business and, equally, creates a way of staying in business as customers become increasingly digital.
From September 2013 through February 2014, Altimeter interviewed 20 executives and social strategists at 14 companies about their experiences in adapting to the new digital customer experience.