Digital Transformation - Page 11 of 18 - Changing habits in your organization

Digital transformation starts with the adoption of digital tools

01/07/202412/05/2023 by DX Talk

Digital transformation starts with the adoption of digital tools. In this second installment of Digital Transformation Process: A Key Guide to Success, we explore the historical evolution of digital tools and their impact, changes in the post-COVID-19 workplace, and the impact of the proliferation of remote work on digital transformation (DX, DT, Industry 4.0). Learn how small changes that start with the adoption of digital tools can lead to big workplace efficiencies.

Historical changes in digital tools and their impact

There are many factors that have influenced the productivity of office workers over the years. If we had to pick one tool that has had the biggest impact, especially in the last 30 years, we’d have to say digital tools.

Let’s go back to the late 1980s and early 1990s. As PCs began to be utilized in corporate offices, documentation that had been done by hand or on typewriters went digital. Then came Microsoft’s Excel and PowerPoint, which not only changed productivity but also changed the way we work. We spent less time looking for information. Calculation errors were reduced as numbers were managed in Excel.

How communication has changed since the 2000s

The 2000s brought the internet. The change in communication represented by email was revolutionary: before, people used to communicate via landline phones or, if necessary, by mailing paper documents back and forth. But now, email is at the center of it all. Today, we are constantly sending and receiving emails.

The rise of mobile and workplace productivity

The proliferation of mobile environments in the 2010s also brought about a major shift. The shift from wired internet on desktops and laptops to mobile devices on smartphones has led to another boost in productivity. For example, email communication, which was once limited to wired environments, is now possible anytime, anywhere in the mobile era. There was a time when BlackBerry was the dominant smartphone in North America before iPhones and Android phones took over the market. The BlackBerry’s core feature was real-time messaging. Many office workers flocked to BlackBerrys because of their ability to communicate in real time. Now, mobile-based messengers, cloud services, and more have evolved the workplace.

COVID-19 and rapid changes in the workplace

The COVID-19 pandemic that swept the globe in 2020 changed the way we work even more rapidly. Conference calls and video conferencing, which were once only possible with expensive, dedicated equipment like Polycom and Cisco, have given way to mobile services like Zoom, Microsoft Teams, and Google Meet that are accessible to everyone. At the same time, telecommuting and remote work have become accepted as part of the workplace.

The rise of remote work and the importance of digital tools

We’ve been hearing a lot of talk lately from tech companies about increasing the amount of telecommuting and remote work. This is because they’ve found that employee satisfaction is high and productivity hasn’t dropped significantly, regardless of COVID-19. These changes are, in turn, driving the use of digital tools. Chat and video conferencing for communication, traditional email and calendar sharing, and cloud-optimized file sharing, document creation, and collaborative editing.

In addition, digital tools such as task management and project management tools for to-do and work management are not just being used internally, but also by partners and collaborators outside the company, and it has become difficult to work together without them. We started using Google Workspace (formerly known as G Suite) and Microsoft 365 as collaboration tools, and we started using Teams and Slack for communication.

Are these changes just a complement to remote work? They may have been triggered by remote work, but the end result is a fundamental shift in the way we work. Until now, we’ve been using digital tools on a case-by-case basis in the name of personal know-how. But after COVID-19, digitizing work became a company-wide task. Projects that used to be managed like a diary in Excel have become much more convenient and intuitive with the use of ‘project management tools’. This change has not only affected IT companies, but all companies regardless of industry.

Digital Transformation: Start Small, Make a Big Difference

DX doesn’t have to be intimidating. Just by digitizing the way you’ve been working, you can increase your productivity. Simply adopting many of the tools mentioned above can make a big difference. When a new employee joins your team, should they start by going through an orientation and being handed a bundle of shared documents by the youngest person in the department, or should they learn about the conversations, deliverables, and decisions that have gone into a project from the top down in a digital workspace like Slack?

If you’re comparing apples to apples, the answer is already clear. DX starts with changing the way people work. Changing tools changes the way they work, and everything they do leaves behind data. Another way to look at it is that it’s about increasing business continuity. As a result, you can take on bigger challenges like changing your business model. In this way, DX is about starting small, expanding items like a game journey, and dreaming of ultimate change.

Steps to digital transformation success: start small and fast

01/07/202412/05/2023 by DX Talk

Steps to digital transformation success: start small and fast. First Steps to Digital Transformation Success: Small, Quick Start, the first in the Digital Transformation Process: Keys to Success guide, helps you understand the importance of transforming your business model through digital transformation (DX, DT, Industry 4.0) and emphasizes the importance of an incremental approach with success stories from Starbucks and Rolls-Royce. Learn how to start your DX journey with Small, Fast Steps.

Understanding the success and importance of digital transformation

Most organizations that are interested in digital transformation (DX) often set fairly ambitious goals from the outset. This is because the digital transformation success stories that have been shared in the market so far have focused on business model transformation. There’s also a sense of expectation on the part of executives that DX will do something magical. But like all things, the DX journey is a step-by-step process.

A successful business model transformation story: Starbucks

Let’s take a look at some of the best examples of successful business model innovation through DX. (DX examples) First of all, in the B2C field, Starbucks is the best example. Starbucks added a mobile service called “Siren Order” to its business model of selling coffee in offline stores. The idea was to move from in-store, face-to-face ordering to mobile ordering.

Starbucks also created Starbucks Pay, which allows you to make deposits and use them to pay in-store, as well as a loyalty program and various rewards programs, all through a mobile app. Now, Starbucks is naturally collecting customer information and will find new ways to use it.

Several recent research reports have called Starbucks the most powerful fintech company in the world. In addition, with the recent increase in drive-through stores, Starbucks is now offering a service that connects your license plate to your existing Starbucks membership, allowing you to pay by simply scanning your license plate without having to open the app. DX is at the core of Starbucks’ mobile-centric business.

Innovation in B2B: Rolls-Royce’s approach

The next example we’ll look at is in the B2B space, with Rolls-Royce‘s aircraft engine business. Unlike automobiles, aircraft engine sales work on the basis that when an airline places an order to build an airplane, it specifies which engine it wants to use, i.e. when Korean Air buys an airplane from an airplane manufacturer like Boeing, it orders the airplane to be built with a specific brand of engine. Like most manufacturers, Rolls-Royce’s business model is to manufacture and sell aircraft engines and then provide maintenance services.

More recently, however, the company has been adding a variety of sensors to its engines and using the data it collects to provide maintenance services. An aircraft engine generates 20 terabytes of data in one hour, which is a huge amount of data if you assume that an airplane has two engines and flies for an average of six hours. The idea is to use this big data to diagnose aircraft engine faults.

This is a very important service that can save a company a lot of money in terms of preemptive checks before an actual engine failure occurs. Rolls-Royce has also created a business model that is tied to a performance system that rewards airlines for reducing their losses due to engine failures, meaning that if they can reduce what could have been a week of downtime through big data analytics and proactive maintenance, they get a share of the airline’s revenue.

It could be argued that they are actually charging for the time an aircraft engine runs. Rolls-Royce has created a new business model by moving from the traditional model of manufacturing and selling airplane engines to charging for time spent in service.

An incremental approach to digital transformation

As you can see from the DX journeys of Starbucks and Rolls-Royce, their business model transformation didn’t happen overnight. It took a lot of trial and error and constant execution to refine it. Whether you’re a mid-sized company, a large enterprise, or a startup, these business model shifts are based on years of investment and experimentation.

While it would be great if all companies could follow the same steps and navigate the DX journey, that’s not the case, which is why we recommend that manufacturing companies start by digitizing the product itself. It’s about connecting your product to the internet and thinking about what information it can collect and, conversely, what information it can provide.

In the case of Rolls-Royce, we’ve already seen how the company transformed its business model from engine manufacturing to a data-driven service business. They started by connecting their products to the internet, which is to say, they started with what they were good at and gradually incorporated digital technologies and ultimately transformed their business model.

What if you’re struggling to digitize your flagship product internally? If so, you may want to consider DX as a way to streamline your operations, not as a new business model. Operational streamlining means reducing various costs in a company’s operations. If the application of technology in the value chain of planning, development, operation, production, quality, and marketing improves productivity and reduces costs, this is also a great DX journey. Automating production processes centered on the know-how and experience of skilled workers by utilizing digital technology, even if it improves the yield of the production process by 1%, will result in tremendous added value for the company.

Other activities include analyzing customer review data after a product has been produced and sold, or tracking usage data of internet-connected products to detect abnormalities early and prevent quality incidents such as recalls. In addition, predicting the number of sales of flagship products and estimating the storage period of accessories for product repair are other areas that can be streamlined through DX. For companies producing consumer products such as food and cosmetics, instead of conducting FGI (Focused Group Interview) in the market research process, they can mechanically collect various comments on SNS and analyze them to derive insights. This is also the journey of DX.

Digital transformation starts with small goals

The ultimate goal of DX is to create the conditions for a company to always be able to shift to a new business model that allows it to continue to grow. However, if you aim too high from the start, you can end up spending money and not seeing results, or failing to implement DX due to internal resistance. Instead, it’s best to start with small goals that you can implement in a short amount of time and see immediate results.

Digital Transformation Process: A Key Guide to Success

01/07/202412/05/2023 by DX Talk

Digital transformation process: a key guide to success. Digital transformation is more than just the adoption of technology; it requires a fundamental change in your organization. As the third process change in Digital Transformation: Changing organizational habits, this article takes a closer look at the key processes for successfully driving digital transformation.

1. Start with small digital transformation goals

The journey of digital transformation starts with setting small goals. This approach helps you build the step-by-step process you need to achieve your big change goals.

1.1. Step-by-step approach

It’s important to set realistic goals for each phase. For example, in the first phase, you might aim to select and adopt digital tools. In a later phase, you might use these tools to improve specific work processes, and in the final phase, you might see how these changes are integrated throughout the organization.

1.2. Small experiments

Start with small projects and make incremental improvements based on feedback and learning along the way. For example, you might try out a new digital tool in one department, analyze the results, and look for ways to apply it across the entire organization.

2. Adopt digital tools

One of the key elements of digital transformation is the adoption of the right digital tools.

2.1. Choose a technology

It’s important to choose the right technology for your business goals and organizational needs. For example, you might adopt a CRM system to improve customer management, or a collaboration tool to enhance internal communication.

2.2. Build an adoption plan

Your tool adoption plan should be specific and organized. It should include employee training, technology integration, system updates and maintenance, and more. It should also clarify how the new technology will be integrated into existing workflows.

3. Things to keep in mind when adopting tools

When adopting digital tools, it’s important to keep the following in mind

3.1. User-friendliness

The tools you introduce should be user-friendly – this is a key factor in making it easy for employees to adopt new tools and use them effectively. Make sure the user interface is intuitive and that the features you need are easily accessible.

3.2. Security and compatibility

Security is a very important consideration when adopting digital tools. You need to make sure that the tool is compatible with your existing systems and can keep your organization’s sensitive data secure. You should also consider whether it complies with laws and regulations related to data privacy.

4. Process visibility

An important aspect of digital transformation is not simply replacing existing processes, but making them more visible and easier to understand.

4.1. Transparent operations

By making processes visible, operations within your organization become transparent and understandable to all members. For example, you can adopt a workflow management system to visualize your work processes and get a clear picture of what’s happening at each step.

4.2. Continuous improvement

Visualized processes make it easier to identify and resolve problems. It allows you to improve inefficiencies, continuously optimize processes, reduce employee resistance to change, and increase understanding of new systems or processes.

5. Introducing the startup process

Bringing the processes of innovative startups into your digital transformation can bring new energy and ideas to your organization.

5.1. Agile approach

Startups have the flexibility to respond to rapidly changing market conditions. This agile approach can also be adopted by large organizations, enabling them to make quick decisions, work adaptively, and implement innovative ideas.

5.2. Learning from failure

Startup culture encourages an attitude that sees failure as a learning opportunity. When you bring this culture into your organization, you won’t be afraid to fail, and you’ll be able to try and experiment to find a better way. This can go a long way in driving innovative growth for your organization in the long run.

We’ve talked about how the journey of digital transformation starts with changing your processes to change the way you work, changing the way you work to change your people, and changing your people to change your business model. Processes are the first area to start. However, many companies don’t understand how to change their processes. We’ll be exploring these challenges in a series of articles.

By taking a step-by-step approach, choosing and adopting the right tools, and considering the things to watch out for, digital transformation can bring positive change to your organization and drive growth for your business. Through this process, organizations can change to keep pace with the digital age and gain a competitive advantage. By making the process visible and adopting the agile approach of a startup, digital transformation can be more effective. With these strategies, organizations can adapt to the rapidly changing digital landscape and pursue sustainable growth and innovation.