14 Sep, 2022

Why Digital Transformation is Significant for Businesses

Digital Transformation is a recurring term in today’s business atmosphere. But how does it gain so much significance? Why do most businesses turn to Digitalization? How digital transformation benefits businesses? 

It was during the Covid-19 outbreak that most businesses dramatically shifted to online channels.  As consumers preferred online shopping, businesses found no other way than to digitally transform. Enterprises that planned digital transformation within one to three years have rapidly digitalized their process in a matter of days or weeks.  

According to a survey conducted by McKinsey&Company, a global business management consultant, there was a rise in digitalization during the pandemic. Over businesses, the greatest jump in digitalization is the issuance of shares that are digital. The average share of products or services that were partially or fully digitalized before Covid-19 was 35% and during the outburst, it rose to 55% globally.  

In the Asia-Pacific region, it climbs from 33% to 54%. It was 34% in Europe before the pandemic and it rose to 50% during the pandemic. Whereas in North America digitalization was 41% and then it became 60%. (How COVID-19 Has Pushed Companies Over the Technology Tipping Point—and Transformed Business Forever, 2021)  

What significant cause has led businesses worldwide to shift to digitalization? Before diving deep into these details, we must know what exactly digital transformation is.  

Digital Transformation

Digital transformation is the method of bringing key changes to organizations through technology. The significant changes include developing new or improving current business processes, traditions, and customer experiences to satisfy varying marketing and business needs. This restructuring of business is termed digital transformation.  

It beats the conventional areas of sales, marketing, and customer service. With the progress from paper to spreadsheets to smart applications, we were able to rethink business processes and customer engagement using digital marketing. It increases efficiency and has greater business agility.

Digital transformation includes AI introduction and cloud computing to improve customer experience. It modifies the supply chain to better utilize machine learning. There are two concepts in digital transformation.

They are: 

• Digitization: The method of transforming analog data into digital form. In simple terms, the conversion of physical objects including texts, images, or sound into a digital form or its digital representation that can be processed by a computer is termed digitization. For example, developing spreadsheets as per the details on the paper records. 

• Digitalization: Employing digital technologies to simplify business processes and projects. For example, using cloud software like NetSuite ERP for managing operations including financials, CRM, eCommerce, and Inventory.

Digital transformation needs a change from conventional ideas to a more combined developmental approach. This approach exposes new solutions which in turn can enhance user experience, steer employee invention and drive business growth at the basic level. 

Why Digital Transformation is Significant  

Digital transformation improves the way an enterprise processes. This includes the systems, operations, culture and workflow. This change impacts every part of a firm and combines data from different sections to operate together more efficiently.

For instance, enterprises can get a complete picture of client journeys utilizing workflow automation and advanced processing including artificial intelligence (AI) and machine learning (ML) which was impossible before.  

Reduced cost is the major reason for many companies to transform digitally. Transferring data to a social, reserved or combined cloud environment reduces functional costs. It clears hardware and software charges and helps team members to focus on other major tasks. 

Digital transformation found its place even before the pandemic. But during the Covid-19 outbreak, the transformation that was assumed to take a long time had to occur only in a few months. It enabled businesses to survive the disruptions in the work and business environment due to the pandemic. 

As per Dell’s digital transformation index, which estimated over 4300 business administrators worldwide, eight in ten firms urged digital transformation programs in 2020. 80% of organizations accelerated at least a few digital transformation operations during the year. In this era technology is a must for every business.  

Major Reasons for the Significance of Digital Transformation

• Everyone expects an on-demand service

• Employees require modern tools to be effective

• Security is a major business priority

• To harden business partnerships  

• Make better decisions faster

Benefits of Digital Transformation 

1. Enhanced Data Collection  

A system for getting the right data and completely including it for business intelligence at a larger level is developed through digital transformation. 

It forms an approach through which numerous functional divisions in an organization can transform incomplete data into information across various stages. This creates a unified view of processes, creation, capital, and marketing prospects for the customer journey.  

In terms of your digital transformation, think about how you can lend your clients more authority over their own details. Consumers are mindful of how their data is gathered and used, and this makes them worry. Show them you care about their information by putting in place strong privacy rules and letting them change their minds at any time.  

For example, using NetSuite Cloud ERP your data can be backed up and obtainable at anytime and anywhere according to your requirement.  

2. Powerful Resource Management

Through digital transformation, information and resources are put together into a set of business tools. It keeps software and databases from being spread out across the company and cuts down on vendor overlap. Through digital transformation, applications, databases, and software can be put together in an omni-channel to help with business intelligence.

Digitalization is not a sector or an operative unit. It affects every part of a business and can lead to new ways of doing things as well as more efficient use of resources across units. Every department uses sensitive data, from trading and marketing to finance and the C-levels. It is crucial to enhance and protect data wherever it goes. Also, give tools that are easy to use so that the job will be easy. 

An example of a powerful resource management tool is the SRP module of NetSuite cloud ERP. This tool allows businesses to allocate resources to projects easily through consolidated, latest profiles of talents, preferences, expertise, and job priorities. Project managers can affirm that the appropriate personnel are assigned to the appropriate projects. 

3. Improved Customer Experience      

Think about how your digital transformation can not only make your teams more efficient but also give your customers better, more seamless experiences. This includes everything from emails and user portals to digital products and how often you reach out to new prospects.  

Customers have great anticipations with regard to the digital experience. Consumers are used to having a lot of options, obtaining better deals, and getting their goods quickly.

The cloud ERP, NetSuite Customer Relationship Management (CRM) delivers an entire view of customer information. It enables customers to solve common problems themselves with a customer-center and obtainable knowledge base.

4. Facilitates Digital Culture

Digital transformation empowers a digital culture by granting team members the proper tools for their environment. While these tools make it easier for people to work together, they also help the whole organization move forward digitally. This change in digital culture is significant for businesses to stay in the field. It makes team members learn new skills and how to use technology so they can take advantage of the benefits of digital transformation.

The digital transformation helped employees to work remotely when the pandemic outburst. It facilitates businesses to continue their processes unhindered with the assistance of different digital tools.  

5. High Profits 

Businesses that adapt to digitalization increase efficacy and profitability. According to the reports by the SAP Center for Business Insights and Oxford Economics (Nakamura, 2022):  

• 80% of firms that digitally transformed in 2018 stated their increase in profits. 

• 85% reported their progress in market share in the year 2018.

6. Enhanced Productivity  

Proper tech tools that operate together can speed up your work and increase productivity.  It enables team members to work faster and better by automating manual processes and combining data across the firm.   

Role of ERP in Digital Transformation

Regardless of your particular requirements, ERP software assists in changing your business for digital transformation. ERP can assist you to enhance your business through modern technology.

It has an inevitable part in digital transformation. ERP has the potential to bring about revolutionary changes in many business processes.  

Digital transformation means changing your organization by making improvements to how it works. ERP software ties together all your business operations, making them more efficient, faster, and better for your customers. In simple terms, your ERP software is the basis of your digital transformation.  

An ERP platform that assists you with combining orders, inventory, accounting, returns, and shipping, helps to improve your customers' experience. A software platform to build on helps you to change how your employees, customers, and vendors deal with new technology. 

NetSuite Facilitates Digital Transformation 

After the digitization of every business there comes digitalization with the help of accounting software. The completion of all this process forms the real digital transformation with the cloud ERP software like NetSuite.  

The NetSuite cloud ERP software lets you assess:  

• Use data to help you make strategic decisions.   

• Gain visibility into processes.

• Betters the customer experience to digitally transform your business.

• How your resources work. 

• Automate the project.

• Make the most of your inventory. 

Best wishes on your digital transformation journey. If you need any assistance, we are here to assist you. 

Feel free to contact Jobin & Jismi. We are the solution providers of Oracle NetSuite with a decade of experience. We have experts to assist you better. 

References:

1. How COVID-19 has pushed companies over the technology tipping point—and transformed business forever. (2021, February 18). McKinsey & Company. Retrieved September 11, 2022, from

https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/how-covid-19-has-pushed-companies-over-the-technology-tipping-point-and-transformed-business-forever

2. Nakamura, M. (2022, August 9). Digital Transformation Executive Study: 4 Ways Leaders Set Themselves Apart. SAP Insights. Retrieved September 12, 2022, from

https://insights.sap.com/sap-digital-transformation-executive-study-4-ways-leaders-set-themselves-apart/  

3. Oracle NetSuite. (2022, January 6). NetSuite Customer Service Management. Retrieved September 13, 2022, from

https://www.netsuite.com/portal/products/crm/customer-service-management.shtml 

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