How to Transform to Succeed in the Digital Economy

Succeed in the Digital Economy

In today’s increasingly competitive business climate, companies must put digital technologies at the core of their operations. In order to avoid the same fate as companies like Sears or Yellow Cab, businesses must digitize — from their internal processes to their sales channels. The good news is, most business leaders understand this. In fact, findings from AppDirect’s 2019 Digital Economy Report show that digital transformation has become the top priority for executives across industries globally.

Though a majority of companies acknowledge that digital transformation is critical to thrive in the digital economy, which includes operating in the cloud, 90 percent of executives say they face significant challenges in doing so. To help organizations make headway in their digital initiatives, let’s explore the common challenges many face and ways they can tackle them to succeed in their digital transformation journey.

succeed in their digital transformation journey

Internal alignment for digital transformation

It’s easy to get behind the idea that companies who digitally transform are more likely to succeed. However, internal alignment is never a given. For Instance, while 85 percent of executives support digital transformation, about half of them are reluctant to change. CTOs and CIOs are most supportive of their organizations’ transformation efforts while CFOs are less supportive due to the expected potential costs. Generally, though, C-suites understand it’s mission critical for their business to undergo this evolution to survive today’s increasingly competitive market.

Beyond the C-suite, champions of digital transformation are critical, too, as decision-making around huge initiatives like this doesn’t solely fall on C-suites anymore. As roles rapidly change in the digital economy, senior and middle management also play an integral role in influencing the C-Suite’s decisions. Therefore, internal alignment between all involved parties to support digital initiatives is imperative. For companies that have digital champions, executives say nine in 10 support digital transformation efforts in their organizations. For those that don’t, that number falls to about six in 10.

To best overcome this alignment challenge, find ways to have open communication with folks beyond the executive team as they will likely be the best advocates (or, if they’re not involved early on, serve as a bottleneck) to your digital Transformation Journey.

Build vs. Buy: Technology that enables seamless commerce and integrations with third party applications

In the digital transformation process, strong underlying technology is the backbone to success. However, more than half of executives shared that investing in technology, platforms and software that enables seamless commerce is the most challenging. They also cited integrations with third-party applications and services as a pain point.

When determining which tech tools are right for the company, many businesses come across the infamous ‘build or buy’ question. This debate, which has vexed companies for years, centers around whether to use internal resources to create a technology solution, or work with a third-party vendor to acquire it. Over a third of executives cited that it is the most common digital transformation challenge.

When it comes to digital commerce, businesses can build their own technology, platform and/or software. However, most choose to buy as the benefit of simplicity outweighs the time, resources and cost it takes to build a solution. That said, the first order of business for companies when approaching this challenge is to assess what makes the most sense for them. Whether they choose to build or buy, the outcome of this process should be a platform that is seamless to integrate and comprehensive in providing a unifying digital experience for businesses to modernize and optimize efficiency.

Scaling customer service and support

Once a solid commerce engine is put in place for your digital products and services, the floodgates will open for customers who can easily buy the digital products with just a few clicks. However, many businesses are finding difficulty responding to the volume of needs and demands from customers. In fact, 42 percent of executives find Scaling their customer service to be very difficult.

To find a solution to this problem, companies must have a platform that delivers not just the front-end store experience, but also back-end functions like billing, provisioning and management. An end-to-end commerce solution helps streamline every aspect of digital commerce, including enabling businesses to respond in a timely manner to the large volume of customer needs and support.

Partnering with other co-opetition in the market

For many decades, the only business strategy that seemed to work was creating products and building walls around them to keep competitors out. However, today, businesses must collaborate to provide the best value for their customers in the digital economy. This collaboration means potentially integrating with companies once-considered competitors and selling third-party software and services – something seven out of 10 business leaders say is important to meeting customer needs today.

A partner ecosystem allows businesses to accelerate innovation and create products at a pace that isn’t possible when operating alone. A majority of executives say that ecosystems are the only way to innovate quickly to meet customer demands. In fact, in the digital economy, leveraging partner ecosystems will allow businesses to grow faster and drive more revenue than those who don’t.

Today, nearly 70 percent of executives believe that in five years, only businesses that have digitally transformed will survive, suggesting digital transformation is a must, not a nice-a-to-have. While many companies are already on their digital transformation journey — driven by a desire for growth — most are still faced with these common challenges.

To overcome these barriers, companies must find internal, top-down alignment with digital champions, have a solid end-to-end digital platform that can scale customer support, and a partner ecosystem strategy. Digital transformation can be complex and at times frustrating, but it can be made less difficult by considering the options explored to succeed in the digital economy.

By Dan Saks

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