August 21, 2020

8 Common Challenges of Digital Transformation

Your business requires a digital transformation if you want to stay ahead of the game and your competitors. This is especially true for companies that have been in existence for almost a decade or more. New and innovative companies are constantly emerging, and without a little competitive nudge, your business is bound to stagnate if not retrogress. It would be a great disservice for your business to be overtaken by younger companies who were probably inspired by your innovations. To better understand the need for change through digital transformation, let’s first look at its nature for clarity.

Albert Einstein famously said, “The measure of intelligence is the ability to change.” Those who refuse to adapt to the changing times are often left behind. On numerous occasions, even history has reminded us through the adaptation or survival theory, as illustrated by one of the greatest scientists, Charles Darwin. The adaptation theory is based on an organism’s ability to adapt to changes in its environment and adjust accordingly with time. In short, it is what we popularly refer to as survival of the fittest.

Without adaptation and transformation, extinction becomes the next natural course of action. So how do organisms adapt to the ever-changing environmental conditions? There are three forms of adaptation, which we shall briefly address.

Structural Adaptation

This type entails a physical change in the organism, often related to a change in the organism’s environment. For instance, if an area suddenly becomes prone to wetness, an animal might develop webbed feet to wade through the water.

Behavioral Adaptation

This type of adaptation refers to a change affecting how an organism naturally acts, which can be due to a shift in the nearby area or another species’ actions. For instance, if a pack of animals disintegrates and the members start to hunt separately, the prey species can choose to form packs to fend off the solo predators. This survival tactic can tremendously improve their survival chances.

Physiological Adaptation

Similar to its structural counterpart, physiological adaptation also entails a physical change to an organism. However, these changes are not visible to the naked eye. Instead, they happen within the organism’s body. For example, if wild animals notice that their pack members are captured and killed after interactions with humans, they become more intelligent and avoid human contact.

digital transformation challenges

Once we fully understand the adaptation theory, we can then begin to apply it in our lives and in business operations to move with the changing times. It is essential to note that digital transformation is more than just buying fancy gadgets, adopting new digital technologies, or upgrading existing systems. Smart companies take the initiative to plan and predict possible outcomes. As a leader, you will need to answer the following questions as your forge ahead:

  • Where is your company now?

  • Where do you want it to go?

  • What do you need to do to get there?

1. Time and Budget Constraints

Not to be taken lightly are budgetary constraints. Wouldn’t it be a dream come true to never worry about financial constraints? Your company would be untouchable if not unbeatable. 

Whether your company is a non-profit, small scale, or corporate, funding plays a massive role in your business operations. If your business challenges are directly related to funding, then money is your only solution. A deficiency in finances will significantly affect or hinder your company’s much-needed digital transformation.

Although it may not always be possible to have funding at your disposal for all your projects, you must plan for any contingencies. In conjunction with the finance crew, your strategy team will play a crucial role in devising and allocating funds for this transformation. As with all business processes, your team will need to be careful and smart. Your budget will give you a required reality check. Nonetheless, this is not to discourage you, but to show you how much your company can handle.

You need not jeopardize your current business to make these changes. If the current budget is insufficient, work out a plan that’s achievable within a stipulated period. Your plan can entail injecting money into your marketing strategy, content strategy, and even employees to boost your income. You should not take digital transformation as an instantaneous affair, but rather a continuous journey to improve processes. Adopting this mindset will result in success, and as suggested by Charles Darwin’s theory of adaptation, as a dynamic process.

2. Full Visibility of the Customer/ User Experience

Most bigwig companies have had to adjust their business strategies to change with their clients’ demands. Those who failed to do so ultimately were left behind to marinate in their ambivalence and rigidity. If your customers are not pleased with your products or services, be sure that they will jump ship. This migration will not only be a loss for your company but a win for your competitors. It will even be twice as hard to win back lost clients.

Fortunately, this is all preventable. Employ business analysts and strategists to study the market, i.e., your customers and rivals. This move will give you a better understanding of what your clients want and what other companies are doing to pull in the crowd. Where possible, you can even conduct a physical or digital survey of your clients. Ask them what they like about your company, what they don’t like about it, and what they feel you can improve on. You’ll be surprised at the numerous business solutions you will find. After all, the clients are the sole reason your business is still in existence.

customer experience

A study done by the US Census Bureau in 2019 revealed that millennials (also known as Gen Y, ages 23 to 38) had overtaken the Baby boomers’ (ages 55 to 73) and Gen X’s (ages 39 to 54) population. Millennials stand at 72.1 million, while the Boomers and Gen X stand at 71.6 million and 65.2 million, respectively. This directly means that your company will need to shift its customer focus to the millennials who adore social media. You can’t claim you’ve undergone a digital transformation if your company does not have a digital footprint on LinkedIn, Twitter, or Facebook. Here you can engage with both local and international customers in real-time. You can also use social media influencers and bloggers to boost your sites’ traffic and beat your competitors.

3. Complex IT Structure and Integration

Digital transformation will bring numerous changes, some of which will significantly affect the company’s structure. This change does not necessarily mean that people will lose their jobs, but that roles may need to be redefined. The quality of leadership in a team directly affects the team’s performance. Changing your department heads, redefining your employees’ roles, and amending some of your company rules can tremendously reignite your company’s performance and operations management.

Similarly, if you want your company to survive and succeed, you will need to introduce necessary changes to your digital culture proactively. You will need to collaborate with other stakeholders to modify existing technologies and structures to break all success barriers. For instance, if you change your IT heads, your projects should continue seamlessly. Having a united vision with your whole team will result in satisfied customers, and consequently, positive reviews.  

4. Employee Pushback and Availability of Skilled Personnel

Have you ever noticed how some people tend to follow a particular routine, regardless of whether they are at work or on holiday? “Why?” you wonder. It’s pretty simple: comfort. Such people end up very disoriented, and others even upset when their routines are disrupted. Whether in your personal life or business affairs, following such rigid tactics can, at times, lead to failure. You can quickly be left behind as the rest of the world takes enormous strides.

Nothing new ever came out of comfort. Necessity, however, is the mother of invention. But how does this apply to your business? By getting out of your comfort zone. If you want to join other top-notch companies in their success, try taking risks. This is not to mean that it will be an easy feat. You can expect your employees to be hesitant to support the changes. Nonetheless, reassure them of the need for change, and also train them on the new systems. Within no time, everyone (including your customers) will see and appreciate the difference.

5. Company Culture and Resistance to Change

Every organization, whether intentionally or not, has its practiced culture. Culture can be anything really, from simple things such as stipulated working hours and contract durations to communication channels and professional hierarchy. These are among the first nuggets of information that new employees acquaint themselves with before immersing themselves into the new job. Acquiring these helpful nuggets can also be referred to as survival tactics.

Although you will likely face resistance from some of your staff, the vast majority who are smart enough will be grateful. Remind them to see the change as an opportunity to learn and diversify their knowledge. To establish a stable future for your company, you should break down all complex structures and simplify them such that the changes you make don’t affect your company’s productivity.

6. Omnichannel Adaptation

You’ve probably heard of the term “omnichannel marketing” but have never bothered to find out what it means. If you want to transform your company digitally, you need to brace yourself with all the necessary skills and understand all related jargon. Omnichannel marketing refers to using digital and traditional marketing channels to engage customers with your brand. For example, sending your customer a text message about ongoing promotions as they shop, or sending your customer a reminder email if they abandon an online shopping cart.

But how is this beneficial to your business? Think about it this way; rarely do online shoppers make complete purchases at the first try. Most tend to compare and contrast with other suppliers. Therefore, introducing omnichannel marketing to your business will create a “wholesome” message and brand. It will also add a personalized touch to your business-to-consumer interactions, no matter the channels.


7. Business and IT Alignment

Digital transformation is a continuous journey that does not belong to any particular individual. To bear fruits, all company departments will need to work together toward achieving the common goal. Your business strategies will also need to align with your IT plans - one will not do without the other. If your current systems aren’t working for you, then it might be time for a change. Invest in partnerships that focus on both short-term and long-term goals.

As mentioned, providing training sessions to your employees is paramount in creating a reliable workforce. The ideal structure is ensuring that no employee becomes complacent. Nonetheless, where your company lacks expertise, it is essential to look outside and hire fresh minds or liaise with innovative business partners. In short, do not hesitate to make these necessary changes.

8. Managing and Leveraging Big Data

Data management is one of the biggest operational challenges companies are facing today. Long gone are the days when companies would unnecessarily lease offices to store large volumes of files. To successfully catapult your company to greater heights, you will need to undergo a digital transformation, meaning that your workforce will need to learn how to collect, store, and utilize data efficiently. This transformation is not to imply that your systems will not be overwhelmed with storage capacity, given that you will only have converted your hard traffic into soft traffic.

However, this is where the integration of technologies such as cloud computing, AI (Artificial Intelligence), and flow analysis come into play. Another massive bonus that comes with modern technology is that you can obtain useful information through cookies. This information can include who visited your site, when they visited, how often they visited, where they were when logged in, among other activities. With a team of IT experts, you can anonymize this data, collect it,  and immediately transform it into useful actionable insights to optimize your company’s direct sales.

Your Transformation Solution

A successful digital transformation is not easy, but neither is it impossible. Just as a caterpillar has to transform to become a beautiful butterfly, your company must evolve to keep up with the ever-changing trends. Most successful businesses didn’t get to where they are today by staying stagnant. Get in touch with a professional strategy consultant to realign your company’s goals and methodologies so that you can take on the ever-changing digital challenges of modern-day business.

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