Computer technology has been around for a while, and the idea of digital transformation is fairly recent, the adoption of the Internet, as well as advanced technologies like artificial intelligence(AI), cloud computing, and the Internet of Things(IoT), have played an important role in speeding up this transformation, where digitization has become required in various aspects of our lives, influencing how we work, shop, travel, learn, govern, and live.
Let me explain why it's so important.
To show just how important Digital Transformation is, here are some notable statistics:
- The digital transformation market is worth $880.28 billion.
- Global spending on digital transformation is expected to hit $3.4 trillion by 2026.
- 74% of organizations consider digital transformation a top priority.
- 97% of companies say the COVID-19 pandemic sped up their digital transformation initiatives.
- 77% of companies have already started their digital transformation journey.
- Only 35% of organizations’ digital transformation efforts are successful.
World Economic Forum in 2016 even stated that “The combined value – to society and industry – of digital transformation across industries could be greater than $100 trillion over the next 10 years” While this is far from where we are, the prediction was many years ago. Fortune Business Insights says the Digital Transformation Market was valued at USD 1.91 trillion in 2022, The global digital transformation market is projected to reach USD 8.92 trillion by 2030.
Firstly, digital transformation is all about using technology to make significant changes in how a company works. It's not just about getting new gimmicks or tools, it is about fundamentally changing how things are accomplished. For example, when a company switches from paper-based processes to digital ones, it's undergoing digital transformation.
One reason why digital transformation matters is because it helps businesses become more efficient. When processes are digitized, tasks that used to take a long time can now be completed much faster. For instance, we can use software that automatically updates information in real time instead of manually putting data into spreadsheets. This saves time and allows us to focus on more necessary assignments.
Digital transformation increases business agility. What does that mean? Well, it means that companies can adapt and respond to changes in the market more quickly. For instance, if a competitor launches a new product, a digitally transformed company can quickly adjust its strategies and offerings to stay competitive. This skillfulness is crucial in today's business environment.
Another crucial factor of digital transformation is its impact on customer experience. Companies can provide more personalized experiences to their customers. For example, using customer relationship management (CRM) software, we can track customer interactions and preferences, allowing us to oversee our products and services to meet their needs better. This doesn’t only improve customer satisfaction but also promotes customer loyalty.
Similarly, digital transformation opens new value for all stakeholders that are involved. For employees, it means having access to better tools and resources that make their jobs easier. For customers, it means having access to innovative products and services that handle their needs. And for shareholders, it means increased profitability and competitiveness in the market.
Some specific benefits of digital transformation:
- Improve efficiency: By automating manual processes and facilitating workflows, digital transformation allows us to accomplish more in less time. This frees up resources that can be assigned to other strategic parts of the process.
- Improve decision-making: With access to real-time data and analytics, we can make more informed decisions that drive business growth and innovation. This will enable us to stay ahead of the competition and grab new opportunities as they arise.
In conclusion, digital transformation is not just a buzzword, it's a critical strategy for businesses looking to succeed. By embracing this shift, companies can generate new value for everyone involved, driving innovation. With the digital transformation market projected to reach USD 8.92 trillion by 2030, it's clear that this evolution is crucial for businesses to flourish in the digital era.