Types of Digital Transformation
Types of Digital Transformation
Jun 22, 2022

Types of Digital Transformation

Digital transformation is complex to describe because it takes on diverse forms in different industries. However, in broad terms, it is defined as the integration of digital technology into all aspects of business. As a result, there has been a significant shift in how firms operate and engage with their customers. It's a complete rethinking of how a company uses technology in conjunction with processes and people to improve its bottom line.

In an ideal world, a company's digital transformation is directed by the CEO, in collaboration with the CIOs, CHROs, and other senior executives. To effectively connect quick application development methods with business-focused philosophies, digital transformation necessitates enormous cross-departmental cooperation inside an organization.

A company's ambition to develop new business models and revenue streams, or significant changes in customer expectations for products and services, are usually the catalysts for a digital transformation.

Types of Digital Transformation

Digital transformation isn't a single big thing. Often, businesses are just focused on organizational change, ignoring the fact that there are four different types of digital transformations. As a result, they're missing out on all of the benefits that digital transformation has to offer.

Process Transformation

Much of the focus inside the corporate environment has been on innovative ways to reinvent business processes to save costs, enhance quality, or shorten cycle times, using data, analytics, APIs, and machine learning, among other technologies. Companies like Domino's Pizza, where customers may now order from any device, are examples of successful process transformation. They've completely overhauled the ordering process. This innovation has allowed them to surpass Pizza Hut in terms of sales.

Domain Transformation

Amazon, the online mega-retailer, is a good example of how domain transformation works. With the debut of Amazon Web Services (AWS), it entered a new market sector and is now the leading cloud computing/infrastructure service in a field previously dominated by IBM and Microsoft. AWS is a great illustration of how new technologies are redefining products and services, blurring industry lines and introducing totally new types of rivals. One of the most important chances for firm success right now is domain transformation.

Business Model Transformation

Process transformation focuses on certain business sectors. The underlying building blocks of how value is delivered in a certain industry are the focus of business model modifications. In essence, businesses are transforming their business models through digital transformation. Netflix's redesign of video distribution and Apple's reinvention of music delivery: iTunes are two examples of this type of business model innovation.

Organizational/ Cultural Transformation

To achieve long-term digital transformation in any industry, a rethinking of organizational mindsets, procedures, personnel, and capabilities for the digital age is always required. Digital transformation involves a flexible workflow, a decentralized decision-making process, a leaning toward testing and learning, and a higher reliance on various business ecosystems, according to the most successful organizations.

Experian, a consumer credit agency, is one of the best examples of this cultural/organizational shift. By incorporating collaboration and agile development into its workflows, it was able to transform its company. It also sparked a fundamental change in employee concentration from equipment to data across the organization.


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