Digital and technological advances have brought great benefits to businesses worldwide. Through digital innovation, we have experienced increased customer communication and reach, artificial intelligence, development of new solutions and systems as well as being able to collect copious amounts of valuable data through various algorithms that help drive business direction.
For a digital strategy to be successful though, you need to ensure your employees are on board with the latest regulations, legislations and disruptions. If this is an area your business struggles with, having the right infrastructure and resetting mindsets of staff will help you overcome challenges associated with digital strategy.
Risk #1: Overlooking business culture
Managing people and change in digital transformation can be more challenging than the decisions around the technology itself. Some businesses can take a top down approach, this is important particularly when you, as a business owner, need to create awareness and understanding of what the benefits of digitisation are, alongside the everyday impact of such changes.
By pushing vision from the top to create a ‘change culture’, it can support all aspects of a company’s digital transformation. Having strong and inspirational leadership in place is crucial.
Risk #2: Ignoring talent
It is important for business owners to recognise and acknowledge talent within the firm. This could include ‘millennials’ that will have the energy, inspiration and understanding of how to drive digital initiatives. By recognising and unlocking these capabilities, it helps bridge the expertise gap.
In addition to this, creating a digital eco-system by partnering with start-ups, research bodies, education institutes and business networks, for example, will also help fuel the expertise level and ignite the digitisation journey.
Risk #3: A lack of clear vision
When embracing digitisation, it’s important to have a clear and long-term vision that addresses any issues that could impact strategic planning and business goals. Issues should be assessed internally as well as externally and be viewed from a practical and cost perspective.
When assessing external factors, understanding what clients expect and what the competition is doing should be considered. Internally it’s important that staff share the same values so when rolling out your vision, everyone is on board.
Risk #4: Looking for reasons not to act
For many, the idea of implementing new technology can be daunting. Feeling this way can be down to thinking it is too complex, too costly and generally feeling unsure if it will actually benefit your business. Getting caught up in this mindset can conclude that you’re better off sticking to your traditional approach, rather than focusing on how and what elements of new technology and digitisation can work best for your business.
By incorporating the likes of artificial intelligence, blockchain or robotic process automation, which offers better business insights, it can help create the required momentum within your firm to move forward with digitisation plans. By embracing new technologies and digitisation, it will offer more training and experience to staff which will increase productivity, morale and job satisfaction.
Risk #5: Focusing on costs
Some may believe accessing and implementing new technology takes years to embed into a business and brings huge costs, which may result in negative staff attitudes. However, developments in new technology mean implementation timelines and costs have been drastically reduced.
Cloud-based technology solutions are cost effective as well as quick and easy to access, so cost and effort should no longer be a challenge.
Businesses should now be able to view digitisation as a sound investment.
Risk #6: Ignoring the value chain
Your customers and suppliers will inevitably be working on similar digitisation programmes, which could cause conflict if misalignment occurs with different platforms.
Collaborating with clients and suppliers on digital plans help to ensure that technologies adopted are a good fit for your company, as well as across the whole value chain. Closer alignment with clients and suppliers on technology plans also helps to determine which digitisation programmes to focus on initially.
Risk #7: Underestimating the opportunities
The practical aspects of addressing short term digitisation challenges often leads to long term opportunities being ignored. However, when you acknowledge the benefits digitisation can have on your business, you can clearly see how it will enhance all systems and processes.
For example, working on dashboards or combining different sources to make better sense of data can put companies more in control and help predict the success of future developments, client behaviours and result in better margins.
As we move towards a new era of digitisation, it's important to not overlook what’s possible.
By creating a culture that embraces digitisation as well as having the nature to seize opportunities that it offers, companies can achieve greater efficiencies that help them stay ahead of the competition and open up further opportunities to grow and expand.
This article was written by Remco Schoonderwoerd and Marc Engel, Partners at Mazars.