Digital transformation. What is it and how does it help companies?

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Digital transformation. What is it and how does it help companies?

Digital transformation has become a buzzword in the business world. Influencers describe the benefits and how organizations that are not digitally transforming will be left behind and overtaken by the competition. But what exactly is digital transformation?

Digital transformation is the integration of digital technology in all areas of a company, fundamentally changing the way it operates and delivers value to customers. It is also a cultural shift that requires organizations to continually challenge the status quo, experiment, and be comfortable with failure.

Essentially, modern digital tools are used to find more efficient and data-driven ways of doing things at all levels of the business to positively impact operations and service delivery. This can extend to multiple areas of an organization or simply involve modernizing one aspect that is so critical that it completely transforms the business.

Advantages of Digital Transformation

1. Elimination of time-consuming manual processes

One of the main benefits of digital transformation is the elimination of tasks that unnecessarily waste staff time. By implementing digital technology, software can be used to perform tasks previously performed manually by staff.

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Digital transformation helps optimize business processes and efficiency

2. Improved customer experience

Automating tasks also improves customer and staff experiences as they will see much faster response times when they have an inquiry. One of the benefits of digital transformation is allowing customers to access services and support through their preferred method of interaction.

By leveraging digital tools, you can enable omnichannel support, which allows customers to communicate by phone, website live chat, email, mobile app, or through a support forum. By keeping everything digital, companies can provide multiple touch points, track interactions, and make it easy to track and collect customer feedback.

Similarly, organizations can use digital tools and processes to make it easier for customers to access their services through e-commerce, mobile platforms, social media, and other digital avenues. Not only do customers get the benefit of accessing services through their preferred channel, but companies can also suggest other related offers, products or services using the data attached to their accounts.

These are processes that can be built and refined once a company manages these aspects through digital technology and can be refined based on actual customer experience.

3. Greater flexibility and scalability

One of the main benefits of digital transformation is breaking free from restrictive legacy systems and taking advantage of modern and scalable alternatives. Existing processes in companies are often based on old technology that requires manual input, creating bottlenecks when workloads increase. Some manual processes just won’t scale as more and more employees need to process orders, service requests, provide support, or complete other business functions.

Modern software and processes are often easier to integrate, so you can connect multiple parts of your business instead of “separating” data by department or function. When a task is completed, modern systems can often connect the data or the next item to get it where it needs to go, without manual intervention.

Transforming companies to operate digitally also allows those organizations to remain agile and better respond to innovations and trends in their market.

4. Improved reliability and reduced risk

As organizations continue to grow, the technology and processes they have relied on over their years can begin to fail them.

From a technical point of view, it can be more difficult to back up, maintain, and protect data within older systems. This can make them more prone to failure or an easier target for cybercriminals.

5. Efficient decision making through real-time data

Software-centric digital processes open a level of visibility into what is working well and what can be improved. Since all data is stored digitally, often in real time, it is much easier to recognize patterns and identify opportunities for improvement.

Central data repositories can be mined to gain insight into where there are bottlenecks in workflows, which issues resurface the most, employee performance, customer preferences and behavior, and many other areas. Once a business uses digital tools and develops processes around it, it is much easier to produce reports and pinpoint areas for improvement compared to traditional surveys, sampling, and manual feedback gathering.

Companies also drive efficiency in their supply chain by integrating digital tools at each stage of development for the delivery of services or products. This can be as simple as tweaking existing processes to include a digital checkpoint, or as advanced as automating processes and monitoring output at each stage through IoT devices.

More data generally leads to faster and more accurate decision making.

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Data is vital in the digital transformation processes in companies

Examples of Digital Transformation

Below, you can see some examples to understand the impact that the restructuring of processes around digital technology can have.

These are just a few examples to demonstrate the broad effect that digital technologies working together can have on different types of businesses. Of course, not all organizations will be able to take advantage of digital tools in the same way, but there is a typical pattern of benefits that companies can realize by using digital technology to renew processes and provide more value to customers and staff.

Digital Transformation in Financial Services

The typical example of the traditional bank that happens to offer its services online. You can offer reduced cost for clients in multiple areas with self-service banking, mortgage applications, self-directed investment options while freeing up time for your financial advisers to meet and advise people instead of completing paperwork, processing, applying and other tasks that can be automatic or self-directed.

Digital Transformation in Manufacturing

Digital transformation in manufacturing can include integrating sensors and IoT devices for real-time tracking of manufacturing, automating manual processes such as inventory control and replenishment, and using data analytics to identify inefficiencies. in the supply chain for further improvements.

Digital Transformation in Agriculture

Agricultural companies are taking advantage of all kinds of new digital tools to improve their production and improve processes. This includes precision agriculture technology that can revolutionize the way crops, IoT and sensors are monitored in the fields, drones, and advanced robotics to improve productivity and reduce the time required for spraying and other tasks.

Digital Transformation in non-profit

Digital technology can make it easier for members to renew, provide a more intuitive platform to launch fundraising campaigns, notify donors when their donation is being used in some cases, and a host of other benefits. It can provide great ongoing organizational benefit to non-profit that often have tight annual operating budgets.

Digital Transformation in Insurance Companies

Insurance companies often run manual processes to submit, evaluate, and approve claims. These organizations can take advantage of modern technology to optimize processes and offer better customer service. They can do this through self-service portals for part tracking and support, enable customers to submit parts via mobile apps, automated approvals and verifications, and integrate with other systems. It’s essentially about analyzing where there are manual touchpoints in current workflows and seeing what can be automated or digitized to reduce the work required and process claims faster.

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Digital transformation can improve various areas of the company in all sectors


Now, while the listed benefits of digital transformation (automating repeatable tasks, increasing customer experience / satisfaction, driving efficiency, flexibility, reducing risk) are all that most companies want to achieve, it is important to have consider your business and your specific goals.

  • What do you want to achieve through digital technology that you cannot do today?
  • What problem areas are you looking to fix?
  • What value do you want to provide to your customers that your current processes and technology do not allow?

Approach your digital transformation journey strategically with your end goals in mind. Then chart your course to reach the goal.

Alex Romero – Digital Marketing Expert
Marketing Digital Malaga