Digital transformation strategies for modern businesses

Digital transformation for businesses goes beyond having a website and social media accounts. It’s about embracing different forms of technology to make your business more efficient, better meet your customer’s needs, and achieve your business goals.

Recent history has shown that businesses which are slow to adopt digital strategies are at significant risk of obsolescence, while those that proactively plan the transformation are poised to make massive gains when tides inevitably shift. For example, take the stark differences in outcomes for two businesses—Sears, who failed to innovate on their famous “Sears catalogue” in a post-digital world resulting in bankruptcy, and Netflix, who transformed their DVD-rental service into the world’s leading online streaming service (more on this below).

In this article, we explore what it means to create a digital transformation strategy for modern businesses and how upskilling your teams should be a part of this strategy.

Understanding digital transformation

A digital transformation strategy defines how an organization adopts digital tools, resources, and platforms to achieve business objectives. This plan outlines how a company will use digital tools to better meet their needs and their customers' evolving needs.

Your digital transformation will likely include components of:

• Web - What does your company’s online presence look like on your website, social media, digital tools, and apps?

• Data - How will your team collect and use data (customer information, engagement, transaction history, industry trends…etc) to create better offerings, processes, and outcomes?

• Cyber security - How will your company use software, hardware and information technology to meet its business objectives?

The strategy also contains a risk assessment so you have a blueprint for using digital technology to address potential risks such as:

• Another pandemic (where people don’t shop in person anymore)

• Aging customers’ needs changing

• Hacking or cyber attacks

• Protecting sensitive information (internal and customer information)

• Needing to upskill or reskill staff on emerging digital technologies

Other work-force related benefits include:

• Succession planning

• Enhanced productivity and efficiency

• Improved retention

Businesses who plan for risks like these can pivot parts or the whole of their business model to stay relevant in times of change.

Nextflix’s digital transformation

Netflix is an example of how a company adopted a successful digital transformation strategy to meet the needs of its customers. When Netflix first launched, they were a mail-in DVD rental service. As their customer’s needs evolved, they adopted a digital transformation strategy that evolved into a video streaming service. This change saved them money and the logistical hassles of shipping while better catering to their target customers who were already digitally savvy.

This Netflix transformation helped them become one of the first major players in the streaming movie market, rather than going bust like competitor Blockbuster. A great digital transformation strategy can help you stay ahead of your competitors and be ready to adapt and capitalize when the market or your business needs it.

Examples of digital technologies

Digital technology encompasses a wide range of services and technologies. Here are a few examples of digital technologies your company might include in a digital transformation strategy:

• Web-based apps

• Cloud-based computing services

• Mobile apps

• The Internet of Things

• Robotics

• AI tools

6 steps to assess your digital readiness

Leaping head first into a digital transformation strategy isn’t usually recommended. Before you can begin an effective transformation, you must identify your digital readiness and ensure it aligns with your company values and goals, as well as your target customer's needs.

Here are seven steps to evaluate your digital readiness and create your digital transformation strategy:

Step 1: Identify your goals and objectives

Why does your company want to create a digital transformation? Start by outlining the goals you want your business strategy to achieve. There are many goal-setting frameworks you can use, two popular ones being S.M.A.R.T. goals and O.K.R.s, which can be used for businesses cases including:

• Increasing company revenue

• Attracting more subscribers

• Optimizing internal business processes and systems

• Increasing employee morale and retention

• Supporting employee's professional development

• Evolving offerings with customer needs

• Expanding into new geographic markets

For all the above goals, be sure that they are actionable, measurable, and time-bound so you can track progress. For example, instead of a goal being “expand into new geographic markets”, choose “expand into two new geographic markets by the end of Q2.”

Step 2: Evaluate technology maturity

Your digital transformation strategy will likely include onboarding new systems and software, but look at your current technology infrastructure before you make these changes. Are you already paying for digital tools without using their full feature set? Are there any mainstream solutions that could help you meet your goals? Or are there any emerging tech or solutions you want to invest in?

Don’t forget to look at your employees' digital capabilities too. If you were to implement a brand new CRM system, would that hinder your staff from performing their jobs while they learn the new system? Consider how you could make new tech onboarding easier for your IT teams and the staff that use them.

Step 3: Evaluate available resources

A successful digital transformation strategy should include all the necessary tools and resources, and consider the scalability of each one. Consider what resources you have to implement and maintain web technologies, data collection and use, and cyber security. In addition, successful plans factor in:

• Talent (employees, contractors, third-party consultants)

• Technology (personal computers, point of sale terminals, inventory management tools, online software)

• Data (customer profiles and preferences, marketing analytics, third-party databases)

• Time (to ensure goals are achievable within company and employee time constraints)

Step 4: Create your budget

A digital transformation could save your company money in the long run, but there are upfront and ongoing costs to consider. This may include purchasing software, customizing systems for your business, and maintenance and security features.

If budget is a concern, remember that your business strategy can be rolled out in phases. Prioritize the transformations that are either easiest (or cheapest) to do or most positively impact your business goals.

Step 5: Create a digital transformation roadmap

Your roadmap is your plan for executing your company’s digital transformation. It’s your plan to use digital tools and strategies to reach your goals (as you defined in step 1). Start small by implementing a strategy for a small group of staff or implementing smaller changes across the whole company. Then, you can scale and add to your plan based on your roadmap and timeline.

Your digital transformation roadmap may include:

• Assigning digital transformation leaders (like project managers and team representatives)

• Identifying which technology to implement

• An analysis of current data available and future data needs (and where that data will come from).

• Supporting projects for onboarding new technology (such as a website redesign or e-commerce platform migration)

• Risk assessments and mitigation strategies for each

• Internal and external communications and onboarding plans for employees and customers

• Upskilling and reskilling needs for employees

• Budget to create or update marketing and sales material if needed

Step 6: Rollout and adjust your transformation

Once you have your champions on board and your strategy completed, you can begin working through your roadmap. Check in with necessary stakeholders regularly to ensure the transformations are meeting their needs. If not, bring your main project team back together to make revisions as necessary.

Remember, as new technologies emerge and your customers change, your digital needs grow with them. Your digital transformation strategy should be an ongoing, iterative process that will never be completed. Yes, you may complete pieces of your strategy (such as implementing new helpdesk software or digital inventory system), but they will require maintenance and scaling as your business grows and technology advances.

Upskilling and reskilling your workforce

Your employees are a key driver of your digital transformation efforts (and they should be excited about it!). Without a skilled team ready, eager, and able to help, your digital transformation strategy won’t achieve your business outcomes and goals or adoption might be slower. This may require upskilling and reskilling your workforce.

Lighthouse Labs has off-the-shelf and bespoke upskilling and reskilling programs to help your staff through your digital transition. Here are a few examples:

• Data Science Programs: Take foundational, intermediate, and advanced courses for business and data analysts, data engineers, and specialized business and functional teams like human resources and sales.

• Web Development Programs: Enroll in all-level courses for developers and engineers, specialized to your company’s coding languages, tech stack, and unique needs.

• Cyber Security Programs: Expand and enhance your team’s capabilities with up-to-date skills in incident handling, malware analysis, secure design principles, and more.

By providing programs like these to your current staff, you empower them to advance their personal career trajectory, and they become champions of your digital transformation strategy.

👉Learn more about Corporate Training programs at Lighthouse Labs.

Best practices for implementing upskill and reskill programs.

Before implementing your upskilling or reskilling programs:

• Perform a gap analysis to see where skill gaps exist. Which skills and competencies are already prevalent throughout the org and which are not?

• Identify employees ready for upskilling or reskilling. Who has expressed interest in the past? Who is eager to learn?

• Personalize the process with a custom-designed course for your team. Leverage existing data or user cases within the organization. What are some specific pain points this digital transformation will help to mitigate?

• Ensure employees understand why they're participating in the training and what it could mean for future promotions within the organization. Make it clear that the value this initiative will drive could extend beyond company goals and onto their own resumes, perhaps.

Getting clear on what skills need to be taught and to whom is one of the most crucial pieces of a digital transformation strategy. Schedule a meeting with a Lighthouse Labs corporate training representative to learn more about how we can support your digital transformation planning.

Overcoming common digital transformation challenges

When trying to kick off digital initiatives in your organization, you may meet those who oppose them. Without your entire team on board, the success of a digital transformation may be limited.

Here are common challenges you may face while trying to implement your digital transformation initiative:

Resistance to change

Some stakeholders may be resistant to change. In addition to clear, concise communication about the transformation proposed, your company leaders must be on board. Their influence and leadership can help those on their teams buy in, and that’s where the transformation will be the strongest. So many efficiencies can be realized in the process when frontline employees help drive your digital transformation. This skyrockets your chances of success to 71%.

Budget constraints

A common challenge businesses face in their digital transformation strategy is budget. It’s not uncommon for digital transformation projects to be expensive, especially if you need to purchase and customize new software or platforms.

The solution is to prioritize. Choose ones that:

• Are inexpensive but can impact significant results

• Directly impact your business objectives

• You have the resources to complete now

• You can temporarily divert funds from other projects to cover, if necessary

You can also attempt a break-even analysis to help you understand the short-term and long-term measurements of success.

Your digital transformation roadmap can be a phased project. It doesn’t have to be something to rush into, complete in a few months, then never look at again. Level set and be realistic in your deadlines—especially if there is resistance to change within your organization.

“We don’t need it.”

Another common roadblock is you get internal stakeholders who say that you don’t need it. Their apprehension may be due to many factors, and you need to identify what’s driving their concern or point of view and address it:

• “Our staff are already overworked!” - Consider adding temporary staff for support during the project.

• “The technology is too hard!” - Consider upskilling or reskilling training to ensure staff are comfortable with new technologies.

• “Business is good. Why rock the boat?” - Present the benefits of staying agile in the face of business uncertainty (pandemics, spending habit changes, customer needs evolving, supply chain pricing increases...etc.).

It may take some great communication to get an opposed party on board. When your company’s leadership team can communicate a compelling, high-level change story, the transformation is 5.8x more likely to be successful.

How a global automotive company overcame digital transformation challenges

Company X (anonymized) is one of the largest car manufacturers in the world. They wanted to optimize their data maturity as part of their digital transformation strategy and needed an integrated and optimized approach for scalability and better decision-making.

Lighthouse Labs strategized a bottom-up approach with them by offering foundational data skills courses to their business units, empowering them to contribute to strategic decisions on customer experience, inventory management, resource, and headcount planning, among others.

The custom introductory learning courses were, and continue to be, very popular and have been complemented with an increased and intentional use of PowerBI dashboards within the organization. Lighthouse Labs has since run a suite of data courses for the automotive giant, which have subsequently not only advanced the data maturity and skills across the organization but have helped foster employee satisfaction and retention. This bottom-up approach, supplemented with a top-down focus on digital transformation also prompted the need for a leadership course to address data governance, ethics, and processes to ensure data was used to its fullest potential across the company. Today, data analytics is considered a core skill set for employees at the organization.

👉Data analytics is just one way to transform an organization. Learn how human-centric cyber security training can impact your business.

Embracing new technology with upskilling and reskilling

Digital transformation strategies shouldn’t be about just adopting the latest and “coolest” new technology. A strategic, long-term approach catered to your unique business model is the key to scalable and profitable business success. Supported by the hard and soft skills of your staff, your digital transformation strategy has a foundation for success.

By incorporating digital technologies into your business, you are future-proofing your company against changes in the market and your business direction. You’re creating opportunities for your employees to grow with the company. You’re also attracting customers and clients with services and products that they need.

How will you embrace digital technology in your business processes? Give your strategy a success boost by ensuring your team has the skills and knowledge to help you execute it. Lighthouse Labs’ corporate training programs are customized to your digital transformation plan. We’ll bring our instructors to you!

Our programs can be customized to the needs of your staff, whether they’re a newbie or professional developer. Our courses are 75% hands-on, so you can practice what you learn with your instructors there to advise and critique.

Discover how our Corporate Training programs can drive your digital transformation.