Why the term ‘digital transformation’ will soon be irrelevant

A watershed moment: how COVID-19 compressed the roadmaps

In 2018, a survey showed 89% of organisations had plans to adopt a digital-first business strategy.^[2] This year, COVID-19 stress-tested who had, and who hadn’t, made progress in implementing those plans.

For the past few decades, technology has been rapidly advancing, shifting customer expectations and accelerating the pace of market change. The need to harness new technologies has, therefore, long been a pressing issue, with companies looking to increase operational efficiency, transform existing business processes, and deliver a more digital employee and customer experience.

COVID-19 then plunged the world into a digital-first age, with many of us switching to an all-virtual way of working, socialising, and shopping. Even the age-old practice of worship has gone digital, providing online prayers and services.

In the business setting, this has been a watershed moment for digital transformation. 97 per cent of business decision-makers say that the pandemic has sped up digital transformation at their company. Specifically, survey findings indicate COVID-19 has shortened the timeline for digital communications strategies by around six years; companies in the construction and energy industry have seen the largest leap forward, with digital transformation timetables accelerated forward, on average, between seven and eight years. ¹

In a landscape where so much is still uncertain, one aspect of the future can be guaranteed: leaders who revolutionise their business model and enter a core state of constant digital transformation (improving products, services, processes and ways of working) will succeed. Leaders who attempt to stand still and wait out the ‘digital-first storm’ will perish. Customer expectations will keep evolving as new ideas and technology advances; this is a certainty. The only way forward is into the digital age and companies need to transform and keep transforming to stay relevant.

What digital transformation is (and isn’t!)

Despite the topic of digital transformation being a major topic over the past few years, its definition is remarkably elusive. One team of researchers found 28 academic papers offering 23 unique definitions, before ultimately offering their definition as “a process that aims to improve an entity by triggering significant changes to its properties through combinations of information, computing, communication, and connectivity technologies”. ^[3]

At Lane4, we prefer to go with the less wordy definition offered by MIT principal research scientist, George Westerman:

“Digital transformation marks a radical rethinking of how an organization uses technology, people and processes to fundamentally change business performance”

Alongside a clear definition of what digital transformation is, it’s also important leaders understand what it isn’t, namely:

• It’s not just about adding in new technology. Whilst in the last decade digital transformation often referred to a change in IT system, with decisions focused around what to migrate, where and when. There is increasing awareness that digital transformation goes way beyond technology, requiring a fundamentally different operating model and way of achieving performance.
• It’s not something that can be completed. Companies will make progress on their digital transformation journey, but, be under no illusions: this is not a one-off transformation to complete. Transforming to a digital age is a continual never-ending process of innovation. As technology continues to rapidly advance, customer expectations will continue to change, and businesses must continue to transform.