Digital transformation
9 min read
17 August 2023

8 benefits of Digital Transformation

Kelly van der Horst
digital transformation

Digital transformation is very important for businesses. Technology is advancing rapidly, changing expectations and the market. In order to keep up as a business you need to become a digital business and follow relevant trends of digital transformation. But the big question is: what are the benefits of digital transformation? And why is it important for your business to transform? In this blog we give you 8 benefits of digital transformation and explain how your business can benefit from digital transformation.

Digital transformation has many benefits, because it helps to optimise all the elements of your organisation. For example, the benefits can enhance resource management, culture, information sharing, data collection and more. When your organisation optimises each individual element, you can already notice the benefits of it, but when you improve all these elements together, that’s when you notice the real benefits of digital transformation.

The benefits of digital transformation that we’re going to explain are:

  • Faster response to changes in the market
  • Resilience to unexpected threats and changes
  • Greater competitive advantage
  • Greater capacity for innovation
  • Improved customer loyalty
  • Stronger internal collaboration
  • Smarter decision making
  • Improved profitability

1. Faster response to changes in the market

Whether it’s B2B or B2C, the way we’ve consumed, adopted and do business has accelerated.

To illustrate: in the USA in 1921, the adoption of the traditional landline was 35%. It took until 1963 to reach an adoption of 81%: that’s 42 years. It took another 39 years for it to reach its peak in 2002 with 95%. While the same increase (35% to 81%) in adoption of the smartphone happened in just 8 years, from 2011 to 2019.

And it’s not just in technology alone. This fast-paced change has rippled through to basically every sector. 63% of customers expect that companies provide new products and services than ever before. For organisations, this means that they need to be able to monitor the market, make accurate predictions and respond to changes quickly in order to keep up. Digital transformation helps to do this.

By implementing technologies to automate what can be automated and streamline processes, routine tasks are executed a lot more quickly and significant time-savings are achieved; time which can be spent elsewhere, such as on innovation, market research and the development of new products.

Furthermore, effective accumulation, organisation and monitoring of data, enables organisations to accurately predict changes before they even happen (and of course act on them). It also enables them to measure the effects of their efforts over a short period of time, to quickly adjust their products and services accordingly.

But it’s not just the technology aspect of digital transformation that allows you to respond to changes quickly. By realising a flat organisational structure where there’s more focus on autonomous teams, rather than hierarchy, decisions can be made more quickly without first having to move up and down the hierarchical ladder.

2. Resilience to unexpected threats and changes

Digital transformation does not only help you to react to changes in the market you can predict, but to those you can’t as well. This became more than apparent when COVID-19 made its global impact and brought some very big unexpected changes for almost all businesses.

The key intention of undergoing a digital transformation is to become a digital business, that’s less set in their ways and able of a more agile way of doing business. This means that a digital business is able to easily change their strategy and adapt to new ways of working, since that’s what they’ve been doing all along anyway. This does not only enable organisations to quickly respond to changes that bring opportunities, as mentioned in the paragraph before, but ensures a certain resilience to unexpected threats and changes as well.

3. Greater competitive advantage

The combination of the aforementioned ability to quickly respond to changes, threats and opportunities (and doing this better and faster than your competitors) can give you a great competitive advantage. But that’s not the only way digital transformation can enable you to stay ahead of the competition.

For one, digital transformation requires you to foster a digital culture; a culture in which information flows freely, teams collaborate and share knowledge, learning and upskilling are vital and innovation is encouraged.

A digital culture for a connected organisation

Such a culture makes it possible for everyone in the organisation to have a deeper understanding of the business, its partners, its customers, results, and so on, enabling them to do their jobs more successfully. Think for instance of the Sales department sharing frequently asked questions, and Marketing creating articles to support those potential customers during the customer journey – optimising this customer journey and making it better than your competitor’s. Doing this in all corners of your organisation can really put you ahead. Especially combined with the drive to innovate fast and create solutions and services that perfectly suit your organisation and your customers.

Insight + Action = Competitive Edge

And this does not only apply to knowledge gained through experience, but for instance through data as well. During a digital transformation, you can get the right people and systems in place to collect, organise and get insight into relevant data – data which you can use to optimise your products and services and optimise the customer journey, making you the customer’s choice over your competitor.

4. Greater capacity for innovation

Did you know that 56% of customers are looking for innovative businesses? As technology is constantly changing and the world changes with it, your organisation needs to change as well. Having more time and capacity to spend on innovation is therefore crucial, and digital transformation will help you to do so.

In the previous paragraph, we already talked about digital culture driving innovation and initiatives from employees. Besides this, a crucial part of digital transformation is to use technology to move away from manual processes, automate what can be automated, and in doing so free up time and manpower to focus on innovation and opportunities.

5. Improved customer loyalty

Optimising customer loyalty should be high on your priority list. In fact, 65% of a company’s business comes from existing customers. Luckily, digital transformation will help you do this.

How digital transformation helps you to improve customer loyalty is for a large part actually a sum of several elements we’ve already discussed: the ability to respond quickly to changes and opportunities, either by adjusting your products and services or coming up with new innovations, ensures that you are able to quickly cater to the customer’s changing needs and desires. Sharing knowledge and experiences internally enables you to optimise the customer experience, and make sure this experience is connected and consistent during every step of the customer journey. And by getting the right systems in place to efficiently collect and analyse data, you can get to know your customer in great detail, to offer them exactly what they want.

Furthermore, the use of technology enables a great level of customisation. Think for instance of personal offers and personalised follow-ups after a purchase.

Realising this level of optimisation, attention and customisation will significantly increase the chance your customer’s happiness, in its turn increasing their loyalty.

6. Stronger internal collaboration

In order to truly become a digital business, you need to create a digital culture. In this culture, there’s no room for separate silo’s, blocking information flows and disconnecting departments.

During digital transformation you need to realise a flatter organisational structure that’s based more on autonomous teams and cross-functional collaboration, rather than hierarchy. When department borders and hierarchical barriers no longer stand in the way, and systems are in place to easily collect and share information and to communicate internally, stronger collaboration is possible. After all, when people are more informed, they’re more involved. People from different departments can share ideas, work together on projects and work together on reaching your collective organisational goals.

7. Smarter decision making

Information is power. Naturally, having the right people and systems to effectively collect, monitor and organise data will make sure you are better informed, resulting into the ability to make smarter decisions based on data. The same goes for a digital culture where all departments and teams are informed on each other’s activities, goals and projects.

But an element of digital transformation you may not have thought about yet that can improve your decision making, is the easier collaboration with external parties.

You can try to keep everything in-house, but a true digital organisation knows when they need to start seeking extra knowledge and capacity elsewhere, and uses their optimised systems and processes to collaborate with these external partners. This enables them to utilise knowledge and information from around the globe, without having to research and collect everything themselves. Information and knowledge that can be used to make smarter decisions – which sounds like a smart decision all on its own.

8. Improved profitability

The last benefit of digital transformation that we’re going to talk about is improved profitability.

You can do the math yourself: during your digital transformation, you’ve improved the customer experience and increased their loyalty. Improved collaboration and more insight now enable you to optimise your products and services. You are now less caught off-guard by changes in the market, and if they do occur, you are more able to roll with the punches and adjust your business accordingly. Operations and processes are automated and streamlined, enabling people to do more work in less time, freeing up time to innovate and cater to your customer better.

As they say, time is money. And streamlining your entire organisation, from collaboration to processes, will yield you substantial time savings. And what’s more, is that all these efforts to improve your business and customer experience will make you more attractive for both customers and partners, attracting more business and increasing profitability.

What’s next?

Now that you know some of the most important business benefits of digital transformation, you’re probably wondering: what’s the next step? Digital transformation never ends and your company needs to constantly change. It requires a more flexible and innovative way of working, now and for the future.

How an adaptive workspace can support digital transformation

With the adaptive workspace, Workspace 365, you can integrate all your applications, documents, email, business processes, intranet and more in one digital workspace. This enables people to focus on their work and focus less on their IT. Are you curious how Workspace 365 can help you to support digital transformation for you organisations? Then request a demo!

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