Digital transformation is impacting the world today at unprecedented rates. It took only four years from the launch of Netflix’ digital business model to send Blockbuster towards bankruptcy. Digital business models are revolutionizing markets, and companies that take advantage of the customer-focused opportunities this digital shift provides will see major benefits to their organization. For example, companies that prioritize customer experience generate a total cumulative return nearly three times greater than organizations that don’t. Digital maturity is critical to enabling these new customer-driven business models to succeed.
The problem: Fragmented digital efforts
However, many companies have begun their digital transformation journey with isolated efforts and projects—such as a mobile front-end, social campaigns or procurement strategies. This approach has created silos of information and processes and, unfortunately, these will continue to occur. Fragmentation not only increases operational complexity, but it also creates an inconsistent customer experience. And when your customer is the main driver of so many business initiatives, it’s imperative to deliver a positive and consistent customer interaction.
Digital transformation is raising the pressure on business owners to work closely with individual business units and empower teams to manage an effective digital-first program. But at best, digital fragmentation threatens to slow down the journey toward digital maturity. At worst, it could jeopardize a company’s position in the market. In fact, it’s estimated that about half of S&P 500 companies will be replaced over the next ten years.
A new approach
Companies need to move away from isolated digital efforts and embrace digitizing the company as a core business strategy. Building a truly robust digital platform tailored to your current and future business structure will enable you to unlock the power of your information, become more intelligent and connected, and drive engagement with customers, partners and employees.
According to Gartner, by 2024 artificial intelligence (AI) will become part of every software, service and physical asset and drive new levels of automation across the enterprise. Research indicates that the IoT market will be worth $520 billion in 2023, more than double the value from 2017.
The role of a CFO is crucial in the journey to digital transformation. McKinsey notes that without the CFO’s engagement in digital transformation, organizations often lack of a clear financial baseline to gauge success, place focus on high-visibility projects over higher-value projects and don’t see the benefits of digital transformation reflected in their bottom line. In my next blog, I’ll go into more detail on the role of the CFO in digital transformation—stay tuned for more.
To compete in these new market conditions, organizations need to transform their business practices and adopt new technologies. OpenText™ is uniquely positioned to help your organization become an intelligent and connected enterprise.
Join us at OpenText™ Enterprise World 2019 to hear how we’re enabling the Intelligent and Connected Enterprise with AI and the Internet of Things.