We know you are watching leaders in the marketplace invest tens and even hundreds of millions of dollars in the digital transformation of their business. Most manufacturers or distributors are either just getting started or are now making a stronger commitment towards digital enablement. So, you know this journey will take years to evolve, but what’s the right approach to investing in digital transformation for your business?
If your organization is approaching digital transformation without a holistic digital strategy the probability of taking one step forward and two steps back is unfortunately high. The truth is that digital transformation requires investment and planning across the entire organization including technology, resources, product content, marketing technology and programs, and operations as nearly every aspect of your business will be impacted.
Digital Transformation is Evolutionary
Given that this transformation is evolutionary, not revolutionary, investing year over year with a long term perspective is appropriate. Digital leaders continue to raise their investment as the evolution takes place and the returns on their investment are realized—truly realized.
So, whether you are big or small, instead of focusing on cost containment in a fragmented departmental budget model, switch your thinking to an investment model. Ask the question what could we accomplish if we incrementally invested 1% or more of our total revenue in the digital transformation that is upon us? What could happen? For manufacturers or distributors, 1% is a lot to swallow given historical profit margins. Yet, a lack of proper funding is one of the major reasons organizations see little or no results from their digital transformation efforts.
A Key Opportunity to Invest In
The results must be metric driven and we are starting to see results from organizations that are investing at the 1% level in their transformation and gaining impressive results. Statistics now show digital leaders reporting increases in employee productivity averaging 30%, increases in average order values from 10% to 100%, lower order cost of acquisition of 28%, etc. When you do the math on those statistics, it’s easy to see that digital transformation represents one of the best business opportunities an organization could invest in today.
This transformation will be accompanied by significant change for the foreseeable future and as an organizations’ ability to not only adapt to change, but to become agile and embrace change, is one of the opportunity drivers. Secondly, this transformation must be led from the top down. Too often, organizations “assign” this responsibility to one person in the organization to define what needs to happen, how it will happen, and when it will happen. I call this person the Digital Evangelist.
So, make the switch. Invest in your future—it will be digital. Read our eBook, “Organizational Impact of Digital Transformation” to learn more about how the power of investing for digital transformation can positively impact your organization.