Digital transformation is the cultural, organizational and operational change of an organization, industry or ecosystem through a smart integration of digital technologies, processes and competencies across all levels and functions in a staged and strategic way.
The many benefits of digital transformation
Digital transformation is a major concern for all business leaders now but is also a minefield of information and approaches, making strategy and implementation difficult. Digital transformation leverages technologies to create value and new services for various stakeholders (customers), innovate and acquire the capabilities to rapidly adapt to changing circumstances. 70% of companies either have a digital transformation strategy in place or are working on one. 21% of companies think they’ve already completed digital transformation.
The nature of work and society as a whole is transforming. The benefits of digital transformation to businesses across all industries need little explanation in an increasingly digital and online world – we only have to take a moment to reflect on our personal communication, consumer and leisure habits, and we’ll quickly see that digital components have become an increasingly prominent part of our lives. Executives say the top benefits of digital transformation are improved operational efficiency (40%), faster time to market (36%) and the ability to meet customer expectations (35%). 60% of companies that have undergone a digital transformation have created new business models.
So how to begin on a digital transformation? A digital transformation scoreboard is a tool for measuring your digital transformation progress against your objectives. Once you have established your current state, the next steps to take to reach the next level of digital maturity become clearer. A digital transformation will look different for every company and for each industry.
Within a company itself, it requires a cultural shift in how processes are completed. Employees have to become accustomed to experimenting regularly with their processes, and even sometimes fail in their efforts to innovate. Businesses might even find that they must sometimes step away from their old processes that they knew worked well, in favor of experimenting with innovative solutions that have not had the same extensive testing. It is only by adopting these best practices and fully integrating the employees into the mindset of digital innovation that brands can remain at the forefront of their industries and continue to serve customers with the care that they have come to expect.
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Why a digital transformation scoreboard?
- To support the knowledge base on the current digital situation in Europe and the evolution of digital transformation.
- To examine key trends in digital transformation
- What are the statistics on digital transformation?
- What are the initiatives on digital transformation?
- What are some key industrial and technological opportunities?
- What are the challenges of digital transformation?
- What are the policy initiatives related to digital transformation?
Possible objectives of digital transformation for your organization
- You are being disrupted by your competition, and you need a plan fast. You need to act now to build a strategic plan and organization-wide awareness of why digital transformation is critical to save your business.
- Your business has a plan for becoming more competitive and fending off disruption. However, you still need to on-board a new partner and go to market together.
- There is a top-level driver pushing the organization’s transformation. However, you still need to get buy in among business, product, engineering and operational leadership.
- You cannot measure progress for your digital initiatives, and you are not sure your KPIs are directly related to your desired business outcomes.
- You still have to use data and analytics to measure a regular cadence of delivery of benefits for your digital business.
- You are looking for the resources you need (including talent, leadership, and funding) for your digital transformation.
- You would like your business decisions to be made using analytics.
- You would like to drive engaging customer experiences through digital transformation.
- You would like your culture to move from project to product-based.
- You are looking for a funding model that does not hinder innovation and collaboration.
- You would like your associates, partners, and customers to get the business outcomes required through self-service.
- You would like your partner ecosystem to expand to meet business needs and support growth plans.
- You would like to monetize your company’s products and services in new digital ways.
- You would like to move your business capabilities to the cloud as part of your growth strategy.
Digital transformation scoreboard: 4 main methodological approaches
- Key indicators
Monitoring digital transformation through national data analysis from national statistics offices and international organizations. The indicators developed under the Digital Transformation Scoreboard have been updated to provide a relevant view of the current state of play of European businesses in the field of digital transformation and digital entrepreneurship.
The key indicators provide a comparative assessment of the factors supporting the development of digital transformation in the EU-28 Member States. Areas where member states need to concentrate their efforts to boost their digital transformation performance.
- Data from survey
Gathering information about the uptake of mature and emerging digital technologies by EU companies and its impact on company's performance.
- Real-time data
Examining the use of a digital intelligence platform to measure digital pulse as a digital advancement, KPI of the interest and acceptance of new technologies in EU member states. Use of open sources available on the internet.
- Policy analysis
Providing a general overview of the digital advancement of Competitiveness of Enterprises and Small and Medium-sized Enterprises (COSME) countries. Exploring and understanding all facets of digital transformation policies, desk research and interviews with representatives from European authorities.
Understanding where your organization sits on the European digital landscape
European companies are increasingly adopting digital technologies, but there are still big disparities between EU countries regarding digital transformation performance. Most European companies have adopted a 1st wave of digital technologies and 64% of companies investing in digital technologies have generated positive outcomes.
75% of respondents regard digital technologies as an opportunity. 64% of companies investing in digital technologies have generated positive outcomes, and 44% of respondents have adopted at least two of the seven key digital technologies.
European firms seem to have understood that unlimited opportunities await businesses that can transform themselves ahead of the digital curve. Digital technologies are increasingly seen as an opportunity to innovate, grow and thrive to remain competitive in the global marketplace.
The aim of the digital transformation scoreboard is to provide evidence of the extent of digital transformation in Europe. It should enable companies to understand why digital technologies are important and how they can create and reinforce their own digital strategy.
Digital transformation is progressing exponentially thanks to technological advancements influencing our everyday lives in all aspects through newly emerging economic models, business models and value chains. It brings many new opportunities to businesses, but also includes some challenges. Business leaders are still struggling to implement effective strategies to use the digital world as a source of innovation for their customers. The need for up/reskilling is recognized at all levels. Companies need to start setting up new forward-looking training programs to create the digital savvy workforce they require. Policymakers at all levels should continue to put in place bold policy initiatives aiming at establishing the right framework conditions for raising the next generation, sector-specific workforce.
Having a more profound understanding of your organization’s current digital maturity and knowing where your organization sits in the European digital landscape is essential before acting and moving your business forward.