If you’re among those
business executives who are taking the prospect of digital disruption
seriously, you’re already ahead of the curve. Studies show that across all
sectors, four in 10
of the top firms in an industry will be displaced by digital disruption within
the next half-decade. Perhaps even more surprising is the fact that surveys
also show that as many as 45 percent of companies across all industries do not
consider the impending effects of digital disruption as a matter deserving of
executive-level attention. Of the Fortune 100 companies listed in 1975, only
25% of them are currently on the list today. Those that do not adapt and change
will be disrupted.
If you have yet to factor
digital disruption into the future of your business, it’s not too late to
begin. Companies should always consider specific organizational factors like
strategy, company culture, technological IQ, and overall readiness when
choosing the right way to approach digitization. However, the following three models
provide a framework and guidelines to take operations digital.
Choose a partner to jumpstart digitization.
Large companies whose
operations are deeply rooted in traditional business models may find it easier
to outsource digital practices in the beginning. Companies that were “born”
digital, or those that have invested significant resources into developing a
digital platform, may have a modern service that your business could
strategically use to bring its own operations into the future. For example, a
company without a strong ability to reach customers online may partner with a
social media company to advertise their products or services until they can establish
a digital presence on their own.
Some companies see long-term
digital partnerships with outside entities as an option that increases their
relevance and profitability in the marketplace without a complete overhaul of
their business model. In these instances, both companies avoid the complicated,
drawn-out process of acquisitions and formal joint ventures while still
combining resources to reach the greatest possible number of consumers.
Shift your primary organizational focus to going
One of the most common
issues that companies encounter when attempting to go digital is department
leaders who do not understand why digitization is receiving priority over other
operational aspects. Prioritizing digital transformation can be especially difficult
for long-established companies that have operated under a traditional business
model for decades. Certain company leaders suddenly find themselves having to
focus on a process they don’t completely understand.
Still, making digitization
your main goal is an effective way to help your business succeed in the digital
age. As CEO, this approach requires you to redistribute the budget and
departmental headcounts in order to provide more support for digital programs.
Some executives even hire CDOs (chief digital officers) in order to oversee the
Leaders who opt for this
approach can’t forget to maintain strong lines of communication with department
leaders throughout the duration of the transformative process. Making sure all
leaders understand the value of digitization will help mitigate animosity and
ward off potential internal conflict.
Digitize from the outside-in.
For certain businesses,
internal processes cannot be transformed through a digitization without
completely shutting down operations temporarily. In these instances, companies
should consider reversing the order of the typical technological integration
By separating analog
operations from their digital counterparts, a company may designate a subset of
employees to work on digitizing operational processes without interrupting the
company’s daily functions. Once the digital platforms are in place, the
traditional processes can be migrated over and integrated seamlessly so that
productivity remains relatively constant .
This method can be
extremely effective, but it must be done with care. Companies that undertake
this approach to digital transformation must carefully consider the order in
which processes are integrated and closely monitor the effects of each process
as it is phased in. Being smart about the order in which processes are
integrated will help avoid chaos during the transformation.