Digital Transformation: Its Impact on Business Landscape
Digital transformation is the process of embedding technologies into all aspects of business, from daily operations, and accounting to strategic decision-making. It is not only about converting analog to digital technologies but also about a culture shift and rethinking of ways an organization should work. Digital transformation helps to grow the business in no time as it supports going global in seconds. Business is all about understanding the customer’s needs and problems and providing a better solution at the best price, fully supported by digital transformation. In addition, it assists to systematize and evaluate daily operations and ultimately make effective strategic decisions.
The key benefits of digital transformation are listed below:
1. Reduces costs and saves time in processes.
2. Opens the door to new business opportunities and revenue streams for the organization.
3. Increases the speed of response to changes as per the demand of the market or adapts to the market.
4. Generates a competitive environment that results in the improvement of the quality of goods or services.
5. Enhances integration and internal collaboration by facilitating communication between departments which results in smooth day-to-day operation.
6. Increases the level of decision-making with the help of data analysis i.e. Big Data.
According to the latest Harvard Business Review study, about US$1.3 trillion was invested in digital transformation in 2018. However, a lot of spending ends up being wasted as the organizations are not prepared for change i.e. digital transformation. Experience and skills related to digital transformation are necessary for the strategic plan of almost all organizations. In a 2021 survey, about 55% of organizations in Europe stated the COVID-19 pandemic has increased the demand for digital transformation, and 46% of organizations reported that they have grown more toward digital. The COVID-19 pandemic forced businesses to implement digital technology in their business as well as day-to-day activities. During the pandemic, 53% of enterprises in the European Union that had implemented advanced digital technology previously have invested more to become more digital. This is compared to 34% of non-digital EU organizations that viewed the crisis as a chance to begin investing in their digital transformation. Organizations that adopted digital technology were better prepared to deal with the pandemic’s disruptions. Smart factories, remote working arrangements, 3-D printing to produce in-house product components or parts affected by supply chain disruptions, and the use of big data analytics and artificial intelligence to schedule, reschedule and plan activities are a few adaptation strategies used by organizations.
In the context of Nepal, The digital transformation of Nepal has started to make an impact on the nation. Almost 70 percent have access to the internet. Digital capabilities are enhanced, and technology is poised to quickly improve nearly every sector of Nepal’s economy when the connectivity becomes more omnipresent. Digital transformation has started to make positive changes in communication practices. Quick internal communication among personnel and personalized external communication have made the business sector even more effective. Huge internet service is being used for digital communication, online marketing, and e-commerce. Due to the huge influence of the latest technology i.e. mobile applications, e-commerce has been the trend. User-friendly online shopping avenues like Daraz and easy digital payment platforms like eSewa, and Khalti have paced up the trend. Talking about history, the technological revolution has been ignored due to poor leadership vision in development activities. Different hurdles and disputes in long-term policy planning and management have been our true problem. Lack of understanding of the needs and cope up with the technology, lack of strong database, inefficient markets, and poor service delivery are responsible for the slow transformation. Corruption, Nepotism, or Unprofessionalism at the government and local level is equally a barrier.
The two foundations of digital transformation are innovation and disruption. Organizations must be focused on changing the landscape of their business and be sure to count on the right talent to carry out the business model, as well as train and retain existing talent. Disruptive forces abound in today’s business environment. For these reasons, retaining the impact of such a transformation requires a major restoration of mentality and behavior. The digital transformation adds power to the business and with great power comes great responsibility. The power here is the customer data, which if reached in the wrong hands may exploit the emotions of the market. So, any business wanting to enjoy the boon of digital transformation must accept the data security responsibility and work accordingly.