Guide To Digital Transformation For Small Businesses

Contrary to popular belief, Digital Transformation is not just limited to building software, a website, or a mobile app. Many people think that the job of Digitalization is complete when they build decent software, a website, or a mobile app. Digital Transformation is the process of taking a completely new approach regarding a traditional offline business.

In Digital Transformation, we are concerned with the integration of digital technology in all the major areas of a business. The idea is to align the business with the needs of the digital customer so that the business can deliver value to the customer in the most efficient manner.

Digital Transformation is more of a cultural change that challenges the traditional status quo of doing business.

Why do Small Businesses Need to Invest in Digital Transformation 

Now the question arises why, as a small business owner, you should opt for Digital Transformation. Let’s have a look at some of the top reasons that will help you to make the decision to transform your business to digital.

Increase efficiency

Businesses leveraging digital tools and platforms will avail of real-time data access, analysis, and decision-making, leading to faster and more informed actions. Besides, routine tasks and processes’ automation enhances operations, reducing manual errors and enhancing productivity. Also, employees are engaged in productive tasks rather than tedious, repetitive tasks, which improves employees’ efficiency and, thus, productivity.

Becoming scalable and flexible

Small businesses must quickly adapt to changing business requirements and dynamics to sustain and thrive. That’s where cloud-based solutions offer scalability to small businesses to accommodate growing data and user demands.

Save money

Digital technologies can reduce the environmental impact by optimizing resource usage and reducing paper waste, saving money. Plus, streamlining processes and automating tasks can lead to significant cost savings. Cloud computing and SaaS (Software as a Service) models often reduce IT infrastructure and maintenance costs. It makes digital transformation a cost-effective option as opposed to traditional models.

Take collaboration and communication to the next level

Most Cloud-based platforms enable real-time sharing of documents and data with video conferencing or project management solutions. Digital tools facilitate collaboration among teams and partners, regardless of geographical location.

Enhanced customer experiences

Customers are important assets for businesses that they cannot afford to lose. Customers look for services that are easily accessible and with great convenience; that’s where multichannel communication options help. Digital transformation allows small businesses to personalize customer interactions, providing tailored services, recommendations, and support.

What are the four main areas of digital transformation?

Digital transformation typically encompasses “four pillars” that represent the core aspects of an organization’s operations and strategy that are impacted by digital technologies. The four main areas of digital transformation that aligned closely are

Core operations

This area encompasses transforming an organization’s fundamental business processes, operations, and workflows. It involves using digital technologies to streamline, automate, and optimize day-to-day operations such as process automation, supply chain optimization, inventory management, and workforce management. The goal is to improve efficiency, reduce costs, and enhance productivity.

Experience

The “Experience” dimension of digital transformation emphasizes enhancing the customer experience (CX) and sometimes the employee experience (EX). It uses digital tools and technologies to create seamless, personalized, and engaging interactions. For example, developing user-friendly websites and mobile apps, implementing chatbots for customer support, personalizing marketing efforts, and improving online shopping experiences. The employee experience might involve digital tools for remote work, collaboration, and training.

IT Infrastructure

Digital transformation often requires upgrading or modernizing the businesses’ IT infrastructure. It includes hardware, software, networks, and cloud-based solutions. Small businesses can migrate to the cloud, adopt a microservices architecture, or implement DevOps practices to ensure their IT infrastructure is agile, scalable, and responsive to changing needs.

Information management and analytics

Effective data management and analytics are critical in digital transformation. It involves collecting, storing, analyzing, and deriving insights from data to support data-driven decision-making. Big Data platforms, AI and machine learning models for predictive analytics, and advanced data visualization are implemented to drive innovation and gain a competitive edge.

Trends That Are Driving Digital Transformation

There’s a lot of buzz around transformation. After all, global spending on digital transformation strategies is soon poised to break $2 trillion.

Here’s what’s driving this increase:

#1 The rise of remote and hybrid work

The new normal of hybrid workplaces has been one of the most pervasive trends driving digital transformation.

Statista surveyed US workers in 2022 and found that over half were working in a hybrid situation during the last quarter.

Working from home has forced businesses to tap into technology and digital tools or risk hamstringing their productivity and collaboration.

With the shift to hybrid, companies today need tools for:

• Virtual meetings

• Online project management

• Remote access to work resources

• And more

That’s why Zoom, Slack, and Microsoft Teams (among other tools, (including hybrid workplace management solutions) have become so commonplace.

#2 The availability of new technologies

The constant evolution and availability of new technologies is another key driver of digital transformation.

The main technologies spurring innovation include the following:

• Artificial intelligence and machine learning – for example, Netflix and Spotify recommend content based on user behavior.

• Cloud computing – for example, Dropbox and Adobe Creative Cloud give employees remote access to resources.

• The Internet of Things (IoT) – for example, manufacturing industries use IoT for predictive maintenance to reduce downtime.

• 5G technology – for example, Tesla and BMW use 5G to send autonomous vehicles real-time data about their surroundings and potential hazards.

• Digital reality technologies (AR/MR/VR) – for example, Ikea uses augmented reality to allow customers to visualize how different pieces of furniture would look in their homes.

These aren’t just technologies. They’re also enablers of digital transformation — opening up new opportunities for innovation, efficiency, and customer service.

#3 The ability to make data-driven decisions

As stated in a Harvard Business Review Analytic Services 2021 briefing paper, “…it’s never been more crucial for organizations to use data and analytics to inform their next best move.”

That’s because the proliferation of data has exploded.

Companies are increasingly leveraging data analysis to:

• Drive decision-making

• Gain insights into their customers and employees

• Personalize experiences

• Innovate products and solutions

• Manage risk

Why Your Business Needs a Digital Transformation Strategy

Funding for digital initiatives continues to rise. In fact, global spending on digital transformation is forecast to hit over $3 trillion by 2026.

As such, it’s crucial to be on the leading edge of transformation so your business can stay ahead of the curve.

The benefits of incorporating digital transformation include the following:

• An enhanced customer experience, such as personalized digital marketing or 24/7 customer service

• Better efficiency and productivity by automating tasks, reducing errors, and speeding up processes

• Agile business creation by ensuring new business models quickly respond to market changes and incorporate new advancements in technology

• The attraction and retention of talent by bringing in the modern workforce through innovation and a tech-forward approach

You need a comprehensive roadmap to achieve those benefits — that’s your digital transformation strategy.

Here’s why this business strategy is so important:

• It provides clear direction, ensuring your investments aren’t misguided or wasted.

• It helps establish business priorities, letting you focus on the areas that deliver the most value.

• It helps manage risk since you’ll be able to identify, anticipate, and mitigate it.

• It helps measure progress by giving you a standard to measure your progress against and adjust as needed.

• It facilitates buy-in by helping to communicate the purpose and benefits of the transformation to your employees.

The benefits of a digital transformation

While digitally transforming your company sounds like a lot of work, there are numerous benefits, including:

Boosting efficiency and productivity:

 Digital tools and technologies streamline business processes, automate repetitive tasks, and, as mentioned above, provide real-time data and analytics. This improves operational efficiency and enables employees to focus on revenue-generating activities, resulting in increased productivity.

Extending your market reach: Digital platforms and online marketplaces enable you to reach a broader customer base outside your local market.

Saving money: Adopting digital solutions can help you reduce operational costs. Automating manual processes can lower your overhead (you’ll need fewer employees). Using cloud-based services is less costly than investing in expensive hardware and software. And digital marketing, particularly social media, is typically far less expensive than traditional advertising methods.

Becoming more agile and flexible: Digital technologies let you quickly respond to market demands, implement changes, and experiment with new ideas.

Enhancing collaboration and communication: Digital communication and collaboration tools for tasks like video conferencing and project management are especially important if your business is virtual or hybrid.

6 steps to digitally transforming your business

Digital doesn’t have to be disruptive, and it doesn’t have to be hard. For a lot of smaller businesses, adopting a focused and strategic approach is key. Our advice is “don’t try to solve everything at once” – you can rollout your journey in phases.Here are the five key elements of successfully digitising your business:

1. You MUST have an online presence

The move from analogue to digital is now a matter of survival. As more people shop, buy, research and connect with businesses online, the more important having a digital presence is. If you’re not online, you may as well not exist. Even if you have a longstanding and loyal customer base offline, having a website and social media pages is critical for bringing in that new generation of customers.Badly design websites can be just as detrimental to your business. If your site is slow to load, isn’t optimised for mobile, has poor navigation, is difficult to navigate, or confuses your brand identity, users will leave in a matter of seconds and go somewhere else.According to Hubspot, 55% of your visitors spend less than 15 seconds on your website, which doesn’t give you very much time to get their attention and make an impression.Website design and development services can give your business the right impact, building innovative, functional and easy to use websites that users love. If your current website doesn’t showcase everything you do or garner the leads and sales you’re after, it’s time to rethink your website strategy.

2. Create a digital marketing strategy

Digitally transforming your business means using technology to continuously evolve all aspects of the business model. This includes what you offer, as well as where and how you interact with customers.A beautifully designed, functional and easy to use website is only effective if people know how to find it. If you’re not getting any traffic – or if you’re getting traffic but it’s not converting – having a strategy in place can help.A digital marketing strategy can help you optimise your website for search engines through content generation, and attract high-converting customers with techniques such as Pay PerClick advertising. It’s also important to have a social media presence, as customers demand a multi- or omni-channel experience with brands, so make sure your brand can be experienced across all channels.

3. Invest in high quality content of every kind

Successful digitalisation means finding new ways to communicate with your audience, across a range of platforms. Your content needs to inspire, inform and provide useful answers and solutions to customer queries and pain points – and it has to be available everywhere.The ultimate content marketing approach is to cover all bases, from your business blog and social media to external publications. By making it easy for customers to gather information and connect with your brand (even outside of 9-5 office hours), you can deliver the digital experience that your audience craves. And in order to optimise your site for search engines, make sure your content is of the highest quality, has the ability to engage and keep readers on the page, and is being frequently generation to keep things fresh.On top of written content, consider bringing video content and live streaming content into the mix, as millennials and Gen Z like to consume content on-the-go.

4. Digitise your documents – no more paperwork!

Paperwork is a drag, and no-one really enjoys it. Office workers spend over 50% of their day searching for files or information, according to new research. As if that wasn’t bad enough, Gartner reports that one out of every 20 documents is lost – and around 25 hours are spent recreating each lost document.By digitising your documents, you can remove the burden of manual filing and handling, and streamline processes.

5. Identify, optimise and automate

Technologies like automation form the bedrock of transformation. Automating businesses processes and removing the burden of paperwork is the exact definition of “end-to-end business transformation” as described by Deloitte.Getting started with automation may seem like a huge undertaking, but with bespoke system and app development, it’s easy to find quick solutions for labour intensive administrative tasks. Not only does automation make life easier, but it can empower your staff, helping them deliver better customer experience and service.Ultimately, removing manual processes prevents bottlenecks and boosts productivity, while saving your business time and money!

6. Leverage your customer data

Digital transformation begins and ends with the customer, and this is why data matters. When you digitise and use online collaboration and communication platforms to share, store and upload information, you get to manage who sees it and how it is used.Customer data already exists within your business, but tapping into it is a different story. Once you have access to it, you can break down data silos, improve decision-making and improve customer experience through data analytics.