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What is Digital Transformation? It’s More than Just an Overused IT Buzzword

Can I take off my marketer’s hat for a moment and get real with you? In the pantheon of overused information technology buzzwords, “digital transformation” ranks right up there with “big data”, “disruption”, and identifying any competent IT professional as a ninja/rockstar/wizard.

I’ve spoken with tech people in my circle that outright loathe the term. Maybe it’s the fault of countless speakers on the tech circuit that inject it into their keynotes with reckless abandon. Maybe CIOs who use it as a blanket term for modernization are to blame. Maybe vendors who use and reuse the term ad infinitum to market their solutions are the culprits. Maybe all of them, but the point I’m going to make here is important:

Regardless of the overuse of the term “digital transformation” or the semantics of when it’s used, the concept represents a powerful movement in the business world, one that cannot be ignored no matter how much eye-rolling you do upon hearing the phrase.

what is digital transformation

What is Digital Transformation? Digital Transformation Defined

Let’s start with a textbook, academic definition of digital transformation from the Citrix glossary and move outward from there:

Digital transformation is the strategic adoption of digital technologies. It’s used to improve processes and productivity, deliver better customer and employee experiences, manage business risk, and control costs. Digital transformation represents myriad tools, solutions, and processes. An effective strategy is one that’s customized for each unique organization.

Digital transformation is, in effect, when companies make use of powerful technology to transform their business. It’s a wholesale move to consider how to digitize every part of the business, as almost every part of the business now needs technology to run. It could be in any area — customer service, operations, human resources. In days gone past, digital transformation projects were perceived as an IT initiative. But now that we live in a digital world, digital transformation has become synonymous with business transformation.

Director at global tech consultant DataArt Dmitry Bagrov hit on an important point — that the terminology doesn’t matter. “What matters is that the world is changing, and businesses must respond to the change. It could be called ‘organic growth of business’ or ‘vegetarian transformation.’ The term is irrelevant, the key issue is how to transform business to match changing reality,” Bagrov says.

what is digital transformation

Digital Transformation Drivers

Survival.

I mean we really could end this section on digital transformation drivers with that one word. Companies are embarking on a digital transformation journey to keep pace with (and outpace) competitors, incumbents and newcomers to their industry. Organizations are looking to shed old, clunky processes and replace them with efficient ones to become a well-oiled machine. They need to embrace the change lest they become victims of disruption. As Atle Skjekkeland said in his keynote at the M-Files INNOVATE 2019 event this year:

EVERY organization, EVERY executive, EVERY individual, and EVERY object is now on a digital journey. Organizations need to decide whether they will be disrupted, manage the disruption, or want to lead the disruption.

Digital transformation is responsible for several success stories — Uber, Amazon, Facebook, we all know those ones. But what about grocery stores that have made it easy to get your grocery list ordered and delivered online? What about the lending industry, which has made it faster than ever to get approved for a loan online? I mean the examples are endless and they touch every industry. Technologies like big data, cloud, the Internet of Things, artificial intelligence… they are all helping organizations develop new ways of doing business and presenting opportunities to change established ways of running operations.

what is digital transformation?

How to Take Advantage of Digital Transformation

Here at M-Files, we are firm believers that information management should be a cornerstone to any organization’s digital transformation strategy. Too many companies suffer from lack of visibility into unstructured data. They suffer from this sort of closed-source siloing of information into disconnected, disparate systems — CRM, ERP, network folders, staffers’ laptops… you name it. M-Files is an elegant solution for solving those problems and making businesses more agile and efficient.

But whether it’s information management or IoT or big data, one of the first things companies should do when they embark on the journey is answer a simple question: What outcomes do you want to achieve for your customers? Because, after all, they are the ones that realize the benefits of your digital transformation. “It starts with the business outcomes and the new business models you’re going after and working backwards from there,” says Genpact CEO Tiger Tyagarajan.

While digital transformation is one of the most frequently used catchphrases in the IT business, definitions diverge a bit. What we can all agree on is that, beneath the hype cycle, digital transformation means some pretty important changes to business culture.

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