Digital transformation has revolutionized the world in many ways. It has streamlined the business operations of companies across various industries and has made everyone’s lives so much easier.
Amid the global pandemic, the majority of businesses (6 out 10) worldwide have accelerated their digital transformation plans in order for them to thrive and survive in the new normal, as per a study conducted by IBM, a multinational technology and consulting company.
Research by Cisco shows that small and medium businesses have the potential to contribute as much as US$3.1 trillion to Asia Pacific’s GDP by 2024 if they invest in digital transformation. In addition to helping secure their future, digital transformation also helps companies adapt to the new behaviors of the market in the new normal. However, not all companies are on the same page, despite the many benefits they can reap through smart investment in digital solutions.
Some companies are apprehensive about joining the digital revolution, and with good reason. On the other hand, failure to pivot to the demand of the times might result in revenue loss, and worse, might cause the company to close shop. Why are they skeptical about going digital? According to research company Altimeter, here are some of the reasons why there is a clear gap in digital transformation among companies:
1. There is low digital literacy among the workforce
With the utilization of digital tools comes the demand in order to navigate those tools effectively. Especially in multigenerational companies, there is a challenge of getting employees and management up to speed with the latest best practices in digital technologies. Given that the internet became mainstream only by 1991, it is completely understandable that the older generation may find it challenging to adapt to the intricacies of digital transformation.
In fact, according to a study by UNESCO, most adults in low and middle-income countries do not have even basic digital skills and competencies, which poses a challenge to companies looking to usher their organization into the digital age. This solidifies that there’s a need for thorough training and immersion for every company’s workforce to adapt to the digital age.
2. Digital transformation is expensive
Not only does digital transformation entail training among a company’s workforce, but it would also cost the business a lot of money. This may discourage companies, especially small businesses, given their restrictive budget in the new normal. As it is, all businesses are cutting their losses and working harder in order to make a profit alongside the challenges of the pandemic.
However, taking the plunge is integral for the survival of businesses amid the ongoing global pandemic. As per Forbes Magazine, looking at the bigger picture, digitized processes deliver robust value-creation opportunities that go way beyond cost savings. In the long run, the opportunities brought by digital tools will have been worth every peso spent. The sacrifices will have been worth it.
3. It doesn’t fit the company culture
Companies follow a structure for their organization to function like clockwork. Employees understand the inclusions and limitations of their roles. Integrating digital solutions to a business’ operations would have a profound effect on this structure, and would cause problems in the process.
However, disruption is part of the process. That is why it is essential for the company to be aligned in its goals, and understand why digital tools were adapted, to begin with. According to multinational professional services network Deloitte and The Wall Street Journal, as organizations prepare for and work through a digital transformation, it’s vital to create a culture in which everyone is tech-savvy and risk is everyone’s business. The adaptation of digital tools won’t be an overnight process. It will take time and effort, but the benefits will be worth the trouble.
4. There’s not enough staff
The digitization of business operations would require manpower to carry out the duties of digital tools, and some companies lack the workforce to do so. While employees can be trained to utilize digital tools, not everyone is skilled in technical support or troubleshooting.
A survey by global software company Veeam revealed that lack of staff to work on new data protection initiatives (42%) was cited as one of the biggest challenges in digital transformation. Yes, hiring or outsourcing someone for technical support is an additional cost, but it would save your company from more expenses and headaches in the long haul.
5. Investment in digital transformation poses a lot of risks
While the digital transformation of companies has a lot of potential benefits, there are also some risks. Research by multinational technology company Dell Technologies says there are possibilities of security incidents that may affect the company’s reputation and trust issues.
It is important for businesses to understand the risks of acquiring digital tools for their operations, yes, but it is also imperative that they comprehend the bigger risks of forgoing digitalization altogether. It is inevitable for issues to arise, but it’s all part and parcel of the digital transformation package.
Digital transformation requires companies to make a lot of changes within their organization, and not all companies are confident in their abilities to adapt to the demands of digital tools. Change can be difficult, but it is also necessary. The good news is that companies can outsource their digital marketing efforts through partners that can help them stand out amid the tough competition in the new normal.
Eight Media empowers businesses of all scales to make data-driven marketing decisions in order to understand their market better. Through the digital solutions offered by us, companies can thrive and survive amid the challenges of the new normal.