A blog about software development best practices, how-tos, and tips from practitioners.

Enterprise Digital Transformation | Best Practices

Enterprise Digital Transformation | Best Practices

Back in April 2015, Starbucks announced that its quarterly revenues for the quarter amounting to $4.56 billion exceeded the year-over-year attainment by 17.8%. It was obvious that it got a lot of attention. It was quite unheard of in the food industry retail business. Yes, Starbucks added 210 stores but that can hardly contribute to this kind of revenue results. Starbucks also reported that the phenomenal earnings were because of the 10.3 million loyalty members using their proprietary mobile app.

It is found that the Starbucks loyalty members spend 3 times as much as a non-member. The specifically designed Starbucks mobile app allows the loyalty members to place their orders without any hassles – the members can place the order from their app, make the payment through the same app and by the time they reach the store, their order is ready and they can collect it without having to go through the long queues! For the busy customers of Starbucks, this is a pure bliss.

This is one of the brilliant examples of success with digital transformation. Starbucks could not only connect with its customers better but also created a great upselling opportunity through the app. Unlike other companies, which have a mobile strategy, Starbucks focused on creating a digital strategy for enhancing the customer experience using the most used technology, mobile.


digital transformation 

When it comes to digital transformation, Enterprises often think about using technology to bring in the changes in which the business is conducted. However, digital transformation is about technology as well as humans. It is about leveraging the digital revolution where people are highly connected to address the newer challenges and opportunities. It is about how to enhance the online presence, how to connect and engage with the customers, how to gather customer feedback, how to measure customer sentiments and address those, and how to use the mobile technology to connect with the wider and more connected audience.

What Makes Digital Transformation Successful

Technologies such as Social, Mobile, Analytics and Cloud (SMAC) are the key drivers in the IT modernization as well as digital transformation. The focus of IT modernization is on increasing the efficiency while decreasing the costs. Whereas, the focus of digital transformation is on identifying and implementing new ways of doing business. It is more about innovation and bringing in the transformation in business models to be able to effectively leverage the digital avenues.

According to the 2015 Digital Business Global Executive Study and Research Project by MIT Sloan Management Review and Deloitte, strategy and not technology, is the key driver in the digital transformation arena. The study found that while putting together the digital transformation plan, more matured businesses focus on the end-to-end integration of digital technologies, whereas, the less-mature businesses are focused on solving the business problems independently using separate technologies.

The real power and success of digital transformation lie in the overall scope and objectives. Instead of focusing on solving small problems separately, a more coherent strategy which is developed with an aim to transform the business is more likely to succeed.

It is also important that the enterprises arm their employees with the required skills to support the digital transformation. Employees, on the other hand, are usually keen to work with digitally-advanced organizations. Retaining and attracting the talent for the enterprises, therefore, means upgrading their digital quotient.

Trends and Predictions

According to IDC, the biggest issues in IT leadership will be around business needs, capabilities and availability related to digital transformation. Two-third of CEOs plan to focus on digital transformation strategies for 2016 and the major players leading through this shift will be the CIOs. By 2020, the number of enterprises creating digital transformation initiatives will be more than double.

According to Gartner, 125,000 large organizations are launching digital business initiatives now and their CEOs expect that by 2020, their digital revenue will increase by more than 80%.

Following are some of the prominent trends and predictions –

  • Access to talent with new skills such as mobile app development, data analytics and design will be the key differentiator for the enterprises.
  • Big data will play a critical role in delivering personalized services and enhancing the overall customer experience – digital transformations will need to establish well-thought out data streams in and out of the enterprise.
  • Internet of Things (IoT) will be the key influencer in digital transformation. With millions of connected devices, IoT will redefine the interactions between consumers and enterprises, enterprises and suppliers, enterprises and their distribution partners.
  • Artificial Intelligence will help in creating business models to create new revenue streams.
  • Rapid mobile app development to improve sales and overall customer service will be the priority for the CIOs. The trend will also be towards integrating these custom apps with the back-end legacy systems.

According to a survey by Everest Group, 43% enterprises hit a roadblock after the initial stage in their journey of digital transformation. If the goals and ROI are not clear, then the enterprises can go down a spiral with fewer investments and no real returns.

A successful digital transformation initiative requires clearly defined strategic objectives – the efforts and ROI measurement depend a lot on the defined objectives.

All the teams, including the IT as well as business teams, need to work coherently and collaboratively towards the common goals. The alignment between the cross-functional teams is important to drive digital improvement and derive true business value.


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