Digital transformation is a term that describes implementing technology in a company to achieve organizational growth.
Successful digital transformations bring many benefits to a company in terms of efficiency, revenue, and return on investment. With such valuable outcomes, digital transformation is a big business in itself. Data from Statista shows that global spending on digital transformation doubled between 2017 and 2022. It’s projected to climb even higher in the next few years.
This article will describe five digital transformation success stories illustrating how businesses have benefited from digital initiatives. We will look at the key aspects of technological transformations at IKEA, Armstrong, Capital One, Microsoft, and Nike.
These companies have improved their business operations dramatically through high-impact digital adoption strategies and provide examples for any organization seeking to expand its digital capabilities.
What Is Digital Transformation?
When a company goes through a digital transformation, they implement digital solutions to change its organization positively. Transformation projects can be tiny, vast, or any size in between. This means that digital transformations can look very different between companies.
It might be a new standalone online portal, a centralized system to manage human resources, or a complete re-configuration of a business. But they all count as digital transformations.
To have a successful digital transformation, you need an effective strategy. This means looking at the entire company and thinking about what changes would benefit the most people. Once you have your goals, you can start developing a plan to make your transformation happen.
One common goal of digital transformations is to reduce costs. This can be done by automating processes or making it easier for employees to do their jobs. Another goal is to improve customer satisfaction by providing better customer service or offering new features and benefits that customers want.
Digital transformations can be challenging to implement, but the rewards can be great. With a successful transformation, you can improve your company’s bottom line and make it more agile and responsive to change.
What Are The Four Areas Of The Digital Transformation Process
There are many competing ways of judging how to deploy new digital technologies effectively and efficiently. However, the four main areas of digital transformation include:
- Customer Experience. Digital transformations should improve the service that customers get from a company. Even when the transformation affects internal processes, management should focus carefully on the end result.
- Data & Analytics. Companies can find ways to gather precise data across their systems, providing a stable basis for future decision-making.
- Cloud Computing. The cloud is a vital tool for digital transformation, enabling software provision and data sharing that would have been unthinkable a decade ago.
- Mobility. Software and digital technology are used across many devices. Digital transformation does not just happen on desktop PCs. It travels wherever processes can be improved.
A small-scale digital transformation may develop just one of these areas. But a truly digital workplace will excel in all of them.
The Value Of Taking a Digital Transformation Journey
There are many reasons why adopting digital solutions in a company is valuable for a business.
As with any innovation, they are intended to improve operational efficiency, increase organizational agility, and create a competitive advantage that leads to revenue growth.
The specific improvements of a digital transformation journey will depend on the business, the transformation strategy, and the intended outcomes.
However, some benefits can include the following:
- Improves customer experience
- Great market reach
- More efficient supply chains
- Greater employee productivity and job satisfaction
- Well-targeted marketing campaigns
In short, digital transformation can positively impact every area of a business.
The State of Digital Transformation in 2022
Business-wide digital transformations have improved services, raised customer engagement, and helped companies stay relevant for thirty years or more. Businesses now have many examples that they can look at for inspiration and guidance.
Some recent transformations include:
- McDonald’s in Italy streamlining their procurement processes through an online portal;
- Domino’s Pizza utilizes the internet of things to help customers place orders;
- Hasbro uses data about their customers to improve their advertising and marketing to customer data;
- UCIS reducing paper and increasing digital applications using AWS cloud computing.
These cases illustrate the varied roles technology can play in an organization. The best companies will not be interested in “off-the-shelf” solutions. Instead, they will find new ways to deal with their fundamental problems.
The Top Digital Transformation Success Stories
To see how companies adapt to a new digital landscape, it’s essential to look more closely at some case studies. From the many success stories out there, the following five companies are incredibly successful examples of large-scale digital transformation in 2022.
IKEA
IKEA dominates the furniture industry. The company has done this by adapting to new working practices. Their digital adoption strategy has recently helped them keep their competitive advantage over other companies.
IKEA’s stores used to be very different from an eCommerce platform. But when they started to prioritize the digital side of their business, online sales tripled. Their brick-and-mortar stores now act more like fulfillment centers than retail outlets. Even within stores in selected countries, customers can now pay for their purchases without going through the checkout.
Underneath the customer experience, the company quietly revised its supply chain systems. It was only possible to change one process.
The example of IKEA shows how a full digital transformation process can help a company to stay relevant.
Armstrong World Industries
AWI is one of the USA’s leading manufacturers of ceilings and walls, bringing in a revenue of over $1 billion in 2021.
Armstrong’s digital transformation started by improving weaknesses in its financial processes. This meant investment in Enterprise Resource Planning (ERP) software, transparent spending, and attention to cybersecurity.
These improvements became the basis of further digital strategies to support customers through their buying journey, with a massively improved website and customer services.
For Armstrong, the digital transformation started with financial systems but ended up providing a fully improved customer experience.
Capital One
Capital One has used new artificial intelligence technologies to provide brilliant customer service. As one of the first banks to manipulate Amazon’s Alexa-enabled devices, their customers can now quickly get the information they need when they need it.
By asking, “what’s my balance?”, “How much is my next car payment?” and “what’s the due date on my next credit card bill?” customers get answers without even logging in to online banking.
Capital one shows how a focused digital adoption strategy can improve customer service. Their digital transformation project reconfigured only part of the business. At the right time, small interventions can produce very effective changes.
Microsoft
Microsoft have been leaders in software innovation since the dawn of home computing in the late 1980s. But faced with the advent of cloud-based software systems in the early 2000s, their long-established distribution model suddenly seemed dated.
Their digital strategy was to completely overhaul their delivery systems, using their proprietary cloud solution. They launched Microsoft Azure in 2008. Azure has now become the 2nd biggest cloud provider in the world, providing a vast range of digital services for individuals and companies of all sizes.
As market leaders, Microsoft could have chosen to behave like Blockbuster video. Instead, they made a shrewd decision to completely update their digital strategy. Without that radical change program, they could already have been forgotten.
Nike
Nike, the global sportswear leader, showcases the excellent results that digital transformation initiatives can create.
Nike’s entire approach to branding, sales, and technology has changed.
They now focus on becoming a robust direct-to-consumer brand, reducing their retail partnerships, and increasing their work to create online sales. Programs like Nike Training Club collect detailed consumer data and use advanced analytics to make sense of the patterns. Smaller physical stores now do a lot of work to promote the Nike brand.
Behind the scenes, they use headless commerce to develop multiple online sales channels, with particular expansions into mobile apps and technology.
Like IKEA, Nike has dominated their market section for a long time. Their success in digital transformation means that they will continue to dominate. Instead of sticking with what they know, they’ve taken risks that have paid off.
Why are Some Businesses More Successful Than Others At DX?
Companies like Nike, IKEA, and Microsoft, make digital transformation look easy. These success stories are inspiring. However, not every digital transformation projects succeed. And when digital transformation fails, it fails big, sucking in money, limiting sales, and destroying staff morale.
The problems are rarely just technical. The project needs to improve when the implementation is poorly planned. Some fundamental issues may include the following:
- No vision for the transformation;
- Poor communications across the organization;
- Lack of buy-in from staff;
- Poor timing.
There are ways of preventing these problems. For example, using digital adoption platforms as the backbone of digital organizational changes can support leaders in making effective decisions on organizational change adoption.
IT consultants and digital transformation frameworks can also significantly impact the chances of success.
How Every Business Can Remain Transformative In An Uncertain Climate
Current business leaders and employees globally have lived through some of the most uncertain years in a generation. The uncertainty of the future has never been clearer.
When a crisis comes, digital transformation initiatives can learn from models of “complex change.” Organizational change is complex when it is made challenging by one or more factors, including crises, employee resistance, and financial demands.
Advanced managerial models, such as the Lippitt-Knoster model of complex change, can provide the help organizations need to keep moving forwards.
How To Drive Successful Digital Transformation
Driving a successful transformation is all about developing the right culture and using the right strategies. Here are some important areas that will help create more success stories:
- For digital adoption, the employees in an organization can create more problems than the technology itself. At every stage of the process, staff must be encouraged, trained, and listened to. With their investment, it will be possible for a transformation to succeed.
- Digital infrastructure also should be part of the solution. A Gartner report shows that by 2025, up to 85% of business operations will be built on cloud services. Cloud solutions are now a proven way of securely handling transformation. An efficient cloud platform sounds like a big change, but it could help the whole process.
- As the transformation process progresses, collecting data is more critical than ever. Leaders can use data to understand the employee experience and ensure that supply chains are moving appropriately and technology is utilized effectively. A digital adoption platform is one way to make technical data collection much easier.
- Find a management style that will help the business to keep up with the complex change. Agile methods are a proven method of success, giving leaders and employees the tools they need to change and adapt as a change process goes on.
Looking Forward: The Future of Digital Transformation & Business Success
Businesses that want to use future technology successfully must learn how to embrace change. It’s more than just now; see how new technology works for other organizations. As new technologies emerge, leaders must find new ways of dealing with their problems.
Some strategies that will improve the chances of success include:
- Find opportunities to automate wherever possible. Automating routine tasks is one of the most straightforward applications of new data systems. More importantly, it can be accomplished without overall changes to the business.
- Create opportunities for continual training and learning. Get staff up to speed on the solutions your leaders are investigating. Send them on specialist courses. Introduce learning opportunities within the company. If staff get stuck in their old ways, they will be less willing to adapt to new challenges.
- Consider alternative business models and organizational structures. As the examples above illustrate, a complete digital transformation goes hand in hand with significant changes to the organization’s overall working model. When a business continually considers its options, it will be better placed to
- Foster an agile mindset in every employee. Agile management techniques are one of the best ways to achieve successful change. When employees can approach tasks in an agile way, they will be ready for anything.
Learn How to Drive Growth From Success Stories
The five companies showcased in this article share one vital quality. They all proactively looked for a digital transformation strategy. They did not wait for other organizations to show them how to create a digital business. Instead, they adapted their digital tools to meet the changing consumer demands and expectations.
In other words, successful digital adoption comes down to culture, attitudes, and leadership. Research from McKinsey has shown that leadership is the most important, with up to 70% of organizations introducing management changes to see the difference through.
