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Light at the End of the Tunnel: How Digital Transformation Has Evolved in the Coronavirus Pandemic
Coronavirus has transformed our lives forever. The way we work, shop, eat, seek medical advice, socialize, and entertain ourselves has fundamentally changed. The human cost of this disease has been unprecedented, and the economic impact of coronavirus has been devastating; billions if not, trillions of pounds worldwide have been lost in revenue across all industries and sectors.
If there were any doubts about that digital transformation is essential to business longevity, the pandemic has put an end to them. In a socially distant world, the vast majority of interactions with customers and employees must take place online. With rare exceptions, operating digitally is the only way to stay in business through the different waves of infections and tiered lockdowns. It’s go digital or go dark. Business leaders need to accept the inevitability of preparing a digital transformation strategy. Without digital tools and technologies, we would have no way to work, shop, go to school and more.
For businesses that have been unwilling to warm to the idea of digital transformation, the pandemic has given them a harsh reality check, exposing how unprepared they were. In April 2020, almost half the people employed in the UK were working from home. 86% of these said they did so because of the coronavirus pandemic.
On top of the pressures of the workforce being exposed and compromised by the pandemic, the economy being shut down, and lasting effects being felt for over a year, business leaders are moving quickly to migrate their operations and workforce into a virtual environment. Companies that tech-enable their businesses during a recession tend to become more resilient to future shocks. Successful tech companies have long recognized that spending rather than saving is the way to survive recessions.
Digital transformation projects will help with the coronavirus recovery
After the initial shock of the first lockdown in March 2020, IT services, infrastructure and application software companies felt the pinch or in some cases, a knockout blow of the uncertain future ahead. IT projects were delayed, scaled back or cancelled.
However, nearly a year later, numerous reports published by industry experts, such as the Harvard Business Review and Gartner, have shown that rapid business deployment of digital initiatives in response to the coronavirus have been a success. On average, digital offerings have leapfrogged seven years of progress in a matter of months. Going forward in the coming months, targeted, tactical digital transformation will be vital for companies to survive.
Arguably, the world has learnt to cope with the coronavirus, and uncertainty and despair have taken a back seat as opportunities have arisen. Cloud service providers and cybersecurity experts have benefitted from the global shift to remote working. Demand for entertainment, gaming, and video streaming surged as people were confined to their homes but needed to keep entertained. Ecommerce platforms found themselves overwhelmed as store closures and restrictions on movement forced customers online.
Spend on Technology to Survive
Many businesses are averse to reaching into their pockets in the current economic climate. There is a misconception that digital transformation requires a large upfront cost to maximize results. The best way to start small is to know what you are going to keep “so you don’t throw the baby out with the bath water”. You can slowly scale up. Done in the right way, digital transformation can be self-sustaining, with each gradual improvement paying for the next stage of the journey.
To chart a course for the future, many organizations seek inspiration from the way that successful businesses navigated the turbulent economic events of 2008, 2001, and earlier. Past recessions show that controlling costs by improving operational efficiency—a task for which digital solutions are perfectly suited—is more successful than traditional cost-cutting measures alone. For example, Harvard Business Review research established “companies that rely primarily on workforce cuts to manage costs only have an 11% chance of coming out of a downturn, whereas companies that focus on operational efficiencies over layoffs are more likely to experience breakaway performance”.
Digital transformation efforts that get six key factors right have a greater than 80% success rate:
- Integrated strategy with clear transformational goals
- Leadership commitment from CEO to middle management
- Deployment of high-calibre talent
- An agile governance mindset that drives broader adaptation
- Effective monitoring of progress toward defined outcomes
- Business-led modular technology and data platform
Accelerators in Digital Transformation
Organisations need to adopt an open mind set to a wider variety of technologies. These range from cybersecurity, cloud computing, automation, the internet of things (IoT) to artificial intelligence (AI). These technologies accelerate digital goals and can enable companies to recover from the coronavirus economic recession quicker than their competition.
Summary
In an uncertain world, one thing that has stayed constant is the coronavirus pandemic, which will be a thorn in our side for the foreseeable future. It has altered what we thought was the norm in digital transformation and has challenged the way we will proceed. However, it’s not all doom and gloom, there is light at the end of the tunnel. Pursuing digital transformation in the face of uncertainty allows businesses to complete easily quantifiable digital initiatives, even in the face of limited resources.
If your business is in need of a strategy update to cope with the current environment, you can count on CTG. We can start with a short introductory session in which we can review and reshape your vision for the business.
This vision and strategy will guide you in the choices you make, the order you approach your digital change programme and help you identify where you should be investing.
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