Digital transformation: A necessary change to survive
Implementing change is often hard and slow. Generally, the same sentiment applies to digital transformation. According to a McKinsey report, only 16% of the respondents successfully transformed the way they work and do business (2018). But when an unforeseen occurrence like COVID-19 happens, it can dramatically accelerate the change. Due to the global pandemic, people, businesses and societies have been forced to act fast and change in order to stay afloat. Many companies quickly had to rethink their operations, processes, and even products overnight. Many have been forced to digitally transform the way they work or cease to operate.
Embracing change to create value
Digital transformation is not just about keeping up with times. It’s about creating value. Embracing digital transformation takes time and money, but it can add and generate tremendous value for businesses and their customers. It can improve data collection and analysis, increase the level of transparency, improve employee skill set, bring new customer benefits such as new products and services, better experience, greater convenience, and more choices to only name a few advantages.
Source: Google, 18 May 2020
Domino’s Pizza is one of the most famous examples of successful digital transformation. In 2010, after the difficult times of 2008-2009, Domino’s appointed Patrick Doyle as the new CEO. Through his leadership years, Doyle focused on innovation and convenience, and successfully digitally transformed the company. For example, Domino’s was one of the first to release a pizza tracker to follow the progress of customers’ delivery. An innovative feature in the delivery business at the time. They also opened a variety of digital platforms such as Twitter, Google Home, and zero click app for consumers to order online. In 2017, 60% of its sales came from digital channels compared to 25% in 2010. Under Doyle’s watch, Domino’s Pizza stock price has risen more than 2000%.
Although challenging, the company has shown it’s possible to achieve successful digital transformation that creates value to both the business and its customers. Domino’s Pizza is a compelling example of a company in a traditional sector that used technology to reinvent itself and disrupt the industry.
Mind The Chasm
When talking about the adoption of novel technologies, we often think of Geoffrey Moore’s book Crossing the Chasm. Moore’s model helps us understand how we can drive the adoption of technologies. We believe that in order to reduce the gap between the early adopters and the early majority, we need to create bridges that facilitate the digital transformation for traditional companies.
By working with different partners and companies, we found that many of the large, traditional enterprises need assistance to accelerate their shift to fintech. While there’s a willingness by traditional companies to try innovative products, there is often a lack of resources – either in knowledge or capacity – to execute these novel initiatives because technology often remains foreign.
Based on our experience, companies are open and ready, provided they tick these three boxes: 1) Leadership is on board and lead the digital transformation; 2) Regular communication between all parties involved is established with clear objectives and expectations on what needs to be built; and 3) The right people are assigned to oversee the transformation.
Digital transformation can and has transformed many industries. Not so long ago, perhaps only a few of us would have imagined how finance and technology would merge together to form fintech; how traditional companies would lean towards technology and vice versa. Innovation through digital transformation can drastically improve how we live, work, and communicate. For example, transferring value has never been so easy. From a blockchain network to a traditional payment gateway, we can now transfer value in a matter of minutes by using applications or QR codes.
We believe this global pandemic will serve as a catalyst to accelerate companies’ digital transformation. It’s not only a matter of time, but also a matter of creating value by enhancing enterprises’ connectivity, productivity, and efficiency. Ultimately, we believe digital transformation is necessary in order to survive. Digital transformation can unlock numerous possibilities and we are excited about what the future holds.