COVID-19 and the Pressure of Digital Transformation
Pre-COVID, most companies were in the early stages of ambitious digital transformation programs, but now they no longer have the luxury of time. In just a matter of months, digital adoption has been thrust forward several years. Digital initiatives that companies have been eternally putting off have become the top priority, albeit adapted through the lens of the “new normal”.
Adopting a Through-Cycle Mindset to Change
While it might feel counterintuitive to invest against a backdrop of plummeting revenues, missed budget estimates, higher costs, and strained employees, technology and infrastructure, this is precisely the right time to advance your digital agenda.
While some CEOs are pulling in, making cuts, and taking a “wait and see” approach, others are adopting a through-cycle mindset. These CEOs are taking decisive action now, investing in technology to face challenges head-on in the immediate term, and are poised to take advantage of the upturn when we inevitably emerge from this mess.
This approach from CEOs is backed up by Pricing Partner at Bain, Chuck Davenport, “I think anytime is the right time to start this digital transformation in pricing. But if you do it right now, it’s a special time because we were all hoping for a pretty shallow trough on this downturn. But however deep it is, if you get that transformation even going because time to value is really quick in this area, when the economy is starting to come out of the trough, your acceleration is that much better…”
We saw it in the 2007-08 financial crisis, and we’ll see it again, those companies that move early and with boldness in an emergency do best, while their slower-moving competitors fall by the wayside.
What Factors Are Driving Digital Transformation?
COVID-19 is the “digital accelerant of the decade”, catalyzing 97% of respondents’ digital transformation plans in a recent Twilio survey of 2,600 enterprise decision-makers. The immediate drivers are obvious – social distancing restrictions have brought about a monumental shift in how we connect with our employees and customers. Digital channels have become the primary means of communication and will remain so in the new normal.
Other drivers are more subtle. Barriers to digital transformation have come crashing down seemingly overnight. Getting executive approval (and budgets) for digital transformation projects has become a cinch – even those whom CTOs have been petitioning for years. A reluctance to replace legacy on-prem solutions has been swapped for widespread acceptance of the need to transform fast and secure the first-mover advantage.
“…if you get that transformation going, because time to value is really quick in this area, when the economy is starting to come out of the trough, your acceleration is that much better…” – Chuck Davenport
Companies are surprising themselves by how quickly they can act when forced into a corner. Digital transformation strategies are being shaped in record time. CEOs are finally recognizing the value of being adaptable to threats and shocks in the market, which is what digital transformation is all about. They’re prepared to take on the additional challenge of adopting new software while operations are confused.
Cloud-based SaaS Solutions Are Supercharging Innovation and Agility
The emergence of cloud-based SaaS solutions has made adapting to change that much easier. Rather than build out new software from scratch, companies can harness the power of specialist SaaS solutions at remarkable speed. There’s no need to pay substantial up-front costs for purchase or installation. Pay-as-you-go type models further reduce financial risk, enhance scalability, and improve agility in uncertain times. Companies investing in pricing software are already seeing ROI.
With SaaS, installation and integration within existing IT setups are not only cheap but extremely fast. And being cloud-based, these solutions can be accessed from anywhere, through any device, which is ideally suited to remote working – another trend that’s predicted to extend long into the new normal.
It’s Time for Bold Change
Digital transformation doesn’t mean merely replacing old manual solutions with shiny, automated new ones. Nor should it just be about IT. It’s an opportunity to reimagine your strategy and business model for the post-pandemic age, redesigning customer journeys to reduce friction and accelerate the shift to digital channels.
Successful digital transformation requires bold leadership, bold goals, and a healthy regard for experimentation and creative solutions. Without an aggressive approach, digital transformation occurs at the fringes rather than at the core of organizations, where the impact and ROI are felt most keenly, uniting front, middle and back offices around the customer and breaking down silo mentalities associated with on-prem solutions.
The Technological Landscape Is Awash with Opportunity
While it can be hard to see beyond the immediate health and economic crisis triggered by COVID-19, companies would be remiss to ignore this unique moment’s digital transformation opportunities.
It’s a chance to redefine core business models, improve data security, defend and unlock new revenue-generating opportunities, and insulate your business from future shocks. It’s an opportunity to open up remote working capabilities, attract a global pool of talent, and acquire the technical skills your company will need to prosper under new normal conditions.
It’s time to adopt an omnichannel approach. Customers no longer want to buy with a salesperson breathing down their neck. They want to carry out independent research in their own time. They want to buy remotely, through a range of channels and devices, from e-commerce to social media and mobile apps with VR and AR capabilities.
Internally, it’s an opportunity to swap out siloed, disconnected, legacy solutions for a single source of truth – a cloud-based, centralized hub that everyone has access to, fueling greater collaboration, transparency, and accountability. It’s time to automate all those time-sapping, menial tasks that stop your employees from focusing on creative, innovative ways to improve customer experience and maintain agility in the face of such rapid change.Fast