Key Challenges of Corporate Digital Transformation in 2021

Digital technology, and mobile technology in particular, has fundamentally changed both human behavior and most corporate business models. Emerging technologies, the availability of consumer data, and the interconnection between machines and human processes are reshaping corporate strategies and operations, thereby transforming management practices.

But what do we really need to know about digital transformation? Why has this concept become so critical in 2021?

Digital transformation is a process aimed at enhancing business management through the integration of information technology, computing, communications, and connectivity. It is pervasive and growth-oriented, but above all, it is an imperative.

While some companies have yet to fully embrace this new reality, most are beginning to transform their business operations. The COVID-19 pandemic has underscored the necessity of digital transformation, to enable remote work and to provide goods and services through online channels. While this has helped accelerate the ongoing trend, a challenge remains: even when a company recognizes the potential of digital technology, it is sometimes unable to adopt it strategically. However, traditional companies cannot afford to wait to implement these technologies, as they are often competing with “born-digital” companies that already possess a digital-first approach and the necessary expertise. These latter players are beginning to dominate certain markets and transform specific industries (such as tourism and banking), and this transformation will impact the entire supply chain.

Only a few studies have attempted to provide insight into digital transformation and its challenges, but there remains a significant knowledge gap regarding how digital transformation should be effectively implemented.

Therefore, we would like to highlight four key issues that traditional companies must address, particularly during what we refer to as the “digital introduction” and “digital strategy implementation” phases:

1 – digital skills. If a company truly wants to pivot toward digital transformation, it must support its employees by offering learning programs that help them navigate this new management approach and the era of big data. This means being able to read and interpret new types of data (unstructured), process them, and make informed decisions accordingly. Companies must develop both technological and analytical capabilities within their teams. Learn more about the’Inbound Value.

2 – an organizational culture where a “trial and error” approach is beginning to become the primary way of conceptualizing processes. A new mindset is required to successfully operate in this rapidly evolving world, where the only way to outlast competitors is to provide solutions, even if they are in beta and may have certain shortcomings. Furthermore, cross-departmental networking is essential to share data and adopt a systemic rather than a functional perspective.

3 – support. Internal support, in terms of senior executives and owners acting as champions of this transformation. If the company’s leaders do not believe in these changes and do not support them, it becomes quite difficult to motivate employees to change their approach and step outside of their comfort zones. External support, in terms of policy, is also needed to assist companies on this journey by providing both resources to improve their systems and IT technologies, as well as learning programs.

4 – technology. This is the final point, as technology is merely a catalyst for digital transformation. In our book, we emphasized that while technology is a prerequisite, it is not sufficient on its own to ensure an effective digital transformation. Therefore, companies should not start with the technology itself, but rather leverage the best available technology to achieve their objectives.