Digital Transformation Guide: Milestones and Examples

Everybody’s talking about the digital transformation of business these days. Many business have already switched their products, services, and internal processes to digital; even more are going through this process now.

You’re probably thinking about moving in this direction, too. Yet, it leaves you with many questions like:

• What exactly is Digital Transformation? How can you apply it to your business?
• Who should do it?
• What are the benefits? Do I need it all?
• How much can it cost?

In this article, we’ll answer these questions, guide you through all the key steps of digital transformation, and explain how you can do it for your company. Use the content table on top of the page (it’ll also appear when you scroll down to the next paragraph) to quickly jump to the needed part!

💻 Digital Transformation of Business: What is It?

Before we review the best examples of digital transformation and share some “how-to” insights, let’s first define what we’re talking about.

The topic became especially popular and relevant in the light of COVID-19. The whole world went digital. Restaurants that had already offered delivery got a huge advantage over those that hadn’t and were only jumping at these digital rails. Retailers with a limited online presence and few delivery options were forced to jump on this digital bandwagon. You can find similar examples almost in any industry.

Here's a great introductory video to explain the concept:

Now you're all set to take a deep dive into how exactly you should transform your business!

⚙️ Key Steps of the Digital Transformation Process

Now you’re probably wondering how the DX implementation goes. Yet, it may seem like a quite complex and complicated process with no clear starting point.

How do you start? What should you do then? What steps should you take in the first place?

Thus, we’ll provide you with digital transformation strategy examples. So when you finish reading this article, you’ll have a clear understanding of what’s to be done next.

🏆 3 Major Steps of DX

At the highest level, the strategy consists of 3 big steps or 3 D’s — Digitization, Digitalization, and Digital Transformation. You may see these steps as links of a single chain:

1. We digitize information. Simply: this is the transition of data in an analog form to a digital form; putting information online that wasn’t online before. It may relate to papers, cards, and all other aspects of your business that are done offline & manually so far.
2. We digitalize processes. Digitalization describes the process of using digital tools and technologies to transform different operations — payroll, employee management, delivery, communication, and others. Yet, digitalization is quite a limited process that usually covers one branch or direction, improving it but not reshaping the whole business.
3. We digitally transform institutions. This is a complex process that doesn’t finish when you introduce a new feature or digitalize an old one. It’s rather a long continuous process that is both initiated by and encourages shifts in the workforce, management, culture, products, used technologies and approaches, etc. To succeed in DX, companies should go through significant digitization and digitalization.

You can think of these steps as a ladder:

5. Just do it!

Now you’re all set. Get to work, transform your business, measure the results, and spread the best experiences and practices on other departments and processes in your company!

🗃 Digital Transformation: Business Cases

Let’s move from theory to practice and review a few digital transformation examples from different industries.

💳 Retail | Nike

Retail is definitely one of the industries where you can clearly see DX processes. Retail businesses face quite a strong need to transform since their customers already live in a digital world and use all its benefits. Thus, companies with a weak digital strategy will lose their customers to their competitors.

Retail companies are focused in the first place on digitalization of their products and services they offer to customers. However, a digital transformation won’t be full if you don’t rethink your internal management processes.

These combined efforts helped L’Oréal strengthen its position as world’s leader in cosmetics manufacturing and increase stock value by 252% — from $125 per share in 2014 to $290 in 2020.

💸 What Are the Costs of Digital Transformation?

While the benefits of DX for businesses are quite obvious, it’s not that clear how much it may cost. Actually, it’s quite difficult to provide you with specific figures since:

• DX is a continuous process that consists of many sub-processes (like app development, web development, staff training, improvement of existing tools and others). It doesn’t have a fixed start & end dates.
• The scope of work will be different in every specific case.
• All businesses are different. DX of a local hotel chain and one of the world’s top car manufacturers — are quite different processes.

Thus, it’s impossible to provide you with a rough estimate of digital transformation without having any extra data. However, you can find estimates of mobile apps in the article below. Mobile application development is usually an important part of an overall DX strategy.