Digital transformation is no longer about competitive edge – it is a must for survival.
Many companies have learnt this the hard way (RIP Blockbuster). In simple terms, digital transformation refers to the integration of digital technology in to the daily processes and strategies of a business.
This leads to a drastic change in the way a company is run, how it produces its revenues, and how it presents its brand to the world and interacts with consumers. In today’s time, any company that is not using technology or internet in its everyday processes is just a few days away from being forgotten by consumers.
However, the necessity does not mean that the transformation process is easy for companies. It requires a completely new way of looking at and doing things, strong leadership, willing employees, and the capacity to take risks.
If you are looking for some inspiration, here are some examples of digital transformation that will show you just how it is done. Before you delve in, make sure you understand what digital transformation is, and how it is important
With the increasingly low footfall at brick-and-mortar stores, Swedish furniture giant Ikea was no longer able to attract customers with its dizzying mazes of perfectly laid out rooms. The company began selling online in 2009, but still stumbled.
Realizing that it had to step up or risk fading away, the company began taking radical steps towards digital transformation.
It acquired TaskRabbit, a labor-demand matching service, in 2017, ending the oft-frustrating struggle millions deal with while installing their Ikea furniture. It began using data analytics and software to streamline its supply chain at over four hundred locations.
Most interestingly, Ikea also began dabbling in smart appliances in 2012, thus ensuring that it would be at the frontline of the consumers choice when Internet of Things (IoT) becomes common.
In 2018 the company hired Chief Digital Officer Barbara Martin Coppola, thus signalling to the world that it will continue to innovate and integrate in the digital realm.
It might be surprising to see Microsoft here as among the examples of digital transformation. But the company’s revival has great lessons for businesses.
Once at the forefront of the age of tech, Microsoft faced a downturn in fortunes (and stock price) as giants such as Amazon and Apple took off. In 2014, Satya Nadella took over the position of CEO, and made cloud computing the center of the company’s attention.
In doing so, the company was able to move to the more dynamic and lucrative market of both personal and enterprise cloud use.
Microsoft also became known for its partnerships during this time, including the famous Microsoft ♡ Linux proclamation. The company thus quickly turned itself from a respected but ‘has-been’ to a dynamic and innovative company, a perception seen in its consistently rising stock prices.
New York Times
When it comes to examples of digital transformation, few compare to the New York Times. The shift to digital hit both newspapers and journalism hard.
On the one hand, people could gain any news instantly from around the world on their phones. Simultaneously, the rise in competition and unethical advertising practices was leading to the rise of click-baits and hyper-sensationalism of news.
Instead of opening the floodgates of digital advertising, the NYT shifted to a digital subscription-based model. This enabled it to continue an unbiased coverage of events and leverage its century-old reputation, as one of the most respected sources of journalism.
Alongside, it experimented fearlessly, launching cooking and crossword apps, delving into different formats, and using its customer data to encourage subscription.
It has worked very well – the NYT has 2.2 million digital subscribers, and continues to pull high revenue and stock prices, all without opening itself to advertising models that have corrupted numerous sources.
Once synonymous with a happy childhood, good times, and creativity, toy-making giant Lego was facing dark days in 2004. Brought to the brink of bankruptcy by the sudden boom in video gaming, Lego had to radically change its strategy.
The company began to implement a number of innovative ideas for the digital realm. It asked online communities for ideas on products and created a social network where people could display their achievements in Lego.
It launched an app, and to increase visibility to a whole new generation of children, created a series of Lego movies. Currently, the company is also pioneering 3-d printing and robotics.
These strategies of digital transformation served Lego very well, and in 2015, the company became the world’s most powerful brand, taking over the top spot from sportscar marker Ferrari.
Disney’s rapid and radical digital transformation, like that of the New York Times, is a stellar example of how companies can leverage their existing asset into the digital realm as well.
The company began in its theme parks, where it created custom digital wristbands for customers, updated park technology, and trained employees on how to use it.
But perhaps the biggest way in which Disney has entered the digital realm is through its streaming platform Disney+. Many other companies have tried to enter the streaming war, but Netflix has not had any viable competition till Disney arrived.
Disney+ depends on a mix of classic movies straight from the vault and has been releasing original content for two of its biggest franchises – Star Wars and Marvel – to keep the subscribers coming in. Despite concerns about how too many streaming platforms would not end well, it seems that Disney+ is holding well on its own.
These companies remind us that no matter the circumstances, any business can thrive with the right leadership, a willingness to take risks, and innovation. Hopefully, these examples of digital transformation will inspire you to dive in as well.
Can you think of other companies whose digital transformation journey should be mentioned? Can a company really survive without a digital arm today? What do you think? Let us know below