COVID-19 has shown that the Internet is much more than a technology. Next Sunday is International Internet Day and the memory of this event has made us reflect on its importance in the digital transformation of companies in the current health and economic crisis.
Although what is truly important about digital transformation is the transformation itself and not the way in which it is done, the Internet plays a prominent role in the change. And it is that the Internet, as the sociologist Manuel Castells said, is a means of communication, interaction and social organization but also business organization.
Of course, as we will see later, the Internet will be linked to many of the transformation processes, but not to all.
digital transformation concept
The COVID-19 coronavirus is taking its toll on the business fabric as a whole but it is taking even more toll on those little-digitized and traditionally offline businesses that have suffered the consequences of confinement. Online businesses, however, have paved the way thanks to the digital transformation they have been experiencing. But let’s address the concept of digital transformation in companies in greater depth.
In a definition of walking around the house, we could say that the digital transformation in companies is the incorporation of technology in the areas of business activity, substantially changing its operation or its products, something that depends on the levels of digitization.
We are not referring to the same thing if we talk about the digitalization of business processes or the digitalization of the business. In the first of the concepts, technology reaches the internal processes and company strategies, modifying the company culture; but if we stick to the digitization of the business, this transformation is complete, even reaching the business model, the products sold and/or the services provided. In an online business model, the Internet will be the protagonist.
Advantages of addressing the digital transformation of companies
We could talk at length about the benefits of business digitization but among all the advantages the following stand out clearly:
Cost savings: This is probably one of the most attractive benefits. The digital transformation supposes economic and time savings due to the automation of processes.
Increased productivity: This advantage is closely related to the previous one. Digital transformation streamlines processes, optimizes time management and promotes higher performance. Automations simplify tasks.
Comprehensive analysis: Complex processes can be measured to improve decision making.
Differentiation, competitiveness and innovation: The digital transformation within the company offers opportunities for innovation and competitiveness in a business fabric that still has a long way to go towards transformation.
Adaptation to the market: The health crisis is going to give rise to the reinvention of entrepreneurship. Digital is presented as a paradigm of new business ideas based on current consumer needs.
Adaptation to the digital transformation of the Public Administration: The digital transformation of some administration and management processes is almost a legal imperative. As we will see later, the relationship of companies with the Treasury and Social Security is increasingly based on telematic processes.
Which business activity processes can be digitized
We have mentioned at the beginning of these lines that digitization can mean a change in the business model based on the conversion of products or services or acting solely on the operational, support or management processes. But let’s get to the practical, far from technicalities about business organization. There are numerous daily tasks that can be managed at the click of a button, either supported by the connectivity offered by the Internet or through programs supported by internal networks that do not transcend the Internet.
Business administration and advisory service: Submit taxes or annual accounts of the company; keep accounting books; order invoices for supplier expenses, pay the company fees of the workers… The consultancies have adapted our processes in line with the Administrations that have their own electronic headquarters and we are working on the adaptation process with our clients so that soon our communications, sending and collecting documentation and personal assistance will increasingly use online platforms and the advantages of digitization that speeds up response times, improves efficiency and saves time and travel expenses.
Customer management: Numbering customer invoices, managing their incidents or viewing the history of purchases are just some of the many actions that a CRM (Customer Relationship Management), cornerstone of the digitalization of management and customer service and support for marketing and sales strategies, you can develop. In this case, the Internet connection is not necessary since it deals with internal programs.
Departmental projects and tasks: Implementing a new sales strategy can involve several departments or professionals. Much of the success of the strategy depends on coordination and interdepartmental communication. Hence the incorporation of project management tools back in the day.
Document management: Paper is a thing of the past. Each of the aforementioned tasks is based on document management in the cloud. Even the most traditional businesses make use of storage services like Google Drive.
What if we are not talking about digitalization of processes but about a change in the business model? The Internet of Things has revolutionized the overall technology landscape and business trends based on connectivity strategies.