Digital transformation is the process of whole-scale change that affects every aspect of a business through embracing digital technologies. It requires using tools like analytics, cloud computing, big data, social media, and smart technologies to better understand customers and change relationships. Strong leadership from the top, like the CEO, is important to drive digital transformation and keep the process on track. While many businesses are undergoing digital transformation, some lack research on customer needs and top-down leadership, which could negatively impact success.

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 14 OCT 2014  WENDY EVANS
 BUSINESS, BUSINESS SUCCESS, CUSTOMER ENGAGEMENT,
DIGITAL TRANSFORMATION, LEADERSHIP, MARKETING, SALES
 0 COMMENTTransform Digitally or go
Extinct
You might have seen it in the news, the message to business is
clear: transform digitally, or go extinct – and you would be hard
pressed to find an analyst that would disagree. But there is a lot
of confusion over what digital transformation is and how it can be
applied. So to help you understand the basics, we iron out digital
transformation, identify what is driving the change and discuss
how strong leadership can make the process easier.
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2. photo credit (cropped): Matt Callow via photopin cc
What is digital transformation in
business?
Digital transformation is the process of embracing digital
technologies, and it is thought of as the third and final step in
becoming truly “paperless” (digital competence → digital literacy
→ digital transformation). In this final stage the use of digital
technology enables new types of innovation and creativity in a
particular area, rather than simply enhancing or supporting
traditional processes.
From a business perspective digital transformation is the process
of whole scale change that affects every aspect and function of
the business from HR to technology, to communications, sales
and marketing. Businesses around the world are using digital
services such as analytics, the cloud, big data, social media and
“smart” digital technologies as well as improving their use of
existing traditional technologies through intelligent software to
kick start digital transformation. These choices, coupled with
clear strategy, allow businesses to better understand their
customers, to change customer relationships, and adapt internal
processes to changing needs. Below is a graphic from Altimeter
that illustrates some of the key elements of digital
transformation.
Whole-scale change vs constant
innovation
Businesses usually (but not always) only undergo large-scale
digital transformation when they haven’t kept up with changes in
technology or when have fallen behind adapting to the demands
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3. Elements of Digital Transformation: The Wheel of Disruption. photo credit: AltimeterGroup
via photopin cc
of their industry and customers. Digital overhaul doesn’t often
happen by choice because it can be expensive and risky,
especially when it is on a large scale. However, a business that is
constantly innovating and adapting is unlikely to need to undergo
full-scale digital transformation rather small constant changes to
processes and procedures allow for gradual, less risky
transformation.
Who is driving the change?
In many businesses marketing teams are leading digital
transformation as new technology and tools become available. In
addition many transformative initiatives start in customer-facing
functions such as support and customer service. Companies that
embrace these initiatives then become more customer focused
through the use of digital technologies. While the success of
transformative processes relies on co-operation and
collaboration between departments, the changes can also be a
source of conflict between them. For these reasons, successful
digital transformation requires strong leadership from the top.
The importance of a “top down”
approach
Kirill Tatarinov, executive vice-president of Microsoft Business
Solutions, stated that:
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4. When I find great examples of a digital
enterprise it’s the CEO who is the leader and
the driver of digital transformation in almost
every one of those cases.
And, according to Michael Barnes, vice-president and research
director at Forrester:
CEOs must absolutely embrace digital
transformation, and those that don’t risk both
their own jobs and their company’s long­term
success.
They are not wrong. Strong leadership from the top, from those
who embrace digital technologies and are keen to implement
successful digital transformation, is incredibly valuable to the
process and will help a business to be more competitive and
successful long term. Strong leadership also keeps the process of
transformation on track and helps to motivate and inspire those
who are implementing the change.
The state of digital transformation
Despite advantages of top down leadership, a 2014 study by
Altimeter found that this top down leadership was rare. They also
found that where digital transformation was being lead from the
top, it was being driven by the CMO (54%), CEO (42%), and the
CIO (29%).
In 2011, a three-year study conducted by the MIT Centre for
Digital Business and Capgemini Consulting found that only one-
third of companies globally had an effective digital
transformation program in place. In 2014 Altimeter found that
88% of executives and digital strategists stated that their
company is undergoing a formal digital transformation this year.
However, they found that only 25% had mapped out the digital
customer journey and of strategists, 42% had not researched the
customer journey, but were investing in digital technologies
anyway.
So, even though there is a growing trend for digital
transformation, a lack of research into the customer experience
and a deficiency in top down leadership could negatively

5. photo credit: ♥KatB
Photography♥via photopin cc
impact on the success of digital transformation initiatives.
If you would like to know more, you can read Altimeter’s full
report here.
Don’t end up a fossil…
Digital transformation has to start somewhere and the process is
going to be different businesses to business. But what’s
important to remember is that investing in new digital
technologies, such as social media, big data, and the cloud,
doesn’t automatically equate to “digital transformation”.
Transformation is more than that. It is about uniting technologies
around a common set of strategies and supporting these with
modern and integrated infrastructure, while guiding the process
with strong top down leadership, to effectively compete in
global markets.
Over the coming years, digital transformation will lead to
improvements and innovation across everything from marketing
to sales, customer service and beyond. For effective digital
transformation to occur it is time for business leaders to fully
embrace digital transformation and lead their companies into the
competitive markets of the future. Don’t let your business end up
a fossil, embrace digital technologies and transform with strong
leadership and innovative strategy instead!
You might also like
Digital Transformation in
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Further Reading
The 2014 State of Digital Transformation Report – Altimeter

6. Group
Microsoft Urges Leaders to Embrace Digital Transformation – WA
Today
Digital Transformation by any other Name - Jason Bloomberg
Digital Transformation Creating new business models where
digital meets physical – IBM
Digital Transformation – IBM
Digital Transformation – Google Books
About the Author
Wendy Evans is a marketing specialist at
InsightfulCRM with a degree in Media and
over 10 years of experience in business,
educational and marketing roles. An award
winning writer, Wendy also loves to
research and get creative with content and
marketing solutions. When not in the office
you might find Wendy lost in a good book,
studying for her Masters Degree or chasing
Zen at a yoga class. Wendy can also be
found on LinkedIn.
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