It is said that the world’s adoption of everything digital leapfrogged several years due to the Covid-19 pandemic. A hotelier was forced to go out of business during lockdowns before he found fresh air in cloud kitchens and app-based home deliveries. An entrepreneur running an art and music academy almost had to shut shop before he transitioned to the virtual space to reach out to students across the globe. A software engineer in Hong Kong returned home just before the second wave hit India and has been safely working from home ever since. Enterprises got creative with their supply chain, deployed drones and artificial intelligence to keep operations running, and have moved the bulk of their sales online. Doorstep banking is now common and digital payments are booming. Such examples transpired when the COVID-19 pandemic pushed us to the edge in 2020. Digitalization, and the speed at which we adopted it, helped us to rebound.
Though technological innovations, digitization efforts, remote working and online skilling have been a part of the business ecosystem, the impetus they received during the pandemic made them intrinsic to a business’s survival in the new normal.
While digital transformation accelerated rapidly in 2020, it also brought to the forefront a new set of challenges, behaviors and mindset changes. Thus, leaders must identify and mitigate those risks and challenges as we move into the new normal.
Digital makeover of the business landscape
Today, the ever-evolving consumer behavior, as well as enterprise businesses, are propelling digitization as more and more people are getting used to doing digital transactions for financial and other service consumption. Organizations that were already undergoing digitization pre-pandemic, (either by using collaboration technologies, having fool-proof security mechanisms in place, such as multifactor authentication, or by increasing their internet and network capacity), found it easier to move their operations to the digital space, compared to those who lagged in tech adoption.
A McKinsey Global Survey stated that companies accelerated the digitization of their customer and supply-chain interactions and their internal operations by three to four years. Also, the share of digital or digitally-enabled products in their portfolios has fast-tracked by at least seven years. Further, a survey conducted by Fortune magazine and Deloitte found that nearly 77% of CEOs stated that this pandemic has hastened their digital transformation plans. The scaling up or implementation of collaboration tools, touch-free technology, Internet of Things (IoT), data analytics, AI, ML, blockchain, as well as virtualization and cloud computing for enabling scalability and flexibility in IT resources, point towards this fact.
This global health crisis has also given rise to the need for digitization of the entire supply chain networks with automation of factories and operations becoming vital to bridge the human resource deficit gap created due to lockdowns, travel bans and quarantine health safety measures.
The traditional in-office work culture has given way to remote working and hybrid work models as a window into the future of business. Also, employee and customer experience strategies are being redesigned to meet the ever-evolving expectations.
Lastly, the pandemic has driven the need for enhanced cyber security and data privacy measures, including Identity and Access Management (IAM) to ensure that the right resources are accessed by the right people for the right reasons, from anywhere, at any time.
Challenges in digitization
While the pandemic has accelerated the course of the digital journey in an organizational framework, there are various hurdles that business leaders need to address to effectively digitize the various processes and operations.
One of the major challenges that many leaders face is the need for formulating an effective company-wide digital transformation strategy with clearly defined priorities, purpose and resources. They must also ensure that the strategy is in sync with the goals of technology teams.
Digital transformations also create a need for developing an agile, fluid and leaner organizational structure, especially as it is bound to revamp the existing job roles, process, workflow, or even the entire business structure. This calls for a need to reorganize or re-engineer business processes before digitizing them to deliver better business outcomes.
Organizations also need to address the various technological barriers such asbandwidth constraints to provide an effective remote work environment or the rigid, legacy, siloed IT infrastructure that are unable to satisfy the fast-evolving user demands. Even the existing processes that is tech-driven need a substantial upgrade to cope with the pace of adoption of future digital tools. The pandemic has speeded up innovation in technologies and the time to market products is reducing drastically.
Work culture barriers form another area of concern during the digitization process. Leaders are seen dealing with employee pushback to change, especially as process automation, digitization of supply chain networks, adoption of AI, ML, data analytics, etc. can result in turning certain job roles redundant or giving rise to new job roles for which the existing workforce is under-skilled. This requires effective re- and up-skilling initiatives to be undertaken by the organization. The pandemic has adequately demonstrated that plugging human intervention in the global supply chain has been a huge challenge. We simply do not have the tech wherewithal to overcome it.
So, how do we continue to evolve?
Organizations today need to fast embrace digitalization as a business imperative, to ensure that they cater to the consumers’ fast-changing digital needs. They can do this by establishing comprehensive digital transformation strategies, identifying opportunities and roadblocks and innovating constantly to reach out to a wider consumer base across multiple digital channels. The other key strategy is to reduce the time to market your products and shift to the low-code, no-code development environment. Technology is the key driver towards this. Hence, upskilling of current employees would be a critical step towards meeting the end goal. Technology is the tool, but talent is the medium to effectively utilize this tool and offer enhanced consumer experience through digitized products and services.
