It’s on the tip of everyone’s tongue and backed by a list of emerging technologies that never ceases to grow: Digital transformation. Acronyms like IoT, AI, AR, VR may not mean much to some organisations, but early movers are gaining a serious competitive advantage. And the facts are telling.
Whilst certain industries have been slow to adopt new technologies, businesses around the world have had their hand forced as a consequence of the Coronavirus pandemic. In addition to the obvious benefit of being able to provide services that would otherwise be impossible to achieve, many businesses are harnessing these technologies to increase revenue streams, get a better understanding of their customers, streamline processes, reduce operating costs and improve the overall customer experience.
The industries at both ends of the digital spectrum
A recent McKinsey survey highlighted a significant disparity in levels of adoption between industries. Unsurprisingly, the ‘most digital’ businesses in each sector were far outperforming their peers in terms of growth and productivity.
Whilst the technology sector expectedly came out on top in terms of digital transformation, traditional sectors such as oil and gas, mining and chemicals were also digitalised to an extent, but there was room to develop.
At the other end, construction and agriculture had seen very little in terms of digital advancement – lagging behind most other industry players.
Harvard Business Review cited this to be the reason why labour productivity within the construction sector has remained stagnant since the turn of the millennium, drawing comparison to manufacturing, in which productivity has almost doubled.
Should implementing a digital transformation strategy be at the top of your agenda?
The short answer is ‘yes’.
If there’s one thing that Coronavirus has taught the business world, it’s that those who strive to embrace new technologies can adapt quickly and prevail in ever more challenging circumstances.
In less unpredictable times, new technologies may have been primarily sought by opportunists. But today they’re a necessity to survive. And the benefits of digitally evolving are telling, with those willing to take the leap destined to reap serious rewards. Some include:
Increasing operational efficiency
Automating and streamlining processes via technology is a guaranteed way of reducing workloads and increasing output. Automation can also reduce human error, ensuring quality remains high despite an increase in volume.
Developing new revenue streams
Throughout the pandemic, many organisations have experimented with alternative ways of selling products and services. Smaller businesses have shifted from bricks to clicks. Similarly, established brands have increased and differentiated the channels used to sell online – identifying technologies that enable them to monetise different areas of their business. In turn, this has helped organisations navigate through a difficult financial period. We have, for example, seen a considerable number of organisations register to sell machinery spare parts via our eCommerce platform, Marketplace.
Understanding customers better
Although many organisations will have a huge amount of data in-house already, this isn’t always fully harnessed. But there are ample tools that can give you a thorough overview of your customer data. Questions like who your customers are, what they want, how they see you in comparison to your competitors and how they value their experience with your brand can all be answered. Digitalisation is a great way to come to see your brand through the eyes of your customers – and capture new ones.
Raise supply chain performance
Supply chain management was one of the first operational functions to face a technological makeover. The considerable data generated by ERP systems were utilised by developers to create applications that allowed businesses to streamline transactional activities, bolster warehouse operations and provide much more accurate data for key decision making. Today, by integrating new, more advanced technologies with organisational changes, supply chains are seeing huge improvements in efficiency and endurance, becoming increasingly resilient against potential future shocks.
How to make your digital transformation plan watertight
Align your objectives with business goals
Blockchain isn’t for everyone. Nor is 3D printing or Augmented Reality. Small Businesses may have little use for an ERP system and, given established processes, large businesses may have to consider for longer when identifying core areas of change. Whatever the situation, always have your end goal in mind. If reducing expenditure is a priority for you, consider applications that will allow you to reduce waste, improve supply chain performance, or automate processes. If you need to increase your market share, consider online platforms better suited for certain sectors or territories. This is the easy part.
Set the bar high
Successful digital transformations are 1.5 times more likely to be business-wide in scale, whereas organisations that focus on incremental improvements are far more likely to miss out on more fruitful opportunities, according to McKinsey. So, shoot for the stars.
How Machine Compare can help guide your digital transformation strategy
Machine Compare Marketplace is an e-commerce platform for electrical and mechanical spare parts launched in March 2021. We provide a unique solution for businesses holding unused spare parts, giving them the chance to create entirely new revenue streams by selling these parts to organisations that need them. To date, we’ve identified over $5B worth of these spare parts, ready to be traded in the market.