When it comes to the amount of data around us, the 2020 World Economic Forum reported that as of two years ago, “the number of bytes in the digital universe was 40 times greater than the number of stars.” According to the same report, we saw the number of internet users hit over 4.8 billion worldwide with $1 million spent every minute on commodities online.
And yes, there was that other thing that happened. As consulting firm Korn Ferry writes: “If 2020 and 2021 were years of unplanned reinvention, 2022 is our opportunity to make intentional changes.” I tend to agree with this sentiment.
Current Digital Transformation
The world has been launched into the digital transformation stratosphere. The word unprecedented follows almost every news story, and digital transformation is undergoing massive adoption. Although this is not necessarily new territory for many of us, the urgency to adapt to this changing landscape is.
While the concept of digital transformation has bounced around boardroom tables, meeting rooms and companies throughout the last decade, in all honesty, the concept has been around for ages. Dating back to the 1940s, society continues to evolve by adapting to this type of technological advancement.
However, until now, many companies viewed digital transformation strategies as a way to differentiate themselves or gain a competitive advantage. Thanks to the pandemic, it is no longer an option for businesses. The world is digital, and there is no going back. In fact, according to a PwC survey, “60% of executives say digital transformation is their most critical growth driver in 2022.”
Driving Digital Transformation
Technological improvements and digital transformation are not side effects but driving forces of the market. By 2023, analysts expect investments in digital transformation to reach $2.3 trillion. And this is only the beginning.
Companies are using technology to reinvent their business models, create new areas of market growth and address critical societal needs. In fact, with the exponential growth of digital technology, we can expect industries as diverse as manufacturing, agriculture, health, energy and mobility to be a part of this transformation. Moreover, I see technology playing a significant role in helping solve global issues around climate change, food security, inequality and health.
It is the 21st century, every business should, in fact, already be a digitally powered business. Hence, we are seeing more companies push fast toward this elusive idea. Understanding what it is, however, is key. It must be more than simply implementing a technology stack or inserting buzzwords into presentations. Digital transformation should be a clear strategy that includes “scope and objectives.” It is the process of transforming a business that operates in today’s analog world into one that can survive and thrive in a metaverse world.
Practices In Digital Transformation: The Financial Industry
According to Deloitte, 85% of CEOs that accelerated digital initiatives during the pandemic cannot articulate their overall strategy and progress.
Compare this to the platform and marketplace models adopted by Uber and Amazon. These companies have placed the consumer at the heart of the operation and used technology to enhance the customer experience. No matter the product or service being provided, every step must be easy, fast and personalized.
And while companies like Amazon and Uber are prominent, well-known examples of this kind of pivot and transformation into the digital realm, we can also look to lesser-known stories like that of American Express. No stranger to transformation, American Express made the U.S. Chamber of Commerce’s list of top 10 companies with significant success in reinventing their business model and introducing new revenue streams.
By heeding industry trends, prioritizing process over application and replacing legacy technology with automation, American Express created a client-centric experience and a new way of working. The result? New revenue streams, increased market growth and enhanced customer retention.
More and more, I see this in the fintech space. Next-generation companies are leveraging technology to reach a broader audience. From helping smaller businesses get ahead to providing financial services to the underbanked, we are already reaping the benefits of financial technology. For the first time, financial services are reaching consumers, regardless of income, to help them save, invest and build credit.
For instance, the Danske Bank provides an excellent example of the value derived from a digital-first ecosystem. In 2013, Danske Bank launched MobilePay, a peer-to-peer (P2P) app. This app was available to any consumer at no cost and delivered free, user-friendly solutions. In addition to this, it provided an easy, seamless payment solution for businesses. The customers benefitted, but also, by deploying this technology, the bank introduced a new revenue stream that currently sits at $23.1 million.
The Future State
I expect many more sectors and organizations to follow suit as digital transformation accelerates across industries. From 5G and quantum computing to AI and blockchain, I see how advances in this type of technology will only speed up toward a net positive impact on our way of life. We will soon see job creation, novel ways of working and innovative business models. Embracing these technologies and digital advances will allow us to capture opportunities not yet imagined.
In a post-pandemic world, a company’s successful future relies heavily on leaders who act proactively on trends and embed innovations deep into the day-to-day operations and throughout the entire company’s culture. Equally important is taking the time to learn from those who have done it well and those who haven’t. A point often overlooked is to investigate solutions with a demonstrated capability to extend beyond the needs of today. By far the most important factor is to put the customer first and go from there.
With each incremental movement forward, we endow companies with capabilities enhanced by technology to create a digitally transformed future focused on creating a better world for all. Our capacity and potential to drive positive social change have never been higher.
About VoPay: Some of the brightest minds team up to empower businesses through leading-edge payment technology; VoPay puts digital transformation first. At VoPay, we believe in Digital Finance for all, and every person or business, regardless of their technical capability or location, needs to transact. We make that happen. Learn more.
How Digital Transformation Can Change Our Business World For The Better was originally published on Forbes on June 1, 2022.