Current stages of digital transformation in businesses

Digital transformation is becoming a trend recently. However, not all businesses know how to apply digital transformation effectively. In the article below, 1C Vietnam will provide information about the stages of digital transformation as well as the steps to apply digital transformation in businesses.

1. Stages of digital transformation in businesses

Digital Transformation is the process of converting business activities from traditional methods to modern methods. Currently, digital transformation in businesses is divided into 3 stages including including:

1.1. Digitization of information - Digitization

Information digitization is the process of converting information from physical form (papers, records, printed documents) into advanced digital form. The process is performed to optimize data management, making access and sharing easier. On the other hand, digitizing information and data also reduces dependence on paper documents, saves time, and increases efficiency in searching and using information in businesses.

Some notes to pay attention to during this stage include:

• Classify and identify important types of information and data that need to be digitized.
• Be careful when choosing tools and methods for data transformation.
• Conduct data pre-processing to ensure data is complete and accurate. Then, store digital data in an organized manner.

1.2. Digitalization of processes - Digitalization

During the stages of digital transformation , Digitalization focuses on applying digital technology to optimize work processes in the organization. This stage includes the ability to automate process steps and use software and applications to monitor and manage work. Digitizing processes helps increase interaction between departments via online platforms, improving accuracy and process tracking.

1.3. Comprehensive digital transformation - Digital Transformation

The comprehensive digital transformation phase (Digital Transformation) is the process of changing the entire model and method of an enterprise's business operations. This is an important milestone to help businesses make a breakthrough in the digitalization process. Comprehensive digital transformation activities impact most aspects of the business from business strategy, management process, culture to human resources, customers,...

2. Benefits of digital transformation for businesses

Some benefits that digital transformation brings to businesses include:

• Transforming user experience:

Customers appreciate experiencing digital technology. Customer experience (CX) is the new battlefield for businesses, the main driving force for sustainable business growth. Therefore, businesses must transform digitally to bring a more complete and multi-channel experience to consumers.

• Understanding customers:

Through analyzing data from the digital transformation process, businesses will better understand customer needs, thereby devising effective business strategies. By using structured data (customer information) and unstructured data (social media metrics), businesses can significantly increase sales.

• Enhance coordination between departments:

Digital transformation stages create great opportunities for departments to exchange and cooperate with each other. The 4.0 transformation process of a business only happens smoothly and successfully when everyone is working towards a common goal.

• Improve company agility and innovation:

Applying modern technology helps businesses speed up the launch and improvement of new products, while also proposing new, creative business ideas.

• Increase competitiveness for businesses:

The digital transformation process can help businesses create new products and services, thereby expanding the market and increasing their competitive position in the market.

• Optimize business costs:

Digital transformation stages help businesses reduce business costs by automating work processes, avoiding waste and improving supply chain management.

3. Digital transformation steps applied in businesses

3.1. Assess the current status and needs of business digital transformation

During the digital transformation process, the first thing businesses need to do is reassess their current status and needs to choose the appropriate digital transformation strategy and technology. This assessment step is conducted as follows:

• Analyze the impact and external trends of digital transformation:

The company should analyze external factors that may affect its business, including the impact of the business environment, changes in the industry, and competition from old or current competitors. new.

• Identify and prioritize customer desires during the stages of digital transformation”

Companies need to clearly understand the needs of users and other parties such as suppliers, partners, communities and employees. Identifying customer weaknesses and needs will help businesses adjust and improve their products/services to better suit customer tastes.

• Analyze appropriate types of digital technology to help enhance consumer experience:

The company needs to research and find suitable digital technologies to improve the purchasing experience. For example: providing mobile apps, interactive websites, automated customer care services,...

• Analyze current business model:

Conduct research and re-evaluate the business's operating and business methods in stages such as: determining work processes, how to interact with customers, income models, organizational structure,... This helps businesses clearly identify the changes needed to carry out digital transformation and improve operational performance effectively.

• Analyze resources and cultural potential for digital transformation:

This analysis includes the process of evaluating employee capabilities in using new technologies, whether training or support is needed. Additionally, analyzing cultural potential can ensure that the 4.0 transformation will not cause disruptions in an organization's culture.

3.2. Build a strategy suitable for the business

During the digital transformation stages, the strategy building step requires businesses to provide a clear vision and goals, including specific strategies and business goals. This will help companies create a link between digitalization strategy 4.0 and overall business strategy, thereby increasing competitive advantage in the market.

In the process of building a digital transformation strategy, there are 3 questions that businesses need to answer, including:

• How will the industry your business is doing develop in the future?
• How will businesses change and what role will they play in that future?
• How to pave a path forward while maintaining a balance between direction and continuous adaptability ?

3.3. Plan your implementation

Creating a detailed implementation plan for the stages of digital transformation is very important, ensuring the transition process goes smoothly and effectively:

• Identify digital initiatives based on previously set goals: Initiatives should be appropriate to the company's current state. Each initiative should be focused on at least one specific goal to avoid confusion and overlap.
• Prioritize the list of digital initiatives: For each digital initiative, businesses should allocate separate budget and resources. At the same time, businesses also need to conduct a cost/benefit analysis and the importance of goals to determine priorities and allocate appropriate budgets.
• Determine measurement criteria and KPIs: Tracking the progress of initiatives requires determining measurement criteria and accompanying KPI levels. Each KPI should be clearly documented in terms of data sources used, when it was collected, who conducted it, and how the data was analyzed and measured.
• Project planning: Each digital initiative requires a specific plan, defining goals, scope, stakeholders, project timeline and risk forecast. Project management capabilities are essential to maintaining long-term plans.
• Evaluate success: Enterprises need to monitor and evaluate the process of implementing digital transformation to ensure this process is always prioritized by stakeholders. If any problem appears during the digital transformation process, businesses will provide timely solutions.

3.4. Build technology platform, prepare data

At this stage, businesses only need to focus on investing in data infrastructure and advanced technologies, specifically as follows:

• Internal infrastructure: Modern tools help optimize document management, improve work efficiency and minimize costs of recruiting new personnel,...
• Infrastructure when working with customers and partners: Includes technologies that help collect consumer information effectively and respond to customer needs quickly.

3.5. Training digital human resources

In the next step, businesses need to prepare and train appropriate human resources to ensure they have all the conditions to achieve their goals and maintain competitiveness in the market.

Methods to help build an effective digital workforce include:

• Evaluation: Determine whether certain skills and competencies should be developed through internal training or should be recruited externally.
• Internal training: Develop targeted training programs for employees to fill specific skill gaps, enhance leadership capabilities, and promote a culture of continuous learning and development.
• Recruitment strategy: Devise a recruitment strategy that details the specific skills and qualities the business is looking for.
• Integration: Build an effective integration process for both internal and new personnel, helping them quickly integrate into the organization.
• Performance Management: Implement a performance management system to support continuous development for all employees.

3.6. Applying digital transformation to businesses

Implement digital technology transformation according to the above transformation stages, each stage will have different approaches and implementation methods.

Phase 1: Digitizing data

• Independent transformation phase: Use technology solutions focused on improving the business model, enhancing customer experience and maintaining supply chain stability.
• Modern technology solutions for business development: Using modern technology solutions such as e-commerce, multi-channel sales, online communication and marketing, online payment,...
• Accessibility of small and medium-sized enterprises: The 4.0 digitalization trend allows small and medium-sized companies to easily access technology solutions at reasonable fees even without experience in digital transformation.
• Customer experience and meeting change goals: Digital technology transformation goals are closely related to customer experience capabilities. Therefore, businesses need to apply digital technology in changing and managing the supply chain in a more diverse, flexible and sustainable way to meet continuously changing needs.

Phase 2: Digitizing the process

During this phase, the company needs to focus on applying popular digital technologies, linking functions to change the management model and establishing an initial connection with the business model, with the goal of optimization. Maximize operating efficiency, maintain sustainability and achieve growth. Businesses began applying technology to build a comprehensive management reporting system and connect with available background data such as sales, warehouse import and export data and accounting data.

Phase 3: Comprehensive digital transformation

This is a period of comprehensive digital transformation, when the enterprise's business and management systems are integrated and operate based on real-time information. Businesses need to focus on investing in digital initiatives to innovate and create value, while promoting outstanding progress to compete with larger businesses.

4. The secret to success in each stage of digital transformation

In general, digital transformation in businesses today is divided into 3 stages with different levels. Businesses can refer to the following tips to successfully implement the following stages of digital transformation:

• Build a detailed documentation system:

When applying modern technology platforms, businesses need to take a certain amount of time for employees to get acquainted and use them fluently. The best way to help businesses optimize costs, time and human resources when implementing digital transformation is to build a system of specific, detailed instructions on how to use advanced technology platforms. up.

• Create a network-like coordination organization system:

Building a network coordination system is a way for businesses to clearly define the roles, responsibilities and specific tasks of each individual/organization participating in digital transformation activities. From there, businesses can ensure smooth coordination, monitor work progress as well as improve digital transformation efficiency.

• Effective training and development of human resources:

Digital transformation stages require high skills, knowledge and qualifications of each employee to be able to receive and apply new technologies. Therefore, the digital transformation process needs to be carried out in parallel with training and human resource development activities.

• Consulting from experts:

Seeking support from experts is a method chosen by many businesses, helping businesses better understand the techniques, strategies and solutions needed during the digital transformation process. In addition, expert consultation also helps businesses avoid mistakes that other companies have made.

Thus, the above article has summarized the stages of digital transformation as well as related information about digital transformation. During the digital transformation process, businesses should apply professional management software such as 1C:Document Management. This is a digital office solution that helps store documents and manage digital documents centrally, supporting businesses to standardize operations and accelerate growth. Contact 1C Vietnam immediately via hotline to receive more information about this software!