Abstract
This chapter aims to clarify all mysteries about the term digital transformation. First, the focus will be understanding more about what is digital and what is transformational. The chapter will provide guidance on why we need digital transformation at all. What will be the penalties if the organizations try to pass? There are five key domains which will be covered: customers, competition, data, innovation, and value. After the domain, the chapter will introduce the six stages of digital transformation: business as usual, present and active, formalized, strategic, converged, and innovative and adaptive. Key topics that will be explained are the difference between digitization, process digitalization, and digital transformation. Finally, the chapter will end with more details on how to lead and embed the digital transformation in the organization.
TopBackground
Value
As mentioned above every Digital Transformation should be about improving the value delivered to the customers. So, let’s first clarify what is Value? We will use the definition in ITIL4 as per (Axelos.com, 2022), where value refers to “The perceived benefits, usefulness, and importance of something”.
The term Value is key especially when delivering services because it is the consumer who perceives the benefits created by the service delivery and defines the usefulness and the importance, thus defining the value itself. This means that value is subjective and is not defined as one-time off exercise by the provider, but by each customer on each interaction. Some customers might find certain outputs very useful, where another group of customers can be indifferent to those.
Having this definition, once a Digital Transformation starts there must be a mechanism set to measure is the value delivered being improved or not. This can be done in many ways: direct contact with customers, surveys, focus groups etc.
Key Terms in this Chapter
Vision: A clearly defined point in the future of the organization that is both achievable and desirable.
Transformation: This is the movement from one defined state to another by making significant improvement in the value delivery. Focus is to provide more value to clients by improving the organization.
Transition: This is the movement from one defined state to another without making any significant improvement of the value delivered to clients. Focus is mostly on efficiency and effectiveness gains.
Digitization: The exchange of non-digital items with their digital analogues.
Digital Transformation: Significant technology and organizational change of state which is supplemented by latest technology achievements and digital savvy leadership.
Digital: The day-to-day and a cultural change implied by technology.
Value: The perceived improvement in one’s life or work efforts due to a service consumption.