By Kathy Kent Toney, President of Kent Business Solutions
Digital transformation…it’s certainly a hot topic these days. We’ve heard more about it since the pandemic started, but I’m sure there are some of us out there that are unclear of what exactly it is.
So, what is it?
To get some answers, I interviewed my strategic partner, Michael Cantu’, an expert on the topic. He’s the founder and CEO of Accelerate, a platform dedicated to digitally transforming businesses. This is our second interview, and I’m excited for the opportunity to share his wisdom with all of you again!
Our topic today is:
How Can Digital Transformation Help My Business?
Kathy: Welcome Michael, glad you could join me!
Michael: Good to be here!
Kathy: First of all, why don’t you to define what digital transformation is.
Michael: Digital transformation is a big topic but it's essentially the adoption of digital processes and technology to replace manual, non-connected processes. It’s building systems that are interconnected that take care of themselves across time.
The end goal is to create better service in companies that better align business objectives for the future.
Kathy: Could you give me some examples of what it is?
Michael: Yes. There are so many, but here are a few:
It could be an accounting process. A company may not be utilizing their accounting system to the fullest extent possible or there may be ways to digitally transform the process that they have today. For example, they may be receiving invoices from their vendors that need to be tracked in a more digital way instead of just via email or by paper mail. So, it may come down to enhancing their existing systems, or if they don't have an accounting system, implementing one of those to take care of some of the accounting issues.
Here's another example...
Every business has some sort of order or bid process that may be manual. Or perhaps it’s all in someone's head and that person has to teach the rest of the people on the team how to perform the work. This could result in bids that are inaccurate and inconsistent. With little-to-no process controls inside of a bid system, these bids could be inaccurate, resulting in lost business, which impacts the bottom line.
A way to digitally transform that could involve a new order or bid system or creating some digital processes around handling approvals within their business. By having these process controls and consistency, a lot of these problems I mentioned go away.
Another example is fulfillment. Once a bid is won, effective customer onboarding and order intake needs to occur. You want to make this process as brief and consistent as possible. For example, if your information collection is inconsistent, this leads to poor customer information, which means downstream you're going to have to contact your customer again to gather information that you could have gotten up front.
You also want to ensure there are predictable process controls so that the system can help you make decisions, instead of people having to remember what steps to take. This improves your quality and increases your margin, because the system is more efficient. This in turn increases your data quality across your company during the fulfillment process.
Another example is customer success, which is at the end of the fulfillment spectrum. How can digitizing processes ensure the quality of output, namely the experience, is consistent?
From a services company perspective, one of my biggest challenges in why I was interested in getting technology involved with the customer success area in the first place. Most of customer success that happens in a business is really tied to someone's ability to understand where a customer is in the process, and conveying that to them, say, when they call in with issues. That also includes a follow-up cadence with the customer during all of these different processes. Technology allows you to implement those controls, from a customer success perspective, into the process. For example, automatically signaling when it’s time to reach out to that customer on a certain matter is certainly a good thing. And what that does is keep your customer informed during the process.
One thing that’s really great about using this technology is this: a lot of new employees, and perhaps more apathetic employees, are not as attuned on how to highly satisfy customers. For perhaps the apathetic ones, it may just be a job to them. That’s one great thing about digital transformation…it can help sidestep potential problems resulting from employees that are not geared towards satisfying customers.
So, having automated customer success mechanisms in place can help make your customer experience solid so they keep coming back for more. In the end, as a business leader you know that if you can retain customers longer, you can keep revenue coming in the door.
The fourth area is document digitization and processing. This gives companies the ability, through an automated process, to have the system extract out all the information from documents instead of somebody manually reading the data and acting upon it. Then that data entry person turns into a verification person. It allows the company to get higher-volume throughput by moving that data entry person to a higher knowledge center. That way they can operate out of a higher part of themselves rather than just reading and copying information. That also improves the quality of the data that's coming in as well, because the system accuracy is very high. Getting the oversight from the data entry person for the revision makes that process a lot simpler as well.
Kathy: Thanks for clarifying that!
As you’ve worked with companies, what has been the driving force to get them started on their transformation journey?
Michael: I’ve seen two pathways:
First, they have a problem and want to solve it. The way they’re doing things is archaic. It may be costing them money or customers. Employees may be complaining about the process. When we come in, we identify what's needed.
Speaking of companies having problems, many are often overwhelmed by these problems to the point that they are often stymied when it comes to innovation. I’ve found through my digital transformation projects that these companies have lots of innovative ideas. Being mired in these problems has often outweighed the ability to implement their ideas. So, when the problems are taken care of first, they are often freed up to start implementing them.
The second pathway is that they don't necessarily have a problem, but they know things could be done better. They know the way they are doing things is not as good as it could be.
Kathy: One of my clients falls into that second category. They are a profitable company, but they want to scale for growth. So, they’re having me map out their processes and then have them automated. They’ve told me flat out they want to build a foundation for their business so they can scale for growth.
Michael: that’s a great example of what I’m talking about!
Kathy: Speaking about making things better, and along the lines of our topic today, “What's in it for me?”, what benefits could a company realize through digital transformation?
Michael: There are many, but I would say the top four are:
1. Increased Efficiency Across Manual Processes
A company may have standalone digital documents or they have paper documents and forms that they're filling out for different items. Or maybe they are sending a multitude of emails back and forth between teams of people. After increasing the digital efficiency, they are experiencing more of an integrated process, bringing awareness to what needs to happen next and accomplishing those things with less human intervention.
2. Reduction in Manual Labor
This translates down to having less failure points by removing areas of human failure. Automated systems bring together correct documentation and tasks so people can do the things they're supposed to be doing, when they’re supposed to be doing it. This replaces multiple people manually making decisions and conveying information, which has more opportunity for potential failure points.
3. Increase in Quality
This doesn’t just involve quality products and/or services…it increases quality in your relationships and customer satisfaction as well.
As we know, people are very good at introducing risk into manual processes, because they forget to double or triple check something. Mistakes that aren’t caught that reach the customer are going to negatively impact that relationship.
On the other hand, a digital process has controls in place that automatically click-in to reduce the occurrence of these mistakes. By tasks taking the same routes, digitally speaking, this removes the risk from your overall process. And when mistakes do occur, they can often be caught upstream. Not only does this improve the quality of relationships with your customers, this also allows you to save on inventory and reduce wasted effort. Ultimately this all combines to ensure that the customer has what they want, when they want it.
4. Increased Transparency
This involves an increased visibility so that the entire team is able to see everything they need to see when they need to see it. A key outcome of this is a reduction in potential process breakdowns. This is a big deal, because not all digital transformation processes allow you to do this… some service providers will just build you a digital form, which is by definition, digital transformation…it is adoption of digital technology to transform a service.
However, these limited types of projects still introduce the need for team members to raise their hand throughout the process to say something’s incorrect. That’s obviously not optimum. You know you don’t have an optimum process if you still have a bunch of emails that are going back and forth. And most people will read through the email strings, what’s happened around something, but there’s always potential to miss something.
So, if you have tasks that are digitally placed right in front of their face and alerts them to that fact…that includes elevating potential issues and escalations to the proper level…then that's a completely different experience, which leads to a better employee and customer experience.
In a nutshell, the best digital transformation projects reduce the risk downside. and that reduction means money. And you don't want to go out there and be spending a lot of money on something that doesn’t do what you want it to do.
Kathy: That really makes sense!
Michael, do you have any closing thoughts for us?
Michael: Yes, there are a couple of things.
First, digital transformation is a consistent effort of seeking betterment within your process. For example, it’s like you’ve gone to the gym consistently and you’ve lost 20 pounds. You don’t quit there. You’ve got to keep going and eating right to keep fit and maintain your weight or lose even more weight.
It's also a mindset that both people, the service provider and the customer, have to be invested in the conversation.
Here’s a good example of what this doesn’t look like. I met with a guy yesterday who was frustrated at their service provider. He called me and told me that his digital transformation project wasn’t panning out very well. He told me it started with a quick sale. It wasn't a consultative conversation. He wasn’t asked the question: “Do you even know where you want to go?” He also wanted his service provider to teach and train him on the system, which didn’t happen.
So, doing a quick fix isn’t always going to be the best route. It’s got to be a partnership between the two that translates into a great experience and end result for both parties.
Along the same lines, going into this it’s best to have a mindset that digital transformation will drive you into the future, because the decisions you make today impact the decisions that you're going to be able to make tomorrow. It's not that the decisions you make today can’t be changed in the future, but they are going to cost you a lot more money. But if you make the correct decisions today, do your due diligence, then options for change in the future are going to be more plentiful and less costly.
Kathy: That makes sense.
That’ll do it for today. Thanks for joining me, Michael!
Michael: my pleasure!
Interested in learning more about what digital transformation can do for your company? Michael and I would love to learn about your challenges and explore some ideas with you.
Click here to schedule a virtual coffee.
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