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The Essential Components of Digital Transformation

• Tomas Chamorro-Premuzic

It’s about so much more than your technology.

It’s problematic when companies decide to embark on a digital transformation agenda without having a clear definition, let alone vision, for what it means. The fundamental meaning of transformation is not about replacing old technologies with new ones, or capturing high volumes of data, or hiring an army of data scientists, or trying to copy some of the things Google or Amazon do. In fact, the essence of digital transformation is to become a data-driven organization, ensuring that key decisions, actions, and processes are strongly influenced by data-driven insights, rather than by human intuition. In other words, you will only transform when you have managed to change how people behave, and how things are done in your organization.

The digital revolution forced every organization to reinvent itself, or at least rethink how it goes about doing business. Most large companies have invested substantial cash in what is generally labelled “digital transformation.” While those investments are projected to top $6.8 trillion by 2023, they’re often made without seeing clear benefits or ROI. Although these failures have multiple causes, they are generally the result of underestimating the various steps or stages required to successfully execute a transformation agenda.

• Tomas Chamorro-Premuzic is the Chief Innovation Officer at ManpowerGroup, a professor of business psychology at University College London and at Columbia University, co-founder of  deepersignals.com , and an associate at Harvard’s Entrepreneurial Finance Lab. He is the author of  Why Do So Many Incompetent Men Become Leaders? (and How to Fix It ) , upon which his  TEDx talk  was based. His latest book is I, Human: AI, Automation, and the Quest to Reclaim What Makes Us Unique.   Find him at  www.drtomas.com . drtcp

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What Is Digital Transformation? Definition, Strategy, and Examples

Learn how digital transformation in an organization can deliver value to customers.

The term digital transformation can apply to anything changing from analog to digital. On a global scale, it is the sum of ongoing changes in the digital age. The following article explores digital transformation strategy, processes, benefits, and examples. 

What is digital transformation?

Digital transformation is the process of integrating digital technologies into all parts of an organization, such as products, services, or operations, to deliver value to customers. In a globally and digitally connected landscape, this type of transformation is more than keeping up with the rest of the world and your industry—it’s about continuing to innovate and seek new, better ways of doing things.

Digital transformation examples

An example of digital transformation that you are likely familiar with is paper records at doctor's offices. Today, most medical documents are digitized into electronic health records (EHR). This digital transformation process made it easier for patients and providers to access records quickly. It also enhanced scheduling and monitoring capabilities beyond paper and pen. You can familiarize yourself with examples of digital transformation across different industries in the following sections. 

Digital transformation in health care

As mentioned above, the shift from paper-based patient records to EHR has made monitoring health concerns easier for patients and providers. Online portals have also helped make virtual doctor’s visits more accessible in recent years. For example, the company Doxy.me created a free web-based system designed for telehealth. Clinicians can create an account and offer a personalized waiting room to communicate with patients. Patients can click a link to “wait” in the room until the clinician is ready. This service provides an easily accessible, secure, and safe virtual platform for telehealth.

Learn more: Check out Northeastern University's Master of Science in Management: Digital Transformation in Healthcare .

Digital transformation in entertainment services

Netflix started out as a DVD distributor and then pivoted into a streaming service. It was a bold (but smart) move. Blockbuster stores were dying out, and people were spending more and more time online. Later on, competitors like Hulu, Disney+, HBO Max, and Amazon Prime would enter the market for a slice of the streaming service pie.

Digital transformation in finance

Financial services have undergone a significant transformation in recent years, enabling several forms of mobile banking. Consider the transformation from cash to credit cards and automated teller machines (ATMs). Or, think about how touch-free payments such as Apple Pay and CashApp have proliferated. Another notable example is Wise (formerly Transferwise). This company created a borderless banking application that allows businesses and individuals to send and receive money in multiple currencies.

Wise's digital transformation strategy

Rather than being divided into departments (like marketing, finance, etc.), Wise implemented small, autonomous teams to focus on specific key performance indicators (KPIs). Additionally, they cultivated a mission-driven culture to encourage innovation with speed and agility.

Learn more: Check out Copenhagen Business School’s Digital Transformation in Financial Services Specialization .

Digital transformation in manufacturing

Many manufacturers undergo digital transformation to create more lean, efficient supply chains. Using predictive analytics and other forms of artificial intelligence (AI), they reduce costs, maintenance, and consumption. For example, Tesla is known for being a manufacturer of electric cars. It is the only car manufacturer that provides updates that allow the car to improve safety and performance capabilities remotely. It has also worked to produce more lithium-ion batteries at its manufacturing plants, using digital technologies to increase year-over-year growth [ 1 ].

The digital transformation process in 4 phases

Digital transformation efforts look different from industry to industry. The process can vary slightly depending on customer expectations, business models, and organizational culture. However, the overall digital transformation process can be broken down into four phases:

1. Early stage. The first stage of the process includes planning, cultivating the necessary partnerships, and testing the organization's capabilities. Business leaders develop the approach and select the tools or digital innovations they want to implement. 

2. Mid-stage. During this stage, business leaders choose focus areas like business processes, digital products, or key roles within the organization. The digital transformation strategy is defined, along with key performance indicators (KPIs) that help measure success. 

3. Growth stage. The growth stage in a digital transformation project emphasizes scalability. It focuses on adopting new business processes, products, and protocols across the organization. Change management is introduced during the third stage of the transformation process. 

4. Mature stage. The final stage in a digital business transformation is centered around continued innovation and improvement. A strategic approach to governance should also be defined during the mature stage.  

Even in organizations where a digital transformation initiative has been “completed,” continuous maintenance and re-evaluation are required.

What is a digital transformation strategy?

A digital transformation strategy is the holistic approach an organization coordinates. The goal is to make the digital transformation journey seamless and efficient. Beyond implementing new technologies to support your employees and customers better, true transformation requires a company culture that is open to embracing change, experimentation, and failure. The success of digital transformation in an organization relies on openness to innovation and flexibility.

Digital transformation services

Some organizations employ the help of digital transformation services to ensure a smooth employee experience and minimize disruptions in daily operations. Commonly utilized digital transformation services include:

Consulting. Experts can analyze your company's IT infrastructure and operating model to make strategic recommendations. Goals include enhanced performance, scalability, and sustainability. 

Big data management. Digital transformation services may include the implementation of big data infrastructure. Structuring how an organization collects, stores, and analyzes data can provide essential insights to guide decision-making. 

Re-engineering of existing infrastructure and digital products. Many organizations seek expert guidance in modernizing legacy systems and outdated processes for optimal digital transformation success.  

Digital transformation careers

When an organization undergoes a digital transformation initiative, every team is affected. The sections below outline some of the key roles that affect digital transformation efforts.

Engineers and developers

Software engineers , user experience ( UX) designers , developers , cloud computing specialists , and product managers are essential roles in the rollout of new products, services, systems, and processes. They work alongside operations staff to implement software at every stage of the business.

Data science and IT professionals

Data scientists , data architects , and data analysts sort, analyze, and produce insights. Machine learning and AI engineers support digital transformations by creating models for quicker, targeted analysis of data to assess needs. Other IT jobs include systems administrators and help desk technicians , who troubleshoot and assist before, during, and after big operational changes.

Strategists and creatives

Strategists, such as change management and digital transformation consultants (or agencies), can provide much-needed support for leadership at a high level. They can help facilitate the company-wide adoption of tools and technologies. Additional job roles needed for internal communications during a digital transformation include content and brand strategists and ethical compliance specialists. 

Digital leaders

At the top of the organization, Chief Information Officers (CIOs) must work with other executive staff to ensure a smooth transition and continued revenue growth by introducing new digital products and technologies.

Interested in starting a career in digital transformation? Consider learning from an industry leader with the Google Data Analytics Professional Certificate .

Benefits of digital transformation

Digital transformation has plenty of benefits in addition to keeping pace with organizations at the forefront of the digital revolution:

Increased return on investment (ROI): Organizations that spend money on and complete their digital transformations tend to see margins that are 16 percent higher than their industry average, according to MIT Center for Information Systems Research [ 2 ]. While this number may vary, it’s hard to deny that implementing digital systems and processes can speed up productivity and operations to increase business growth.

Data-driven insights: Digital tools help organizations collect, sort, and analyze data at huge volumes. Across an organization, departments can translate raw data into actionable insights to optimize operations, production, finance, and marketing. Business intelligence tools help leaders make data-driven decisions.

Improved communication and collaboration: Teams can benefit from enhanced productivity by using digital tools that facilitate better communication and collaboration. Whether it’s Microsoft Teams or Slack, email platforms like Outlook or Gmail, or collaborative tools like Google Docs and Miro, there are numerous options for digital collaboration.

Better customer experience: Creating more intuitive and seamless experiences for customers begins with adopting digital technology. When reaching customers through email marketing and social media , businesses can track metrics with digital tools. A digital infrastructure can help an organization cater to different customer segments to deliver value propositions like fast delivery, competitive pricing, and good quality. As a result, customers will be more likely to choose that company’s product, even among competitive choices.

Read more: Digital Supply Chains: Definition, Benefits, and Careers

How to start your digital transformation journey

Digital transformation projects start with adopting a culture of change. First, you’ll want to consider your business goals. What are the needs? How can you be human-centered? What can be done more efficiently with technology? Then, collaborate with and empower IT staff to research the best tools for your needs. You’ll want to align this strategy with the right technology. Finally, redesign your business to focus on your customers and employees, whether it’s elevating your products, distribution channels, human resources, or financial organization.

Keep learning about digital transformation with Coursera 

Whether your organization is launching a digital transformation initiative or you're interested in starting a career in this field, you can prepare yourself with an online, self-paced, and beginner-friendly course developed by the Darden School of Business at the University of Virginia. You'll learn how to apply the Boston Consulting Group’s framework to navigate digital transformation strategy, core processes, and technology.

Article sources

SSRN. “ Tesla Motors, Inc.: Driving Digital Transformation and the Digital Ecosystem , https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3053142.” Accessed April 19, 2023.

GHD. “ Realising the value of digital transformation , https://www.ghd.com/en/perspectives/realising-the-value-of-digital-transformation.aspx.” Accessed May 15, 2023.

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Internet matters: Essays in digital transformation

This compendium is organized around a collection of essays by experts from the McKinsey Global Institute, McKinsey’s High Tech Practice, and McKinsey’s Business Technology Office that tackle the theme of digital transformation as part of our continuing major research program on the economic impact of information technology. This volume also explores how Web standards are evolving, how the Internet is infiltrating all enterprises, and how the Internet is creating new playing fields with “Big Data”, “nowcasting”, and innovative models of competitive intelligence.

The essays are organized into four sections. The first section— The Internet at scale —drills into how Internet technologies at large (that is, the Web, social technologies, cloud computing, etc.) enhance competitive stance, translating into significant macro-economic performance in both mature and developing economies. The essays also consider how those companies that are morphing their organizations to networked-based structures are reaping the largest benefits of this Internet revolution.

The second section— The “Big Data” revolution —looks at how the flurry of data materializing from digitization creates major economic surplus, on top of Internet technologies. This data, provided it is used wisely and with the consent of its “owners”, can be used to build new and real time competitive insights. It has also inspired the creation of new sciences, such as nowcasting.

The third section— Impact on TMT —translates all of the above into case studies from the telecom, media, and high-tech industries. The last section— Outside voices —features interviews with Internet leaders that were originally published in The McKinsey Quarterly .

Expert interviews include: Google's executive chairman, Eric Schmidt; visiting researcher with the Intelligent System Lab at the Palo Alto Research Center, Brian Arthur; MIT professor, Erik Brynolfsson; Cloudera co-founder, Jeff Hammerbacher; Butler University basketball coach, Brad Stevens; and Proctor & Gamble CEO, Robert MacDonald.

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​What is digital transformation? Everything you need to know about how technology is changing business

What is digital transformation?

At the most basic level, digital transformation involves using digital technologies to change a business process to become more efficient or effective. The idea is to use technology not just to replicate an existing service in a digital form, but to use technology to transform that service into something significantly better.

It sounds simple but digital transformation can be a long, expensive and complicated process that doesn't always go according to plan.

Special Feature

Digital transformation: trends and insights for success.

Digital transformation projects are about driving fundamental change across customer experience, tech and business culture. This ZDNet special report brings you the latest trends and insights you need to succeed.

What are the key areas of digital transformation?

Every definition of digital transformation is different, depending on the industry and the particular project. But the main components will likely include rethinking business models, changing the underlying technology stack, innovating with customer experience and also potentially even remaking company culture.

What does digital transformation involve?

Digital transformation can involve many different technologies, but the hottest topics right now are  cloud computing , the  Internet of Things , big data, and  artificial intelligence . During the next few years, we can expect increased attention on some hyped-up tech topics, including the metaverse, and blockchain and digital currencies.

However, it's not just about the technology: changing business processes and corporate culture are just as vital to the success of these initiatives. Digital transformation projects are often a way for large and established organisations to compete with nimbler, digital-only rivals. These projects tend to be large in scope and ambition but are not without risks.

While digital transformation is one of the most commonly used phrases in the IT industry, definitions vary. What everyone can agree on is that, beneath the hype, the fluff and the confusion, digital transformation involves some pretty important changes to business culture.

What is included in a digital transformation project?

Digitalisation is not, as is commonly suggested, simply the implementation of more technology systems and services. A genuine digital transformation project involves fundamentally rethinking business models and processes, rather than tinkering with or enhancing traditional methods. 

This creative requirement remains a tough ask for business leaders. Most organisations do not have a problem generating new ideas, but  many firms fail when it comes to implementing fresh business models  or turning good ideas into organisational objectives, according to research from Cass Business School.

This gap between innovation and execution helps explain why digitalisation and disruption have traditionally been seen as the preserve of nimble start-ups. But it doesn't have to be this way – there are great examples of digital transformation in the enterprise sector, too. 

Digital transformation examples 

The transition of legacy systems to cloud platforms is an oft-cited example of digital transformation. By moving older systems to the cloud, it becomes easier for organisations to update and change applications in response to new user demands. In this case, digital transformation is helping to support nimble and flexible IT operations – it is, in short, making an existing process much more efficient and effective.

Using technology to change or remove an inefficient working process is another good example of digital transformation. Think, for example, of the digitisation of paper records. By using technology to transform how an organisation records its information, it becomes possible to search digital records and run reports in a way that would have been unthinkable or at least unmanageable in an era of paper records. 

While digital transformation often involves using cloud-based platforms and services, it can also involve the adoption of emerging technologies. We can expect to hear more about these kinds of use cases as the metaverse moves from the lab to the real world. Such is the level of hype that  40% more companies mentioned 'metaverse'  in their company filing documents during the first quarter of 2022, according to researcher GlobalData.

Some progress is already being made. Think of a retailer allowing customers to use virtual reality apps to visualise its furniture from the comfort of their home. In this case, digitisation transforms the traditional physical retail interaction into a virtual relationship, where customers can try and then buy products at a distance. 

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How important is digital transformation?

For those who weren't convinced about the positive benefits of digital transformation, the power of digitisation won over many doubters during the coronavirus pandemic. 

When lockdown and social distancing started, it was digital transformation – and the IT departments that carried out the work – that helped businesses carry on functioning as normally as possible in the most challenging of conditions. IT teams had to spin up technology solutions to the challenges that businesses faced overnight.

Digital transformation strategies were fast-forwarded at breakneck speed. Executive teams that might once have hesitated over the implementation of a multi-year investment in video-conferencing and collaborative technologies tasked their IT departments with establishing remote-working strategies in days or even hours. 

CIOs and their IT teams stepped up and delivered – from the support of home working to the provision of online learning and onto the establishment of new online e-commerce channels and even the creation of whole new business models:

• Proven infrastructure, new laptops and re-imaged older kit helped one city  get its office staff remote working in super-fast time .
• This university  fast-forwarded a five-year digital transformation strategy  and got 22,000 people working remotely in a week.
• The R&A, organisers of The Open golf tournament made innovative use of video and data to create  a virtual tournament between golf's all-time best players .

The general consensus from experts around the tech industry is that the rapid digital transformation pushed by CIOs and their teams  helped change the perception of IT for good . Rather than being seen primarily as a service to other functions, such as sales and finance, technology is now recognised as a critical factor for long-term business success.

What digital transformation trends are happening now?

With digital transformation proving its worth in challenging times, the aim now is for organisations to find new technology projects to get their teeth stuck into.

Analyst Gartner says  CEOs know they must accelerate the adoption of digital business  and are seeking more direct digital routes to connect with their customers. But with an eye on economic risks, bosses want to be efficient and protect margins and cash flow. Current digital transformation trends include:

• Cloud computing – On-demand IT has been the centre of digital transformation efforts for the past couple of years but that doesn't mean the work is done. While many organisations aim for a cloud-first approach, few have moved their systems 100% to the cloud. Legacy tech remains a major hindrance to modernisation.
• Data and AI – Companies have spent the past few years collecting huge amounts of information. The task now is to break down silos, to bring data together and to apply insight in ways that improve customer experiences and decision-making processes. Expect investment in artificial intelligence and machine learning to grow significantly. 
• Automation – Executives are finally beginning to see investments in robotic process automation pay dividends. Whether it's reducing software-coding demands or introducing bots to deal with service requests, companies will use automation to remove repetitive tasks and allow staff to focus on work that produces value.
• Customer experiences – From allowing professionals to work productively from home to providing new ways to help clients connect with the business, companies are going to spend big on developing great experiences for customers. Expect investments in the metaverse to become important here, too.
• Cybersecurity – Underlying all these digital transformation efforts is a continued requirement to invest in IT defence mechanisms. Gartner points to the rise of the cybersecurity mesh, which enables stand-alone security solutions to work together and improve an organisation's overall security posture. 

What are the criticisms of digital transformation?

While most experts can agree that digitisation involves using technology to make a process more efficient or effective, just about every project that involves using technology gets badged as a digital transformation initiative.

Digital transformation has become the go-to marketing phrase for almost any adoption of new technology. In fact, the phrase is applied so broadly that it is in danger of becoming meaningless. Such is its ubiquity that it's no surprise when an attention-craving organisation badges its new app or even something as mundane as a laptop refresh programme as a 'digital transformation initiative'.

Tech workers also express cynicism about grand talk of digital. No IT professional spends their working day digitally transforming rather than coding, programming, and developing. For their part, CIOs will tell you the implementation of technology is simply the conduit to help the business meet its objectives, whether that's selling more widgets, making more money or raising customer satisfaction levels.

To critics, digital transformation simply offers tech vendors another opportunity to rebrand their offerings: it's not uncommon to see systems and services being sold as a golden bullet for digital transformation. Such hype is just more fuel for detractors who feel that digital transformation is simply a solution searching for a problem.

None of this criticism should come as a shock. Even back in 2017, analyst Gartner warned that over-selling meant  digital transformation was fast-approaching the trough of disillusionment . Five years later and critics would say we're now at the bottom of that trough.

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What else could we call digital transformation?

One way to help silence the critics would be to find another name for digital transformation. If we stop using the term blindly, and instead focus on what we're trying to achieve with technology, then we might find a more useful moniker.

That's something that resonates with the CIO community: almost every IT chief will tell you that their organisation is running business transformation, not technology transformation, projects. Other industry commentators suggest culling the phrase digital transformation and creating a slightly modified alternative, such as 'digital landscape', 'underlying digital environment' or 'data-led plumbing'. 

The big problem with all these alternative names is that they mean even less than digital transformation. For all its inherent faults, we all have a perception of what digital transformation means, even if it's just relying a lot more on the cloud and pushing technology into areas that were previously dominated by manual means.

Yes, the concept of digital transformation has its flaws, but – in some ways – the IT industry should just be pleased that the business has begun to recognise the great work that the technology team is undertaking, regardless of what it's called. 

Remember that the rest of the business tends to have a problem with big IT concepts. Take the example of the phrase 'cloud computing', which used to be met with nonplussed expressions from non-IT execs 10-plus years ago. Now, the cloud is a broadly understood and accepted term. 

Cloud found its footing by proving its value – and so it is with digital transformation. The business has seen the value of digital transformation in recent years and now it wants a whole lot more in the future.

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Why does digital transformation matter?

Beneath the buzzwords, there lies a crucial concept: digitalisation is helping smart businesses to change the established economic order – and the effects are everywhere. 

From Amazon's influence over retailing to Facebook's impact on publishing and onto fleet-of-foot FinTechs that are destabilising banking and insurance operations, traditional firms are being challenged by nimble, digital-savvy operators. 

Consultant McKinsey reports that  many executives believe their companies' business models are becoming obsolete . Only 11% believe their current business models will be economically viable through 2023, while another 64% say their companies need to build new digital businesses to help them get there.

It's also important to recognise that digital transformation is more than simply an IT concern. Line-of-business units are crucial to identifying where digitisation can create big benefits. As the Harvard Business review suggests, without a more fundamental business transformation,  digitisation on its own is a road to nowhere .

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Can you give me an example of what digital transformation looks like?

Beauty company Avon International has used a direct-selling model for 130 years. The company normally sells its products through reps who call at clients' doors and collect orders from a paper brochure. But that model was all-but-impossible to continue during the coronavirus crisis and lockdown. 

The solution to this challenge came in  the form of a rapid digital transformation  that allowed reps to carry on selling. The IT team focused first on putting in place a mechanism that allowed reps to ensure that the orders they were taking – through WhatsApp, a text message, an email, or a phone call – were delivered directly to Avon's customers rather than by hand.

As the company had 60 different enterprise resource planning systems around the world and more than 200 back-office systems, changing the delivery address meant modifying a range of ordering and invoicing processes. The team implemented that new approach on top of its legacy platforms in 30 markets in just six weeks.

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Avon also started to develop a stronger e-commerce platform, such as via mobile and web. Sales through e-commerce channels grew by six times in the first three weeks following lockdown. The company also started to produce digital brochures that could be updated far more easily and shared through social channels. 

Today, 30% of the company's sales contacts are made online in the UK, up from less than 10% before the pandemic. By finding ways to maintain sales and beef-up its e-commerce channels, Avon kept its customers served and its reps busy, gaining new clients along the way. 

In short, digital transformation has helped to change the company's business model – and that's going to last forever. Chief executive Angela Cretu has said  the company wants to become fully "omni-channel" , linking different methods of selling from stores to the doorstep, over the next few years.

How much does digital transformation cost?

Global spending on the digital transformation of business practices and products  will reach $1.8 trillion in 2022 , an increase of 17.6% over 2021, says tech analyst IDC. The researcher expects a five-year annual growth rate through 2025 of 16.6%

"As organisations accelerate their pursuit of a digital-first strategy, they are channelling these investments into both internal operations and external direct engagement," says  Craig Simpson , senior research manager at IDC. "The investments in internal operations are largely focused on improving efficiency and resilience while customer experience transformation has become a digital transformation priority for many companies."

Gartner also reports that tech spending will increase across the board for most IT organisations through 2022 and beyond. The analyst projects  global IT spending will total $4.4 trillion in 2022 , an increase of 4% from 2021. 

Something to note, though: digitisation is far from easy. The  average enterprise has more than 200 technology solutions  in its tech stack across the organisation, according to Futurum Research. The advisory firm's analysis suggests the vast majority of digital transformation initiatives don't consider the user and ultimately result in inefficient adoption. 

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How long does digital transformation take?

Digital transformation projects have traditionally been associated with multi-year strategies. Here, CIOs have worked with their peers to think about how technology might help their organisations react to the threat of digital disruption. They've then created a long-term business strategy that uses technology to help the organisation meets its aims.

The problem with many of those long-term strategies is that they've taken too long to come to fruition. Incumbents might be good at creating spot digitisation projects, such as moving systems to the cloud or creating new digital channels to market, but they're much slower when it comes to transforming the whole business to support new operating models.

In an age where fleet-of-foot digital challengers can move into a new sector almost overnight, then multi-year strategies are simply too slow. The multiple challenges associated to dealing with a global pandemic, new geopolitical tensions and macro-economic pressures have shown that flexibility and agility are the watchwords for modern digital strategies. 

McKinsey reflects on the fact that most  companies' adoption of digital technologies sped up by three to seven years in a span of months  during the pandemic. That increase in pace is having a lasting impact. The consultant says what was considered best-in-class speed for business change four or five years ago is now seen as slower than average. 

This need for speed has an impact on digital transformation strategies. Instead of talking about five-year plans, boards demand constant iteration. For many organisations, that shift has required a new Agile way of working.

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What's the relationship between Agile and digital transformation? 

Digital transformation is  as much about establishing the right cultural change programme  as it is about introducing new tech. Digitisation needs organisations to work out quickly what their business needs and how they're going to get there. For many managers, the best way to find these answers is by adopting Agile methods.

Agile management  has its origins in software development , but as Harvard Business Review suggests, it has spread far  beyond its product development and manufacturing roots . While Agile won't be applied the same way in every organisation, the basic principles – decentralised decision making, cross-organisation teams and cross-team empowerment – are likely to resonate with most business leaders.

Experienced digital leaders suggest the big benefit of an Agile approach is cultural. By working in small, cross-organisation groups to explore challenges and deliver solutions, IT staff and line-of-business professionals can iterate around a problem and apply digital systems and services quickly. 

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How is digital transformation supporting the shift to hybrid working?

Companies have already invested a lot of cash in cloud and collaboration technologies. These services will prove crucial in the coming years, as organisations attempt to find ways to support a hybrid mix of at-home and in-office knowledge workers.

Evidence so far suggests that managing this shift is from easy. While many professionals have now got used to working from home – and  research suggests they're more productive, too  – their bosses are not always quite as keen to see them detached from the corporate HQ. Finding a successful middle ground between home and office working will be crucial.

Managers will need to continue investing their digital transformation cash in technologies to help create the hybrid workplace of the future. Worldwide spending on public cloud services is  forecast to grow 20.4% in 2022 to total $494.7 billion , up from $410.9 billion in 2021, according to Gartner.

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Who is in charge of digital transformation?

As the traditional guardians of technology investment, CIOs tend to have a big say in digital change projects. Yet CIOs are far from the only executives with a role in digital transformation management, and the pressure for change has led to the rise of other C-suite specialists, such as chief digital officers (CDOs).

Analyst firms fanned the flames by suggesting the appointment of CDOs could hasten the demise of the traditional IT leadership role.  Gartner originally claimed  a quarter of businesses would have a digital chief by 2015, and  IDC said  60% of CIOs would be replaced by CDOs by 2020. Today, those predictions look way off beam. 

What no one can deny, however, is the ever-increasing role of business professionals in IT purchasing decisions. Rather than the IT department going off and buying systems that it thinks their organisation needs, modern business operations rely on all kinds of people identifying their key challenges and then thinking about – or even going out and buying – technological solutions to these problems.

Cloud computing makes it far easier for professionals in any department to buy IT services on-demand. When requirements change, professionals can scale these services up or down depending on demand – with or without the say-so of the tech team.

Yet the game is far from up for CIOs when it comes to digital transformation. While line-of-business employees are good at buying discrete digital technologies, CIOs have the experience of integrating systems and services. Effective digital transformation usually requires a close working relationship between CIOs and their line-of-business colleagues. 

With companies now looking to get more from recent digital transformation projects, even greater focus will be placed on the tech leadership capabilities of CIOs – and that means building even stronger bonds with the chief executive and the rest of the C-suite.

As Boots UK CIO Richard Corbridge says, tech chiefs need to think very carefully about what they do next: "For me, that's about being a transformation agent – it's about being the person stood next to the executive committee, taking the things that we must do to transform this business and translating that into what digital can do to help us get there quicker, more efficiently, safer, or to help us make more money."

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When does digital transformation stop?

It doesn't. Many people make the mistake of thinking of digital transformation as a discrete project. As Forrester suggests,  true transformation is a journey, not a destination . Digital transformation remains a slippery concept that involves the delivery of value to the business and its customers in new – and perhaps unexpected – ways.

Just as digital transformation constantly changes, so do its constituent elements. Right now, most business transformation activities involve the innovative use of data, whether that involves analytics, IoT, artificial intelligence or machine learning. In many ways, as digital transformation has evolved it has become more about data-led change than anything else.

So the form of digital transformation continues to evolve, meaning the process of defining digitalisation remains complex and contested. The one thing we can be sure of is that transformation – in whatever form it takes – is here to stay, which means IT professionals and their business peers must build a sustainable strategy for change.

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The Digital Workplace Transformation Issues Essay

Introduction, main implementation challenges, main struggles in digital transformation, the productivity issue, people-focused approach, the positive impact of digitalization, reflection questions.

For the last couple of decades, the process of implementing new resource-intensive strategies has been drastically fastened and improved. In this research, it is important to emphasize the significance of the digitalization of the present workspace and all the consequences, challenges, and obstacles that are associated with them. Thus, the question of the given research should be: how will digital modernization affect current workplace relations, and what are the methods to minimize any negative repercussions? Indeed, the reformation through electronic devices and the Internet is inevitable and, in my opinion, highly effective despite possible difficulties. However, in my opinion, there are different disadvantages that are rooted in constant modernization of the workplace. Therefore, the aim of the paper is to determine the main problems of digital transformation and ways to solve them.

Although digital workplace transformation has shown a great variety of positive changes, modern professional conditions still present considerable challenges in adjusting modernization in people’s lives. It depends on a place or a region whether its community is ready to provide digital technology with the right quality and quantity of resources. The IT infrastructure has to be thoroughly designed specifically for the sphere in the particular workspace (Attaran et al., 2019). Further, unfortunately, a lot of professional communities do not have enough funds to provide an ideal way of implementing safe and efficient integration of current digital trends. However, digital environments are quite low maintenance, and usually, they tale much fewer assets than the traditional office jobs, so well-adjusted employers can actually save money by implementing digital resource-intensive strategies. Thus, it is essential for the companies to keep being relevant by using cross-functional delivery teams to put their technological equipment on another level.

Despite the most visible advantages of implementing healthy digital relations, such an approach is not always ideal for the employees and their employers if there are some mistakes in using modernization strategies. For instance, due to recent studies, workers are more likely to face an information overload and get overwhelmed easily because of constant online mail processing (Colbert et al., 2016). Colleagues have to deal with a rather big amount of computerized data in comparison to the smaller quantity of information in traditional environments (Sivunen et al., 2019). Excessive work demands, in return, are quite damaging to the psyche of workers that leads to higher levels of anger, therefore, decreasing productivity in the workplace.

Additionally, productivity can be lower than expected because some people confuse work and non-work purposes of technological advances. For that reason, studies show that workers can use their computing devices to visit recreational and entertaining websites that are not connected with their job in any way (Colbert et al., 2016). Indeed, because of the quick digital development aiming to ease human life, employees, instead of focusing on their work, use social networking sites, online shopping, video games, and so on.

The negative aspects of computerization mentioned in the two previous paragraphs can be solved by quite an effective people-focused approach in work relations. First, the problem with data overload can be dealt with by checking up on workers and limiting the number of emails and inquires they have to face. Following employees’ rights and liberties is surely essential while implementing digital transformation (Meske et al., 2020). Second, in order to prevent employees from using unwanted websites, the workspace administrators should control workers’ online appearance and movements. Certainly, this method has to be used with precautions so it does not negatively affect workers’ privacy and mental health. On the contrary, the people-focused design of digitalization is meant to care more about workers’ needs (Williams et al., 2018). Hence, the current people-first trends are rather helpful in creating a safe and productive work community in a digital sphere.

To begin with, the digitalization of work-related spaces has shown many positive outcomes that are considered to improve sufficiency and productivity as well as, most importantly, the comfort and intellectual well-being of the workers. Obviously, computerization can help in the everyday workspace to amplify the workers’ voices and show their needs and inquires for better efficiency and mental state of the workers. Social studies scientists say that modern digital technology has various advantages for the working sphere because, first, employees have free access to any practically needed information (Colbert et al., 2016). Second, in the article, the authors mention that digitalization allows workers to collaborate with colleagues worldwide without any previous difficulties connected with long-distance work relations (Colbert et al., 2016). Third, one of the most crucial characteristics of computerization for improving work efficacy is the reduction of material waste in organizations (Attaran et al., 2019). Moreover, employees are now able to deliver any products with decreasing costs and increasing capabilities. Therefore, these positive repercussions are possible in business digitalization.

To conclude, further research is crucial in understanding the future influence of technological and digital fluency in the workplace. This paper has provided different arguments proving that well-thought digitalization is quite beneficial for the civilized system of work relations, and it is able to solve its own disadvantages. Although people are still in the process of proper modernization of professional equipment and resources, scientists already see visible advantages of such advances. Moreover, obvious challenges and negative aspects of digitalization can be solved by high-profile employers who can control the statics and data delivery.

• As for me, the most challenging aspect of this process was finding reliable sources and information for the research. It was quite difficult to look for new articles that could shed light on the issue of digital transformation in the workspace. However, I managed to find really interesting articles by academically acclaimed authors, but it surely took some time.
• I think my thesis statement about the efficacy of well-thought digitalization might be successful because it clearly correlates with the main body of the research. In the paper, I mention all the advantages of digital implementation and, more importantly, I argue how inevitable negative aspects can be solved. Thus, I am trying to prove the sufficiency of modernization of work relations.
• It was definitely useful for me to make a clear and understandable plan of my work, so I do not forget to mention essential points and arguments while writing the paper. In my outline, I posed a question and a working thesis; then, I wrote the main body where I mentioned the positive and negative aspects of digitalization and how to deal with implementation challenges. In the conclusion, I copied my thesis statement and mentioned the previous arguments on the benefits of digital transformation in the workplace.
• It would be helpful to get honest feedback on my paper so I can learn from my mistakes and become better at doing any kind of research. Additionally, I wonder whether there are any pieces of advice on how to successfully look for academically acclaimed articles and other materials for future writing.

Attaran, M., Attaran, S., & Kirkland, D. (2019). The need for digital workplace: Increasing workforce productivity in the information age. International Journal of Enterprise Information Systems 1 5 (1), 1-23.

Colbert, A., Yee, N., & George, G. (2016). The digital workforce and the workplace of the future. Academy of Management Journal 59 (3), 731-739.

Meske, C., & Junglas, I. (2020). Investigating the elicitation of employees’ support towards digital workplace transformation. Behaviour & Information Technology , 1 -17.

Sivunen, A., & Laitinen, K. (2019). Digital communication environments in the workplace. Workplace Communication , 41-53.

Williams, S. P., & Schubert, P. (2018). Designs for the digital workplace. Procedia computer science , 138 , 478-485.

• Chicago (A-D)
• Chicago (N-B)

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Bibliography

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WTO TRAINING COURSES

The “Trade in the Digital Era” interactive training course is available from the WTO e-Learning platform , one of the key capacity-building programmes provided to WTO members and observers by the WTO's Institute for Training and Technical  Cooperation.

“The move to digital trade gives developing economies opportunities to leap forward and some have done so with mobile payment and banking solutions,” said DG Okonjo-Iweala. “To do so, however, access to modern information and communication technologies is not enough. They require a deep understanding of the digital trade landscape, its opportunities, challenges, and the role of policies and trade rules.” Her full video message can be found here.

Designed for trade government officials, policymakers and the public at large, this new series provides essential tools and concepts for improving participants' knowledge of digital trade. It will comprise a total of five courses, to be rolled out consecutively over the coming months. The first course gives a general overview of how the digital revolution is transforming trade, as well as the benefits and challenges of the digital economy.

Topics covered by the four other courses will include policy issues and WTO rules and discussions, the role of new technologies in international trade, especially artificial intelligence and blockchain, and provisions in members' regional trade agreements that relate to trade and the digital economy.

Also speaking at the launch ceremony was WTO Deputy Director-General Xiangchen Zhang who stated: “During the 13th Ministerial Conference, many of you expressed concerns about the digital divide and the need to build developing economies' capacities so that they may seize the benefits of digital trade. The WTO Secretariat is well aware of these challenges, which is why we have been stepping up our technical assistance activities related to digital trade to help bridge the digital trade gap between WTO members.”

Rwanda's WTO Ambassador, James Ngango, said: “I sincerely hope that this capacity-building opportunity will attract many participants from across regions and contribute to further unlocking the potential of digital trade.”

Singapore's Ambassador and Permanent Representative to the WTO, Hung Seng Tan, said: “Singapore recognises the critical importance of capacity-building and sharing of technical knowledge on digital trade for developing and least-developed country  members. Singapore is committed to continue working with partners, including the WTO, to deliver on the development dimension of digital trade.”

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