How digital transformation can make your business more productive

Tech moves fast. If you want your business to stay efficient and competitive, you have to keep up. When done right, digital transformation can sharpen your business model, streamline your operations, elevate customer experience and energize your organizational culture.

The question is, where should you start?

Before diving into the most common practices, let’s begin by identifying the most prevalent challenges and explaining why digital transformation is essential for businesses of any size.

Definition and examples

Digital transformation is about weaving technology into different parts of your business to optimize performance, enhance customer experience and stay competitive in your market. In practice, this can look like:

• Automating processes and certain administrative tasks
• Performing data analytics to improve the user experience
• Integrating robotic process automation into production lines
• Implementing a chatbot to answer customer questions in real time
• Performing preventive maintenance on equipment
• Rolling out an inventory management system to aid with supply chain management

How is digital transformation different from digitization?

Digitization is about converting analog processes and documents (like hands-on tasks and paper files) into digital form. Digital transformation goes further: it’s a cultural transformation—an organizational and strategic shift that touches every aspect of your business. “The key is to integrate this mindset across every part of the company, from strategic plan to execution,” says Simon Whalen, Managing Director and Market Lead of the Manufacturing Sector at Desjardins.

For example, with digital transformation, you‘re not just scanning old paper invoices. You’re reviewing your reliance on legacy technology, assessing your wider digital capabilities and rethinking your entire billing process.

AI can be especially handy for:

- Automating repetitive tasks, like sorting emails or managing inventory

- Forecasting demand (supply chain management)

- Personalizing communications and recommendations to match clients’ needs

AI uses algorithms and big data to unearth trends and draw connections by analyzing and interpreting data flows.

 Smart dashboards can surface these insights in real time. For business leaders, they’re a treasure trove for strategic decision-making.

That being said, data can carry bias. Artificial intelligence is powerful, but it can’t replace human intelligence. You still need to interpret its output with a critical eye.

In today’s information era, where the only constant is change, a digital strategy is essential for businesses to stay competitive and up-to-date.

According to a study by the Business Development Bank of Canada, productivity has skyrocketed 60% for manufacturing companies that have adopted a digital transformation strategy in the past five years.

According to Whalen, companies that commit to digital transformation reap all kinds of benefits:

• Greater efficiency and time savings

• Lower costs

• Tighter control over production timelines

• Improved user experience

• Better data-driven decision-making

• Better employee experience and stronger retention

• Higher quality

“In some ways, machines can be much more precise,” says Whalen. “They’re better at detecting manufacturing defects, for example.”

Digital transformation isn’t just about tech. It also directly shapes employees’ day-to-day work lives. If done right, it boosts collaboration and innovation.

“People will shift to tasks where they feel more valued and engaged. Their work will be more strategic because the repetitive, assembly-line tasks can be handed over to machines.”
- Simon Whalen, Managing Director and Market Lead of the Manufacturing Sector at Desjardins

It takes time for organizations to adapt to big changes. “Digital transformation is bound to shake up how people work, and that can create uncertainty,” explains Whalen. “But the goal isn’t to replace people with technology. It’s to create synergy between them.”

To make your digital transition smoother and turn it into a real cultural shift, prioritize training, keep internal communications strong and involve your employees every step of the way. 

Limited access to financial, human or material resources can slow down or even stall your digital transformation.

The solution? Make a comprehensive plan that accounts for your current and future needs.

Lots of businesses don’t know where to start or have limited knowledge of new technologies and work methods. That’s exactly why they need to mobilize the right talent and get solid support, both internally and externally.

Unlike a traditional investment, it’s hard to get a clear picture of the costs and financial benefits of implementing digital technologies.

For a better read on the ROI, it’s important to look at a broader set of performance indicators.

“People sometimes make the mistake of only asking whether their productivity and profitability have improved,” says Whalen. “That’s part of the equation, but you should also factor in customer satisfaction, employee experience and product quality.”

Also, remember that an investment isn’t a fixed cost. It’s an expense that can be spread over time as the project evolves. Once you’ve developed a clear digital transformation plan, it may be a good idea to talk to your account manager at your financial institution. They can help you assess the types of support and the financing strategies that best fit your business.

These best practices can help drive a successful transition.

The first step is to do a digital maturity assessment exercise to identify your business’s needs and build a step-by-step action plan aligned with your transformation goals.

For Whalen, the best move is to bring in an external firm. For example, the Quebec Network of Industrial Expertise Centers is an initiative from the province’s ministry of economy, innovation and energy that’s designed to help businesses make the digital shift.

 “An external firm will visit your business and ask questions about processes, your business model and your strategic plan,” Whalen explains. “Then, they’ll set a timeline and pinpoint the projects that are easiest to implement and deliver the strongest ROI.”

Integrating digital technologies gradually is crucial to ensure a smooth transition. It also lets you test different approaches and minimizes risk early on. “The first step of the digital transformation leads to the second, and so on,” says Whalen. “The idea is to build on what’s already been implemented, little by little.”

Another key step is making informed choices about software and digital tools.

For example, your business might need:

- A customer relationship management system that helps you build and manage customer relationships on a single platform

- An enterprise resource planning system that brings together the tools and processes needed to manage different parts of the business, like HR, accounting and manufacturing

- A cloud hosting service that lets you centralize and store files, data, software and servers

Implementing a digital transformation can require a significant investment of time and money. To maximize that investment and choose tools that actually fit your business, you should consider:

- The needs of your business and your teams

- What your staff will need to successfully adopt new tools, like training and a rollout schedule

- How to maximize your use of all available features at every stage of the process

Hands-on support and training are part of sound project management, and they’re key success factors that you don’t want to overlook. “To make it work, it’s crucial to appoint internal project leads,” Whalen suggests. “The digital transformation projects that truly succeed are the ones where employers assign dedicated resources, people with decision-making authority in the company, who lead the projects from A to Z.”

To boost agility, invest in training that fits your team’s reality and skill set. Training can even be part of the transformation itself. For example, you can create interactive learning courses that become a knowledge base for onboarding new hires. 

“When it comes to digital transformation, there’s no finish line,” says Whalen. Digital technologies keep evolving, so it’s a continuous improvement process that you need to revisit regularly and keep up-to-date. One of the keys to success is making continuous improvement a core part of your corporate culture.

You also have to stay on top of your KPIs and readjust your digital strategy as needed. Regularly taking a step back to review your progress is crucial for success.

Key takeaways

Remember, digital transformation isn’t a passing fad. It’s a golden opportunity to rethink your work methods and how you can drive growth, spark innovation and make your business even more competitive and attractive.

Ready to get started? These tips will put you on the right track to kickstart your digital transformation. For advice that’s more tailored towards your business, work with trusted specialists who can help you chart the way forward.

Further reading