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How Digital Transformation changes value creation (Part II)

Through innovation and acceleration programs, companies can evolve their business models by leveraging their assets and strengths while harnessing new digital tools.

 

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For instance, automotive companies have integrated internet of things (IoT) sensors and data analytics into vehicles to offer smart and connected features, thus transforming traditional cars into intelligent, connected products. Even the healthcare industry, traditionally known for its conventional practices, has adopted digital transformation to launch new products and services such as telemedicine platforms, enabling remote patient consultations and digital health monitoring.

Other companies may stick to current products and services, but completely reshape the customer experience.

In the banking and finance sector, institutions are redefining customer experience through mobile banking apps and online platforms. Customers can now manage accounts, transfer funds, and access financial services wherever they are.

The same with Government and public services that are reshaping the way they interact with its citizens, by dematerialization and simplification of processes.

In this context, regardless of their industry, it is essential for all companies to establish a compelling digital presence through an inclusive corporate website that addresses accessibility, leaving no one excluded.

 

Transform how value is created

Digital transformation is often associated with efficiency improvements and cost reduction. Automation, artificial intelligence, and other digital tools are being used to streamline operations and reduce unnecessary costs. As companies become leaner and more agile, they can redirect resources toward more value-added activities.

For instance, robotic process automation (RPA) is being employed to automate repetitive and time-consuming tasks. This reduces the need for human intervention, thereby reducing operational costs. The savings can then be reinvested in research and development, product improvement, or further cost reductions, resulting in a positive feedback loop that enhances the company’s value proposition.

Digital transformation not only empowers the reshaping of processes but also enables this transformation to occur at an accelerated pace. Using digital tools, companies can swiftly create minimal viable products, gather consumer feedback more rapidly, and iterate product features. This approach involves working within an agile development process that minimizes risk and enhances the likelihood of success.

 

Deliver change

Finally, despite all the disruptive potential of digital tools compared to others in history, tools remain tools, to be ultimately used by humans. This implies that all digital transformation will primarily involve people. As much as there is currently an advocacy for change and a desire for agile organizations, the truth is that this change is not inherent to human beings (not even in physics, for that matter).

The natural tendency is to maintain the status quo. Breaking away from this inertia creates significant discomfort within the organization. Therefore, all digital transformation initiatives or others should be accompanied by change management projects and the requalification of individuals. The transformation in the way companies create value through digital means will only be complete by engaging and retraining people to actively contribute to the process through organization-wide change management projects and the use of digital tools as instruments of this change, such as intranets and corporate portals.

In conclusion, digital transformation is not just a buzzword; it’s the key to the future of value creation in business.

It is a journey that companies must embark upon to remain competitive in today’s rapidly changing business landscape. Those who embrace this transformation and harness its potential will find new avenues of value creation that were once unimaginable in the analog era. Digital transformation isn’t merely a technological shift; it’s a revolution that touches every aspect of a company, from its products and services to its relationship with customers and partners. It will continue to blur the lines between industries, reshape business models, and create new opportunities for those who are willing to adapt and innovate.

By Hugo Dias & Pedro Lima

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