Digital Transformation: Better Operations, Better Customer Experience, Better Bottom Line

In today’s post-pandemic market, business models are evolving fast. Companies are turning to digital technologies to streamline their work processes and the way they interact with customers. The impetus to change is driven largely by the demand for real-time service ––anytime, anywhere, on any device. Keeping up with this new, “always-on” experience is forcing businesses to embrace digital transformation or risk falling prey to competitors.

What are the benefits of digital transformation?

For those seeking a competitive advantage, implementing a digital transformation strategy that improves business today while building for the future is a top priority. The benefits of digital transformation include:

• More efficient and effective business processes
• Streamlined operations
• Higher customer satisfaction
• Greater shareholder value

Worldwide spending on technologies and services that enable digital transformation is forecast to reach $2.3 trillion in 2023, according to industry analyst firm IDC. Digital transformation spending is expected to steadily expand throughout the 2019-2023 forecast period, achieving a five-year compound annual growth rate of 17.1%.

Turning a digital transformation strategy into digital business triumph

Digital transformation looks good on paper, but the proof is in the eye of the beholder—the customer. Here are two companies that invested in digital technology and are reaping the rewards.

UPS gets an EDGE on competitors with data-driven insights

With the boom in e-commerce, United Parcel Service (UPS) is now delivering 31 million packages a day. Doing the quick math, that’s about 370 packages every second, around the clock. The logistics at the heart of its business are immensely challenging. As part of its digital transformation initiative, UPS invested in advanced data and analytics to ensure every aspect of their supply chain was as efficient and streamlined as possible.

The company began collecting and analyzing all sorts of data from its facilities in 2016. They measured how workers placed packages inside delivery trucks in the morning. How many recruits they hired during the busy holiday season. How vehicles were washed. That data formed the heart of the company’s Enhanced Dynamic Global Execution (EDGE) initiative, which now includes 25 projects that are projected to save UPS $200 million to $300 million per year once fully executed.

Putting actionable data into the hands of the people who use and make decisions with it is a big part of what makes the UPS digital transformation successful. UPS’ annual technology budget is in the $1 billion range, inclusive of large-scale, enterprise technology as well as day-to-day devices and training for all involved. Supervisors are given tablet computers that have mapping and routing software and digital checklists for assessing driver safety and performance. The company provides digital training to drivers on how to use tablets to scan packages, collect signatures, and access mapping software that calculates the most efficient delivery routes. The data collected from these tablets also helps IT and logistics teams to streamline delivery operations even further.

In addition, UPS is leveraging digital technology to give its customers more details about their upcoming deliveries. When UPS workers scan packages in the morning, the data is uploaded and sent to people as progress emails about their shipments. Customers receive updates as a free service. After signing up, they receive a message that their package will arrive that day, along with an estimated delivery time.

In short, UPS empowers their workers to deliver a high-touch service, engage in more communication with customers, and ensure recipients receive packages sooner.

Domino’s Pizza: digital technology and collaboration for the win

Domino’s Pizza began its digital transformation journey by building out a more robust internal IT function. They recruited a team of people capable of developing new digital applications and empowered them to collaborate across the organization to find innovative, customer-centric ways to delivery their product.

In 2008, the company launched its Pizza Tracker technology to enable customers to track the progress of their online orders via Domino’s website. In 2011, they launched their highly-rated iPhone application, further simplifying the consumer’s path to purchase. Today, customers can order Domino’s Pizza from 11 different devices and media channels through Domino’s Anywhere. Domino’s Pizza is also the first company to deliver pizza by drone and has started testing delivery via autonomous vehicle.

A digital-first mindset

Adopting digital technologies will only take a company so far. Adopting a digital-first mindset company-wide—giving people the ability to use technology to innovate and deliver exceptional service—is the key to long-term success.

UPS and Domino’s Pizza have been successful in their digital transformation initiatives because they made those on the front lines—from app developers to loading dock supervisors to delivery drivers—integral to the process, effectively making them co-designers of the new way of doing business. They leveraged everyone’s in-house experience and know-how to improve performance in tangible ways, and gave people the tools, coaching and training they needed to carry forward (in more corporate terms, to “digitally enable their workforce”).

These examples demonstrate how digital transformation can be used to improve operational efficiency, reduce costs and enhance customer service in ways that make a real difference to a company’s financial health and future viability. There is literally no aspect of one’s business that digital transformation cannot positively impact, from sales and marketing, to back-office functions such as accounting and procurement, to C-suite decision-making and shareholder value creation.

Coaching and training for digital transformation

Digital transformation starts with people. When managers are coached in a 1:1 setting, a transformation initiative has a 91% chance of being successful. When they’re not, that falls precipitously to 30%. With strategic digital transformation so critical to an organization’s success, implementing a long-term approach to make change possible—and to help it stick long-term—ensures leaders and employees adapt to, and thrive, in a new digital-first culture. Effective coaching and training for digital transformation can go a long way toward helping people become adaptable, resilient and able to work collaboratively to stay on top.