Driving Successful Digital Transformation with UC

Written by Tim Poindexter – Former Global VP of Field Marketing | Jan 20, 2018 12:00:00 AM

Digital Transformation (DX) as a trending phrase (and actual activity) is hotter than ever before, though the late 1990's mid-2000's saw their own share of talking heads waiving the DX banner. That said, the digitization of those times was largely applied to existing analog processes, and while analog-to-digital conversions can be incredibly powerful, calling that progression truly transformational is a bit of a stretch. We predicted that 2018 will be the year that digital transformation will meet it's moment of truth and ROI will have to be realised, but first here's how DX can be described.

DX is the innovative application of a technology (such as cloud, mobility, collaboration, analytics, or even artificial intelligence or virtual reality, etc.) to create a new process, product, or experience such as, using sensors instead of people to monitor oil rigs, or using collaboration software for a meeting instead of having to fly to another city. Once this process or product is created (or improved, if we use the broader definition), it should ultimately drive value by increasing revenue, improving operations, improving customer experience, differentiating from competitors, etc.

To see how performance management tools make digital transformation initiatives easier, view these case studies.

We spoke to Robin Gareiss of Nemertes Research about driving digital transformation ROI with UC; the below is an extract from the webinar.

In the diagram below yellow arrows are located next to each gear, which represent how the gears are turning in tandem with each other. If a single gear stops, the entire transformation comes to a halt. The arrows also represent speed—if you don't move quickly in your digital transformation initiative, you are at greater risk of being out-maneuvered by your competitors, and your slow pace might be a consequence of poor planning and/or execution.

The end result could be a significant amount of wasted time and money. While digital transformation projects vary, the high level definition of success is that you must realize some form of meaningful improvement in your business goals. At a high level, those goals are summarized as:

1. Increasing Revenue
2. Improving Customer Experience
3. Decreasing Costs
4. Attracting and Retaining Employees
5. Gaining a Competitive Advantage

The technology you use along with your supplier selection is critical in achieving any one of these business goals. In addition to your processes and culture, these considerations will be central to becoming successful in your digital transformation.

When Should You Begin Seeing ROI?

According to Nemertes Research, depending on the type of project, companies that are successful with digital transformation see ROI within six months after the initiative is ready to go (that's after the idea is created, the budget is formed, and a team is put into place). It usually takes about 6 months for the initiative to be ready, and another 6 to 18 months for the ROI to develop. If you don't expect to see ROI until 2+ years after the initiative is ready, that could be cause for concern. It will be more difficult to secure funding for new projects if you aren't able to demonstrate that you've been able to drive ROI. Do not prolong the duration of time until you can prove your project's value. Instead, see if there are other ways to show value sooner than 2 years out (unless you're including development time in the total). If there is a project that will not ultimately see an ROI, it would be better if you found this out sooner rather than later. That way, you can stop investing time and effort into the project and move onto something else.

Digital Transformation Hinges Upon Customer Experience

Nemertes does many different kinds of success correlation, and when it pertains to digital transformation, customer experience was a major influence in this round of research. Any time you can tie a project to customer experience, your chances of getting approval and buy-in are greatly increased. Nemertes asked organizations to name the top application of their digital transformation, and the highest percentage of respondents (50%) said it was to improve customer experience through the use of technology. When asked what was driving their digital transformation initiative, the highest percentage again (48%) said it was to improve the customer experience. Additionally, 40% of organizations said they were going to increase the IT staff handling customer experience by 2018. Ultimately, both the internal and external customer experience is improving due to new contact center channels, new ways to analyze information going into a contact center, and even new kinds of communication being used with customers and high value prospects.

What Makes a Successful Digital Transformation Organization?

Budget: Successful companies had, on average, a normalized budget of $983 per employee (this number varies based on size). The cost would likely be much lower for large companies with 80,000+ employees, at around $200 or less per employee.

Advisory Board & C-Level Support: Successful companies also had an advisory board in the initiative that was spearheaded by the CEO of the company board itself. This kind of high-level support for the digital transformation is especially true when the company has an enterprise-wide initiative (this factor is present in about 1/3 of companies).
IT & Business Collaboration: Successful organizations also have staff members from both IT and business units involved at equal to or greater than 2% of the employee population. Nemertes saw about a respective 52/48 split in IT vs. corporate controlled specialist marketing initiatives. (IT is very influential in this respect.) More than 75% of internal transactions and 50% of external transactions are digital in a successful DT organization. That means less paper usage, but also the ability to track and perform analytics on these kinds of transactions.
Technology Investment: Finally, more successful companies invest more in technology overall. Let's go into more detail about which specific technologies correlate with success.

Let's go into more detail about which specific technologies correlate with success.

IT Spending 2017: All vs. ‘Success' Group

Nemertes Research looked at the areas where successful companies increased their spending compared to companies who didn't fall into the success group.

Unified communications and collaboration tops the list, where successful organizations increased their spending 72% more than unsuccessful organizations.

Interestingly, the results demonstrate that successful companies want to make sure they have a strong foundation that supports all upcoming transformative applications and initiatives. They realize that it would be a serious issue if a video channel was implemented for customers, for instance, only to determine that the network was unable to support the traffic. That kind of dissatisfaction would likely result in users abandoning the solution entirely.

UC straddles the line of both a strong foundation and innovative solutions - part of UC is foundational in terms of regular voice traffic and instant messaging presence, while moving forward it will be used for innovative areas like team collaboration and mobile enablement. We're even seeing AI and machine learning being built into UC for some surprising applications.

In Part II we'll look at importance of User Awareness and Adoption Initiatives.

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