In today’s competitive market, organizations are attempting to implement digital technologies in order to remain competitive, boost productivity and efficiency, and raise profit margins. Digital transformation is the act of changing an organization’s processes through digital technologies.
There are several advantages to digitalization including increased efficiency, increased productivity, lower operational costs, improved customer experience, improved communication, increased transparency, and faster decision making. The focus is on creating value through these new capabilities fast enough to have a competitive advantage over rivals.
Digital maturity is the degree to which the challenges and opportunities of digital innovation are understood by the organization’s management and staff, and are effectively implemented. Digital maturity may also be seen as the ability of an organization as a whole (including people, culture, and processes) to effectively respond to or take advantage of digital innovation. This requires investment in the tools and human resources that can best leverage available technologies.
The path organizations take on their digital transformation journey depends on their digital maturity.
Digital Maturity for small and midsize businesses
As compared to large organizations, small and midsize businesses have fewer resources to dedicate to digital tranformation. For this reason, they need to focus on what is really necessary to enable their transformation journey: they need to understand exactly where they are to plan where to go.
To assess a company’s current level of digital maturity, it is helpful to use a framework known as Digital Maturity Model. The model can also provide a roadmap to reach digital maturity goals, plan for growth, and measure success.
There are many Digital Maturity Models to choose from which provide businesses with data-driven insights around their current levels of digital maturity. An ideal Digital Maturity Model for small and midsize businesses must be easy to understand and to apply, and focus on practical aspects rather than abstract theories.
According to the Digital Maturity Model developed by Deloitte in 2018, we will look at an organization across five business dimensions to provide a clear and tangible indication of where they are with regard to digital maturity. Each dimension provides clarity on what areas need to be focused on to bring digital transformation to the next level:
- Customer experience
Providing and outstanding customer experience where customers view the organization as a digital partner using their preferred channels - Innovation strategy
Continuosly improving the way the organization operates through innovation and digital initiatives - Technology
Ensuring data are created, stored, processed and exchanged securely and effectively - Operations
Executing business processes efficiently and effectively using digital technologies - Organization and culture
Developing an organizational culture to support digital transformation
The five levels of Digital Maturity
Level 1: Initiating
The organization has no clear plan for digital transformation, although IT and business functions may collaborate from time to time in an ad hoc manner.
Level 2: Emerging
Leaders recognize the need and value of digital technologies and are ready to invest in digital transformation. A roadmap exists, and projects are in the early stages. However, departments and business units are still operating in functional silos rather than being part of a coordinated organization-wide effort.
Level 3: Performing
Organizations have set goals and objectives, formulated a plan, and various digital initiatives have been successfully implemented.
Level 4: Advancing
A robust digital mindset exists, and a clear transformation path is defined. The human resources and technologies required for digitalization are available, and digital transformation has been implemented throughout all the departments and business units.
Level 5: Leading
Digitalization is embedded throughout the entire organization and is driving innovation, strategy development, and day-to-day operations thanks to solid digital metrics. The organization sees digitalization as an essential driver of business.
Final Thoughts
Digital Maturity is essential for businesses that plan to succeed in today’s digital-first world.
Organizations need to invest in innovative technologies, build a culture of digital adoption, and provide training for employees to ensure they can use these new technologies effectively. This will help organizations create value through higher efficiency, improved customer experiences, and better products and services.
A Digital Maturity Model is a useful tool to help organization in their digital transformation journeys, measuring maturity in context with their industry and business goals, and enabling them to focus on their digital transformation progress, plans, and goals.
NotifyMe and the Horizon Group provide a range of services to support your digital transformation. We help clients evaluate their current solutions and processes and recommend the best path forward for achieving their goals. Contact us today to learn more.
