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What is a digital transformation strategy?

Embracing new technology can be the key to business success – here’s all you need to know.

It’s easy to become enamored by new technology. The possibilities behind 5G cellular service to transform how we do business are tremendous. When companies are considering how AI technology could improve a business process or impact sales and customer service, there’s a tendency to start pulling levers and making changes, and yet every new technology in 2020 and beyond that into the next decade could have far-reaching implications.

That’s why it’s so important for companies to have a digital transformation strategy. As new technology emerges, companies can avoid the pitfalls of embracing those advancements too quickly, rolling them out in a way that could cause too much disruption (or even too little), and not properly tracking the changes within the organization.

The basic idea with a digital transformation strategy is to analyze your own needs and your own company culture, to set business objectives and understand and document the risks, to run frequent pilots and tests, to ask internal employees for feedback about those roll-outs, to proceed with the new technologies, and then to continue analyzing their effectiveness.

The following steps can help you develop a digital transformation strategy in a way that helps you make the changes required for your company in the most effective ways.

1. Analyze the culture

Any digital transformation strategy has to start with analyzing company culture. The reason for that is simply because your culture — e.g., the people in your organization, the products and services you offer, and even your location — can all dictate the effectiveness of the transformation. If analyze your own culture, you can determine how well a new technology will take root in your company, how it will be received, and its overall impact. Some technologies such as artificial intelligence, chatbots, Wi-Fi technology, network security, and Bitcoin will impact certain industries and cultures different than others.

2. Set business goals

The old axiom “without a vision the people perish” comes into play here. While it’s tempting to start implementing new technology in a company simply because it’s new and everyone else is making changes, the truth is that the timing might not be ideal or you may need to be more diligent and strategic about new technology and how it matches your culture. By setting business goals, you insulate the business and the current processes you use because you can separate a business goal from a technology goal (which may be extremely different).

3. Document the risks

Many companies know there is a risk with digital transformation. It’s a similar risk when a company rolls out a major new internal application r releases a product. The issue that sometimes occurs with digital transformation is that companies analyze and discuss risks but they fail to document and track those risks over a set period of time. One example of this is with 5G cellular service. As we look to 2020 and beyond, 5G has the potential for the most transformation in companies, yet is also a technology that presents many risks in terms of availability, which products can use 5G the best, and unknown costs.

4. Run pilot tests

Once you have analyzed the technology and you document the risks, it’s time to run a pilot test with the technology (rather than rolling it out to every segment of your business and every employee). With a transformative technology like chatbots, it might mean testing the technology with one small department prone business process, such as product support. It might even mean a smaller pilot test internally or with only one portion of the support process. Running pilot tests helps you work out the bugs but more importantly helps you to see how the new technology will impact your business and culture.

5. Ask for feedback

During the pilot phase of your digital transformation strategy, it’s important to ask for frequent feedback. This part of your strategy needs to be more than a simple focus group or analyzing one set of data from a test. The most effective way to ask for feedback might involve conducting a survey, holding multiple focus groups analyze the data from each pilot, or doing all of those activities multiple times. The most effective strategy will involve analyze everything you can about a pilot and seeking feedback long before you ever implement the tech at scale.

6. Roll out the new technologies

Once you have analyzed the pilot tests and followed all of the other steps with your digital transformation strategy, it’s time to implement that technology, possibly with one department or group. At this stage, it’s best to fully embrace the technology ad not attempt to do a partial roll-out or one that only impacts on a small segment of your company, as though you are still doing a pilot test. Trust the analysis you’ve done and the pilots you’ve conducted.

7. Keep analyzing the impact

As part of any digital transformation strategy, it’s important to keep analyzing the rollout. It’s too easy to make a major change in technology such as implementing Bitcoin as a transaction medium or using artificial intelligence as part of your customer support process, but then to assume those technologies have worked and everyone is pleased with the results.

Often, when companies analyze a new technology they’ve implemented, they realize there is more to be done and other changes they need to make. One example of this is artificial intelligence. If a company decided to use AI as part of a sales process, they may see some immediate gains and improvements, but after further analysis, realize they need to automate even more of the sales process or not automate some steps.

Overall, any digital transformation strategy will be the most effective when you match the technology with your own culture, the risks your company has, and the business objectives you’ve set. As stated earlier, it’s critical to separate the business goals and process from the digital transformation goals you set and the associated risks. The business has to keep running smoothly as before; technology is a way to make it run even smoother.

Ref: John Brandon

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