Digital transformation is the process of using technologies to create and modify the existing business processes and increase efficiency. It fundamentally changes how you operate and deliver value to your customers.
Every company is it small or large, needs to embrace digital transformation to stay ahead of its competitors.
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In fact, IDG, State Of Digital Business Transformation, reveals that 89% of businesses have accepted their first business strategy as digital transformation. Out of which, 95% of businesses are in the service sector, 93% in financial services, and 92% in healthcare.
Many businesses often associate digital transformation with highly innovative technologies like artificial intelligence, robotic process automation (RPA), and predictive analytics. This is why they refrain from implementing any kind of change.
However, companies eager to implement a digital transformation strategy shall map out a plan of action. This is where enterprise resource planning software comes into the picture.
Importance of Digital Transformation
John Chambers, former Executive Chairman of Cisco System, says, “At least 40% of all businesses will die in the next 10 years if they don’t figure out how to change their entire company to accommodate new technologies.”
Digital transformation is at the core of the survival of businesses. It not only helps in enhancing operational efficiency but also helps businesses in making decisions proactively.
Despite that, only 34% of companies have undergone a digital transformation.
Let us look at some of the benefits that digital transformation can bring for your business.
1. Improved Customer Experience
With so many businesses offering similar products, it’s hard to stand out from the crowd. Providing an excellent customer experience
It largely influences customers’ buying decisions. 86% of customers will pay more for a brand that offers a seamless shopping experience.
Digitization can help boost the customer experience as it enables you to maintain real-time communication with customers. For instance, AI-powered chatbots can resolve queries in no time.
Furthermore, retailers can make sure that the shelf is refilled before it runs out of stock. It adds up to create a smooth customer experience, allowing companies to earn trust and loyalty from their customers.
2. Better Collaboration
Another advantage of digitization is that it ensures the smooth flow of information amongst various departments. It makes the work environment less siloed and promotes smooth collaboration.
For instance, the purchasing department can easily work together with the finance department for payments to the sellers on placing the order for new stock. Besides, technologies like CRM maintain a contact database whereby all historical data of the client related to their buying behavior, engagement, and more can be accessed.
3. Data-Backed Decisions
can help you differentiate yourself from your competitors.
Having data enables you to measure whether you are performing at your standard level or not. You need numbers to compare.
Leveraging the power of digital technologies such as ERP, you can track metrics and analyze the collected data during your operational processes. Based on these insights, you can optimize your business processes and develop strategies that can drive more profits.
Data-driven insights help you understand customers’ behavior and enable hyper-personalization. For instance, if a customer came to the store for a particular item that was out of stock, you can send a message and notify them when the product is back.
It shows your customer that you value them and thus, helps establish trust.
Key Elements of ERP and Digital Transformation
An ERP system encompasses a wide range of functions that entails both front and back office, such as supply chain management, accounting management, customer relationship management, project management, inventory management, and more.
It aims to bring digitization by streamlining and automating various administrative tasks to ensure the smooth running of the business.
There are various key elements of ERP that bring about digital transformation.
1. Business Intelligence
Business intelligence is a key element of an ERP solution as it helps make data-driven decisions. It collects and analyzes data to give you actionable insights related to your business.
It allows you to monitor your chosen key performance indicators (KPIs) and make changes as required.
2. Customer Relationship Management (CRM)
Enhancing customer experience is the core result of digital transformation.
An ERP system provides data that helps you salespeople better serve your potential clients as well as existing customers. They know their likes and dislikes and provide personalized offerings accordingly.
A CRM platform allows you to keep track of your customers and sales data within your digital ERP solution.
3. Supply Chain Management
Another key element to ERP digital transformation is the ability to monitor and forecast demand and sales.
It collects data in real-time, allowing you to optimize your supply chain. It ensures less wastage of resources and timely production and distribution of final goods. This ultimately affects your customer satisfaction when they get what they want.
How ERP Contributes to Digital Transformation in Business?
There’s no denying that an ERP system has a major impact on digital transformation. Let us look at how.
1. Effect of Cloud-based ERP
The ever-growing popularity of cloud-based ERP systems gives you access from anywhere. It ensures 24*7 monitoring of your business process and better utilization of available resources.
In other words, it is accelerating the pace of transformation by syncing information from various devices in real-time.
2. Competitive Edge
ERP and digital transformation go hand in hand. The use of digital ERP gives your businesses a competitive edge as it opens new doors for opportunities.
3. Faster and More Efficient Processes
An ERP transformation is all about optimizing your business processes to increase work efficiency. The ultimate goal is to maximize profits while increasing customer satisfaction.
4. Reduced Costs
The use of an ERP system helps reduce costs as it ensures optimal utilization of resources, including labor, time, and money.
5. Make ERP Customer-centric
An ideal outcome of digital transformation is enhanced customer experience. A digital ERP has the ability to create and offer a seamless shopping experience to its customers.
An ERP system aligns internal processes to fulfill your customer demands on time. It gathers customer data from various processes, which in turn, is converted into actionable insights to enhance pricing, supply chain operations, and inventory control.
6. Improved Safety, Quality, and Productivity
With ERP digital transformation, you can gain real-time visibility and ensure process compliance to identify any defects or manage potential risk factors. It provides you with valuable insights to drive continuous improvement when it comes to your employee safety and production activity.
7. Determine Information As Per Your Needs
Another significant impact of ERP transformation is that it gives you easy access to the information you need. It makes it easy to make smart and fast decisions even during critical times, and you don’t have to rely on your gut feeling anymore.
Wrap Up
Digital transformation begins and ends with customers. The sooner you realize this, the better for your business.
With new technologies, find new ways of doing things that can favor your business growth.
To conclude, an ERP digital transformation is the future of all industries.
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