The age of digital disruption is upon us, and no company is immune to its effects. Across every industry, customers and employees alike are demanding greater mobility; easier, more transparent access to information of all kinds; and flexible, pleasing user experiences. Internal operations, too, are being transformed as companies look to digitize and automate everything — the factory, the supply chain, even marketing and sales.
And if you think your company should be cautious in its approach to digitization, think again, because even if you’re moving slowly and carefully, your competitors aren’t. They aren’t just paying more attention to social media or capturing more information about their customers’ preferences. Rather, they’re completely reimagining their business models to take advantage of the imminent wholesale shift from strategies based on selling physical products to strategies built around selling the data and services now becoming available through digitization. According to a recent Forrester study, a large percentage of executives think that almost half of their revenue will be influenced by digital by 2020.
Already, companies are dedicating huge resources to the effort to digitize. PwC’s 2015 Global Digital IQ survey found that 31 percent of companies globally, and 44 percent of Canadian companies, are assigning more than 15 percent of their revenues to digital investments. By 2019, companies around the world are expected to have spent a total of US$2.1 trillion on digital transformation, according to IDC.
This level of massive investment brings with it huge risks, especially for companies that neglect to take into account the full impact of digitization in every aspect of their business. IDC also predicts that by 2018, 70 percent of siloed digital transformation initiatives will ultimately fail.
But failure isn’t an option when the very survival of your business is at stake. So how can your company make sure it is getting a positive return on investment from the money and resources it is dedicating to its digital transformation? That’s where the concept of digital ROI comes in.