Digital transformation has never been more important for growing businesses. Find out why with insightful and practical digital transformation examples.
The pandemic has revealed an urgency for digital transformation for small and medium-sized enterprises. But what exactly is digital transformation and what does it mean to a business? A simple definition is: Automation and integration that creates better processes and experiences for employees, customers, and vendor partners. Today, I’ll elaborate on digital transformation by making it clear that it is a journey and not a moment in time. Like building a new house, digital transformation requires a solid foundation.
Unfortunately, this is where many digital transformation endeavors get off on the wrong foot.
The mistake that too many businesses make when creating their IT infrastructure has a good deal in common with building a house. Both begin with the need for an excellent foundation. A foundation that allows for growth and future expansion can be extended easily and very quickly, ensure upgrades aren’t progress killers, and facilitates speed. Simply put, a business’s IT foundation needs to be flexible.
Look to the Cloud for Flexibility
The decision to deploy your IT systems in the cloud will ensure that your IT foundation can be flexible and can grow quickly with your business over the decades to come. That’s because cloud-based systems can grow easily. New servers, additional licenses, more resources like memory and RAM take only minutes, not weeks, and don’t even reach the threshold of being considered an actual project. There is zero business disruption. In most cases, it’s a simple 30-minute order and change. The slowest part is the people initiating the change.
As the years have passed, Vision33 customer experiences have reported tremendous benefits of the cloud. When I interview customers about their deployments, I’ve been told cloud-based systems were the easiest and most trouble-free part of the entire endeavor. Cloud systems deliver so much value and have become so reliable that we are well on our way to 80% of all new Vision33 customers choosing cloud deployment. When your IT foundation is built in the cloud your business will stand the test of time.
Where Digital Transformation Starts
Does this mean that you can’t digitally transform your business without being in the cloud?
No, but it will be harder, it will cost more, and it will take longer. Technology (hardware in particular) changes fast, and cloud servers are being upgraded in real-time continuously without business interruption. That can’t be said for bare metal systems in an on-premise server room.
There are still a few industries with government regulations that currently make it impossible to select cloud deployment. However, it has become the recommendation of Vision33 that businesses should choose cloud for their future. If you have not already joined the growing number of cloud-based businesses, your next upgrade is the logical place to begin your journey to digital transformation.
There are several varieties of cloud deployment to suit a business’ needs. We won’t get into the details in this article, but you have probably heard phrases like the list below. Before you make a final decision regarding your cloud deployment, be sure to understand the implications of each and how they might be applicable and beneficial to your business.
- Private Cloud
- Public Cloud
- Multi-Tenant Cloud
- Hybrid Cloud
For Businesses That Are Already in the Cloud
If you are already in the cloud, having a strategic plan to continue your digital transformation journey is essential. Your business’s enterprise resource planning (ERP) solution, such as SAP Business One, is often considered the baseline or starting point for your digital transformation. Businesses describe their baseline or system of record with any number of phrases like:
- Basic business processes
- Platform for scalability
- Digital core
- The integration center for your enterprise
- Your financials hub
- Data repository
The truth is no single ERP application does everything perfectly or completely. While some businesses take a leap forward when they deploy a new ERP system, for most it represents a beginning—a new and far better primary system of record to build upon. ERP is the first major and essential step in a journey that is ongoing and never fully accomplished.
Beginning the Digital Transformation
When you begin your digital transformation journey, and growth begins to happen, outside influences like a pandemic, demand change, or perhaps an acquisition creates multiple warehouse locations and new product lines. Scores of questions and additional requirements begin to surface such as:
- I wish we had better CRM.
- We need our web store to be connected.
- Is there shipping integration available?
- Marketing wants HubSpot integrated.
- Can we deploy handheld barcode readers?
- How do we distribute reports automatically?
- Is there more sophisticated manufacturing?
- Purchasing needs better MRP for inventory.
- What about payroll integration?
- How can we take credit card payments?
- Are there other options for HR?
- Walmart is insisting we automate EDI.
- Is it possible to connect our support system?
There are multiple approaches to addressing these requirements. Digital transformation is by no means a one-size-fits-all recipe for success. There is room for creativity and uniqueness whereby every business can chart their own best path forward. This problem-solving process requires a good deal of introspection, teamwork, honest conclusions, and prioritization.
Businesses that are successful with digital transformation are good at creating a long-term plan with clear goals and priorities where projects with a significant return on investment come first.
From Integrated ERP to Best-of-Breed Solutions
Over the past 20 years, there has been an attempt to create a more one-size-meets-all ERP solution. Within a publisher’s overall solution portfolio, there might be four or more ERP applications, each one addressing a specific marketplace or business segment, some increasing in complexity and depth of features and functions for larger and more complex business. All of them fall short.
Customizations, add-ons, point solutions, plugins, and integrations to eCommerce, EDI, and other specialty products have always been necessary to truly satisfy the business requirement of most businesses. One simple illustration is the fact that over 80 percent of Vision33 SAP Business One customers run at least one additional add-on product. The average is closer to three add-ons per customer.
Moving from integrated ERP solutions to a best-of-breed application approach is the new-old way businesses will build their digital solutions today and in the future. To some, this feels like going back to the future, because it’s what we used to do out of absolute necessity. In the past, the problem was the integration technologies were not sophisticated enough to address everyone’s requirements, nor were they robust enough to handle the ever-increasing transaction volumes for such things as EDI. Not only this, but databases themselves struggled to store the Big Data businesses began to insist upon.
However, databases got better, hardware improved (64-bit), storage devices made quantum leaps, and in-memory databases have become the new norm. Add to that the benefits of cloud computing and the possibilities of integration without the limitations of the past. Now more than ever, digital transformation is achievable.
Enter Vision33's Saltbox Platform
Vision33’s Saltbox platform is a new, born-in-the-cloud iPaaS (integration platform as a service) solution that is made for today’s technology and designed to make integrations cost-effective, robust, and reliable. Not every solution for SAP Business One requires a Saltbox type solution, but many will. If you have spent the past five years creating a now perfect eCommerce store for your business, Saltbox is how it can be integrated to SAP Business One. The possibilities are endless. The Saltbox solution has been adopted by Vision33 customers faster than any other platform we have ever introduced.
We live in a world where artificial intelligence (machine learning) and automation are transforming the way businesses communicate with their entire supply chain and how they collaborate more effectively with their customers and empower their employees. Saltbox will help ensure that your entire technology suite of products and endeavors become one unified data knowledge base. That’s what these new technologies require to operate at high efficiency—access to all data all the time. Every future integration project should seriously consider making Saltbox the platform of choice for this reason.
Digital Transformation Project Disciplines
Let me suggest that digital transformation system projects fall into one of five possible disciplines or areas of expertise.
- Inventory management and movement operational improvement
- Data transformation/consolidation, analytics, and reporting
- Employee empowerment through better access to information
- Taxes and accounting
- Sales, marketing, and customer service operational improvement
Within each of these areas, there are perhaps a few, maybe even a very long list of potential initiatives that might be a part of your strategic plan for growth and the scalability of your business. In the broader definition of digital transformation, there are also company cultural transformations and even business model changes (e.g., how does a subscription economy fit your business?) to consider.
A business owner or leader must have a good idea of where the company will be in five or even ten years down the road. You could call it insight, vision, or intuition, but I call it planning. The plan shouldn’t be static and set in concrete, it should always be under review, continually adapting to technology as it changes and improves. Without an overall direction for the business, the technology decisions will inevitably miss the mark and disappoint.
There is no such thing as one-size-meets-all. Even within a business in a vertical marketplace, there are nuances between competitors that customers look for when deciding on a long-term business relationship. This list can give you an idea of the different means companies have to address efficiency requirements in those five disciplines outlined above.
Prioritizing Your Digital Transformation
Most companies have requirements in each of these areas. The solutions businesses that invest in and deploy, or the decision to not invest and continue an older or manual process depends on many factors. The perceived return on investment prioritizes them. It’s unlikely that a business can support or effectively manage everything they might like to do. Their plan must be prioritized to make sure that the very first strategic project returns the most significant possible benefit to the business.
Download our eBook below to learn more about digitally transforming your business through integration and automation. Understand how to identify key areas of your business to focus on and how to identify areas for change that will have the biggest impact. Read case studies of businesses that grew through the pandemic through simple process automation or system integration.