Digital transformation is about empowering people with technology to work smarter and faster, not the other way around.
Successful digital transformation requires a culture shift that puts the business user first. Learn how Tallyfy can help enable this shift in your organization here.
Who is this article for?
- Companies undergoing or considering digital transformation initiatives, especially in traditional industries like manufacturing, retail, finance and healthcare
- IT leaders and CIOs looking to drive digital transformation in their organizations
- Business unit leaders and managers who want to leverage digital technologies to improve processes and customer experiences
- Digital transformation strategists and consultants advising organizations on their transformation journeys
- Employees and knowledge workers who want to understand how digital transformation will impact their work and roles
Digital transformation impacts all levels and functions of an organization, from IT to marketing to operations to HR. Having a holistic understanding of digital transformation is critical for alignment and success.
What is Digital Transformation, Really?
The term “digital transformation” has become a buzzword in recent years, but what does it actually mean? At its core, digital transformation is about using digital technologies to fundamentally change how an organization operates and delivers value to customers (Vial, 2019). It’s a strategic renewal of an organization’s business model, collaborative approach, and culture to fully leverage the opportunities of a mix of digital technologies (Warner & Wäger, 2019).
Quote
Digital transformation is more than just procuring new technology; it’s about transforming your organization to take advantage of the possibilities that new technology provides.
Digital transformation involves integrating digital technology into all areas of a business, resulting in fundamental changes to how the business operates and the value they deliver to customers (Schallmo et al., 2017). It’s also a cultural change that requires organizations to continually challenge the status quo, experiment, and get comfortable with failure.
Fact
According to an IDC study, worldwide spending on digital transformation technologies and services is forecast to reach $2.3 trillion in 2023, with a compound annual growth rate of 17.1% over the 2019-2023 forecast period.
Digital Transformation is About Empowering People, Not Technology
A common misconception is that digital transformation is all about technology. But in reality, it’s people who drive digital transformation, enabled by technology. The most successful digital transformations put people at the center – both employees and customers.
For employees, digital transformation is about providing the tools and environment for them to do their best work. It’s about enabling collaboration, breaking down silos, and fostering a culture of innovation. When done right, digital transformation empowers employees to work smarter and deliver more value.
Tip
Focus on the employee experience. Use design thinking to understand employees’ pain points and needs, then leverage digital technologies to enhance their work and enable them to deliver their best.
For customers, digital transformation is about creating seamless, personalized, and engaging experiences across all touchpoints. It’s about understanding customers’ needs and expectations, then leveraging digital to deliver solutions in innovative ways. Customer-centricity is at the heart of digital transformation.
Digital Transformation Requires a New Mindset
More than just adopting new technologies, digital transformation requires a shift in mindset and culture. Traditional business models and ways of working will be disrupted. Organizations need to become more agile, experimental, and adaptable to change.
This requires visionary leadership to articulate a digital vision and strategy, and to create an environment that incentivizes risk-taking and learning (Kane et al., 2015). It also requires upskilling employees with digital capabilities and cross-functional collaboration to break down silos.
Quote – Rhonda Toston
Tallyfy provided us with a modern, global platform to automate, maintain, and cascade content to a wide array of stakeholders, effectively eliminating the need for our teams to ask, “Where can I find the latest version of a playbook?”. We’re excited to continue our partnership with Tallyfy and welcome their growth-forward mindset as we deliver on our commitments to our stakeholders.
Jones Lang LaSalle (NYSE:JLL) is a Fortune 500 company with over 100,000 employees across 80 countries. See more quotes
Most of all, digital transformation requires a customer-centric and employee-empowering culture. Organizationally, this means restructuring around the customer journey and empowering employees to make data-driven decisions. Processes need to be reimagined from the outside-in, designed to swiftly deliver value to customers.
Key Areas of Digital Transformation
While digital transformation will look different for every company, there are some common key areas (Vial, 2019):
- Business model transformation: Fundamentally rethinking how to deliver value to customers, generate revenue, and compete in an increasingly digital world. Examples include transitioning to subscription models or platform businesses.
- Operational process transformation: Leveraging automation, artificial intelligence, and data analytics to enhance processes for greater efficiency and intelligence. Think streamlined supply chains or predictive maintenance in manufacturing.
- Customer experience transformation: Redesigning customer journeys and touchpoints for a more seamless, personalized, and engaging experience. This could involve anything from mobile apps to chatbots to IoT-connected products.
- Workforce and culture transformation: Upskilling employees, creating a digital-savvy culture, and leveraging collaborative technologies to enable new ways of working. Agile methodologies and design thinking often play a key role.
Fact
70% of all digital transformation initiatives do not reach their goals. Of the $1.3 trillion that was spent on digital transformation last year, it was estimated that $900 billion went to waste (Forbes, 2018).
The most successful transformations take an integrated approach across these areas, enabled by an aligned digital strategy. They leverage technologies like cloud, mobile, AI, IoT and blockchain – but always in service of clear business goals and customer outcomes.
The Role of IT in Digital Transformation
IT plays a critical role in digital transformation, but the role is evolving. In the past, IT primarily focused on “keeping the lights on” and enabling business processes. Now, IT is becoming a strategic partner in driving business value and transformation (Berman, 2012).
This requires new skills and ways of working within IT. Beyond just technical expertise, IT professionals need to develop business acumen, collaboration skills, and an outside-in perspective. IT needs to work closely with the business to co-create digital solutions, not just be an order-taker.
Quote – David Christopher Castillo
Tallyfy is absolutely amazing. It’s perfect for medium to large businesses. They also assure you that they have setup data and security measures which makes it perfect for medium to large businesses as well. 5 stars, no questions asked.
Senior Business Analyst – Voyager. See more quotes
Some key focus areas for IT in enabling digital transformation:
- Shifting to cloud platforms and everything-as-a-service to enable greater agility and innovation
- Leveraging automation and AI to enhance IT operations and deliver insights to the business
- Enabling rapid experimentation and fail-fast approaches through DevOps and agile practices
- Ensuring cybersecurity and data privacy in an increasingly digital and regulated world
- Becoming a data-driven organization to deliver personalized experiences and drive intelligent decision-making
Tip
Embed IT members within business teams to co-create digital solutions. This breaks down silos and ensures IT understands business needs, while the business gains digital savvy.
Getting Started with Digital Transformation
Embarking on a digital transformation journey can seem overwhelming, but it doesn’t have to be. Some key steps to get started (Chanias et al., 2019):
Develop a digital vision and strategy aligned to business goals. Paint a picture of your future digital state and how it will transform customer experiences, operational processes, business models, and/or the workforce. Ensure this is clearly tied to business outcomes.
Assess your current digital maturity. Understand where you are today in terms of digital capabilities, culture, and ways of working. Identify gaps to your future vision.
Identify and prioritize digital initiatives. Define the initiatives that will drive the most business value and close critical gaps. Start with lighthouse projects that can demonstrate quick wins.
Build digital skills and culture. Invest in upskilling employees, hiring digital talent, and fostering a culture of experimentation and agility. Empower employees to drive transformation in their areas.
Establish governance and KPIs. Put in place the right governance structures, metrics, and feedback loops to drive alignment and continuous improvement. But avoid rigid top-down control.
Iterate and scale. Start small, learn fast, and iterate. Rapidly scale what works to drive increasing value. Fail fast on what doesn’t. Continuously evolve your digital strategy based on learning.
Quote
The biggest part of our digital transformation is changing the way we think.
– Simeon Preston, Chief Operating Officer at Bupa
Risks and Pitfalls of Digital Transformation
- Lack of clear vision and strategy aligned to business outcomes
- Underestimating the culture and change management effort required
- Pursuing technology for technology’s sake vs. solving real customer problems
- Rigid planning and governance that stifles agility and experimentation
- Siloed initiatives that optimize a specific function vs. the end-to-end customer experience
- Lack of leadership alignment and sponsorship to drive transformation
- Insufficient investment in digital talent and upskilling the workforce
- Treating it as a one-time project vs. an ongoing journey of innovation
How Tallyfy Enables Digital Transformation
Tallyfy is a powerful platform that helps organizations digitally transform their processes to be more efficient, transparent, and adaptable. Some key ways Tallyfy enables digital transformation:
Structure intake – go from standalone forms to trackable workflows
Tallyfy allows you to digitize paper-based forms and structure the intake of data into automated workflows. This streamlines processes, reduces manual effort, and provides end-to-end visibility.
If this then that – set amazingly simple and powerful conditional rules to show the right task at the right time and do more like automate assignments and deadlines
With Tallyfy’s intuitive if-this-then-that rules, you can easily automate complex process logic without any coding. Route tasks intelligently, auto-assign work, and adapt processes on the fly.
Real time tracking – track the status of a workflow without asking anyone
Tallyfy provides real-time visibility into the status and performance of any process, enabling managers to identify bottlenecks, reallocate resources, and continuously improve. No more chasing for updates.
Explain it once – AI-driven documentation
Tallyfy uses AI to automatically generate process documentation as you execute workflows. This ensures documentation is always up-to-date and frees up employees’ time for higher-value work.
Digital transformation is a continuous journey, not a destination. It requires ongoing experimentation, learning, and evolution. Tallyfy provides the process agility and insights needed to constantly adapt and improve in a fast-changing digital world.
How is Digital Transformation Reshaping Business?
Digital transformation is fundamentally changing how businesses operate and deliver value to customers. It involves leveraging new digital technologies like artificial intelligence, cloud computing, big data analytics, and the Internet of Things to enable major improvements and innovations (Vial, 2019). This digital disruption is triggering strategic responses from organizations as they seek to alter their value creation paths while managing the structural changes and barriers that arise (Vial, 2019).
At its core, digital transformation is an ongoing process of using emerging technologies in everyday organizational life (Warner & Wäger, 2019). It requires developing dynamic capabilities to continuously renew the organization’s business model, collaborative approach, and culture (Warner & Wäger, 2019). Engaging with customers at every point of value creation is key to becoming a truly customer-centered business in the digital age (Berman, 2012).
What Opportunities Does Digital Transformation Create?
While digital transformation presents challenges, it also opens up immense opportunities. Beyond just enabling process improvements, digitization has broader implications for how companies innovate and create value (Nambisan et al., 2019). Digital technologies allow businesses to reshape customer value propositions and transform operations for greater customer interaction and collaboration (Berman, 2012).
For example, digital transformation is enabling product firms to transition to service-based business models, a trend known as servitization (Frank et al., 2019). By matching different levels of servitization with varying degrees of digitization, companies can offer new types of smoothing, adapting, or substituting services (Frank et al., 2019). Digital technologies are also being applied to create more sustainable practices in areas like pollution control, waste management, production, and urban development (Feroz et al., 2021).
Fact
Small and medium-sized enterprises (SMEs) make up 99.8% of all enterprises in the European Union non-financial business sector, accounting for 66.6% of total employment (Eurostat).
How Can Businesses Succeed with Digital Transformation?
Developing a cohesive digital transformation strategy is critical for success. However, this is an ongoing process with no foreseeable end, requiring companies to dynamically iterate between learning and doing (Chanias et al., 2019). Some key enablers of effective digital transformation include (Schallmo et al., 2017):
- Fostering an innovation-oriented culture
- Developing digital capabilities and talent
- Implementing agile ways of working
- Establishing digital governance structures
- Measuring and communicating progress
For SMEs in particular, being able to perform cost-benefit analysis of digital technologies and build awareness is crucial (Ulaş, 2019). Many SMEs exhibit inconsistent behaviors when it comes to digital investments and require external support to integrate digital transformation with overall firm strategy (Ulaş, 2019). Dynamic capabilities, especially related to sensing opportunities and learning, are important triggers for driving digital transformation in SMEs (Matarazzo et al., 2021).
What Does the Future Hold for Digital Transformation?
As digital technologies continue to advance at a rapid pace, they will open up even more transformative possibilities for businesses. Trends like 5G networks, edge computing, extended reality, and quantum computing may enable entirely new products, services, and business models not yet conceived.
However, the growing scale and scope of digital innovation will also give rise to new ethical considerations around privacy, security, transparency, and inclusion that businesses will need to navigate carefully. Building trust with customers and stakeholders will be paramount. Those organizations that can successfully harness emerging technologies while proactively addressing the associated risks and challenges will be positioned to thrive in an increasingly digital future.
Tallyfy Tango – A cheerful and alternative take
Picture this: Two tech-savvy friends, Byte and Pixel, are enjoying a latte at their favorite coffee shop. As they sip their artisanal brews, the conversation takes an unexpected turn towards the wonders of digital transformation.
Byte: (enthusiastically) Hey Pixel, have you heard about this digital transformation buzz that’s taking over the business world?
Pixel: (nodding) Oh yeah, it’s like the secret sauce that’s turning dusty old companies into tech-powered superheroes! It’s pretty wild.
Byte: (grinning) Totally! It’s like they’ve discovered the fountain of youth, but instead of making them look younger, it’s making their processes faster and their customers happier.
Pixel: (chuckling) And let’s not forget about the employees! They’re trading in their paper clips and file cabinets for sleek apps and cloud storage. It’s like they’ve been given the keys to a shiny new sports car.
Byte: (smirking) I bet their IT department is feeling like the cool kids on the block now. No more “have you tried turning it off and on again?” jokes for them!
Pixel: (laughing) Exactly! And the best part? Digital transformation isn’t just making things more efficient; it’s opening up a whole new world of possibilities. Companies are coming up with innovative ideas and creating experiences that were impossible before.
Byte: (nodding) It’s like they’ve been given a magic wand to make their wildest dreams come true. Who knew that zeros and ones could be so powerful?
Pixel: (raising her latte) Here’s to digital transformation – the unsung hero that’s turning the business world upside down, one byte at a time!
As they clink their cups together, Byte and Pixel can’t help but marvel at the incredible impact of digital transformation. Little do they know, their favorite coffee shop is about to undergo its own digital makeover, complete with a mobile ordering app and personalized latte art. The future is looking brighter (and more caffeinated) than ever!
Related Questions
What is digital transformation good examples?
Some great examples of digital transformation include Netflix’s shift from DVD rentals to streaming, Uber’s disruption of the taxi industry with a ride-sharing app, and Airbnb’s revolution in the hospitality sector by connecting travelers with local hosts. These companies have used technology to fundamentally change their business models and create new value for customers.
What are the four main areas of digital transformation?
The four key areas of digital transformation are customer experience, operational processes, business models, and company culture. By focusing on these areas, organizations can leverage digital technologies to enhance how they interact with customers, streamline internal operations, create new revenue streams, and foster a culture of innovation and agility.
What is digital transformation in business?
In the business world, digital transformation refers to the integration of digital technology into all areas of a company, fundamentally changing how it operates and delivers value to customers. This can involve automating processes, leveraging data analytics, adopting cloud computing, and more. The goal is to become more efficient, agile, and customer-centric in the digital age.
What is digital transformation in healthcare?
Digital transformation in healthcare involves using technology to improve patient care, streamline operations, and enhance the overall healthcare experience. This can include adopting electronic health records, leveraging telemedicine for remote consultations, using AI for diagnosis and treatment planning, and implementing wearables for real-time patient monitoring. The aim is to make healthcare more accessible, personalized, and data-driven.
What is digital transformation in manufacturing?
In manufacturing, digital transformation involves integrating advanced technologies like IoT, robotics, and 3D printing into production processes. This can enable real-time monitoring and optimization of equipment, predictive maintenance to reduce downtime, and the ability to quickly adapt to changing customer demands. The goal is to create smarter, more efficient, and more flexible manufacturing operations.
What is digital transformation mckinsey?
McKinsey, a leading global management consulting firm, has extensively researched and advised on digital transformation. They view it as a holistic process that goes beyond just adopting new technologies – it also requires rethinking business models, processes, and organizational culture. McKinsey emphasizes the importance of having a clear strategy, strong leadership, and the right talent and capabilities to drive successful digital transformation.
Why do digital transformations fail?
Digital transformations can fail for various reasons, such as lack of clear vision and strategy, resistance to change within the organization, inadequate talent and skills, siloed thinking and lack of collaboration, and underestimating the complexity and scale of the transformation. To succeed, companies need to take a holistic approach, secure executive buy-in, foster a culture of innovation, and invest in the right people and capabilities.
How much do companies spend on digital transformation?
The amount companies spend on digital transformation varies widely depending on factors like industry, company size, and the scope of the initiatives. However, it’s estimated that global spending on digital transformation technologies and services will reach $2.8 trillion by 2025, growing at a compound annual growth rate of 16.4% from 2021 to 2025. This underscores the significant investments companies are making to stay competitive in the digital age.
References and Editorial Perspectives
Vial, G. (2019). Understanding Digital Transformation: A Review and a Research Agenda. Journal of Strategic Information Systems, 28, 118 – 144. https://doi.org/10.1016/j.jsis.2019.01.003
Summary of this study
This comprehensive review examines the nature and implications of digital transformation across organizations. It builds an inductive framework highlighting how digital technologies disrupt and trigger strategic responses from companies to alter value creation while managing structural changes and barriers. The study provides important insights for workflow platforms like Tallyfy to understand the key building blocks involved in successful digital transformations.
Editor perspectives
As a workflow automation platform, we find this study highly relevant in mapping out the core elements and processes involved when organizations embark on digital transformation journeys. It gives us a holistic view of the disruptions, strategic pivots, structural changes and potential roadblocks to consider when helping our customers digitally transform their operations and unlock new value.
Warner, K., & Wäger, M. (2019). Building Dynamic Capabilities for Digital Transformation: An Ongoing Process of Strategic Renewal. Long Range Planning, 52, 326 – 349. https://doi.org/10.1016/j.lrp.2018.12.001
Summary of this study
This qualitative study explores how established firms build dynamic capabilities to enable digital transformation. Based on executive insights, it proposes a process model with nine microfoundations that trigger, enable and hinder the development of dynamic capabilities. The findings position digital transformation as an ongoing process that uses new technologies to drive agility and strategic renewal of an organization’s business model, collaboration approach and culture.
Editor perspectives
We believe the capability-building framework in this study offers powerful guidance for workflow software providers like us. It helps identify the core competencies and agile ways of working needed to help traditional organizations transform into digital-first operations. The emphasis on collaboration and culture is also key, as digital transformation extends beyond just implementing new tools.
Nambisan, S., Wright, M., & Feldman, M., P. (2019). The Digital Transformation of Innovation and Entrepreneurship: Progress, Challenges and Key Themes. Research Policy, 48, 103773 – 103773. https://doi.org/10.1016/j.respol.2019.03.018
Summary of this study
This paper examines how powerful digital technologies, platforms and infrastructures are transforming innovation and entrepreneurship. Beyond creating new opportunities, digitization has broader implications for how value is created and captured. The authors propose that research in this area should incorporate multi-level analysis, draw from multiple disciplines, and recognize digital tech’s role in transforming organizations and social relationships. Key themes of openness, affordances and generativity are highlighted.
Editor perspectives
The research agenda proposed here resonates strongly with us at Tallyfy. As a workflow digitization platform, we are at the forefront of transforming how organizations and people work. This study provides a helpful lens for examining the multi-faceted impacts of digital technologies on enabling innovation, new business models and transformed social structures. The themes of openness and generativity are particularly exciting areas to explore.
Berman, S., J. (2012). Digital Transformation: Opportunities to Create New Business Models. Strategy & Leadership, 40, 16 – 24. https://doi.org/10.1108/10878571211209314
Summary of this study
This paper explains how companies seeking opportunities in an era of constant customer connectivity focus on reshaping customer value propositions and transforming operations with digital technologies. Developing new capabilities for flexibility and responsiveness to fast-changing customer needs is key. Engaging customers at every point of value creation through digital collaboration accelerates innovation. Optimizing the entire value chain around customer engagement points is what differentiates customer-centered businesses.
Editor perspectives
As a workflow platform focused on operational excellence, the insights here are spot on. We enable organizations to digitize and optimize their end-to-end processes to become more agile and responsive. Putting the customer at the center and leveraging digital technologies to create seamless customer interactions across the value chain is the winning approach. We strive to help businesses achieve that vision.
Matarazzo, M., Penco, L., Profumo, G., & Quaglia, R. (2021). Digital Transformation and Customer Value Creation in Made in Italy SMEs: A Dynamic Capabilities Perspective. Journal of Business Research, 123, 642 – 656. https://doi.org/10.1016/j.jbusres.2020.10.033
Summary of this study
This study examines the impact of digital transformation on customer value creation in Italian small and medium enterprises (SMEs) across the food, fashion and furniture industries. Using multiple case studies, the authors show how digital tools help SMEs innovate their business models, creating new distribution channels and ways to deliver value to customers. Sensing and learning capabilities are found to be key triggers for successful digital transformation in these traditional sectors.
Editor perspectives
We find this study highly applicable, as many of our customers at Tallyfy are SMEs looking to leverage digital workflows to transform their businesses. The cases here demonstrate the power of digitization in enabling even the most traditional industries to redefine their business models and customer value propositions. The importance of fostering sensing and learning capabilities to drive digital transformation is a crucial takeaway.
Schallmo, D., R., A., Williams, C., A., & Boardman, L. (2017). DIGITAL TRANSFORMATION OF BUSINESS MODELS — BEST PRACTICE, ENABLERS, AND ROADMAP. International Journal of Innovation Management, 21, 1740014 – 1740014. https://doi.org/10.1142/s136391961740014x
Summary of this study
This paper aims to clarify the definition of digital transformation and introduce a structured approach with phases, activities and results for transforming business models. Based on a literature review and practical examples, the authors find that while digital transformation is a widely known concept, a clear approach for business model transformation is lacking. They propose a phased roadmap and identify key enablers for successful digital transformation of business models.
Editor perspectives
Providing a clear framework for business model transformation is immensely valuable for a workflow platform like ours. We’re in the business of enabling organizations to digitize and transform their processes and operations. Having a structured approach and methodology to guide that transformation is a key value-add we can provide. The best practices and lessons shared in this paper will no doubt enhance our offerings.
Chanias, S., Myers, M., & Heß, T. (2019). Digital Transformation Strategy Making in Pre-Digital Organizations: The Case of a Financial Services Provider. Journal of Strategic Information Systems, 28, 17 – 33. https://doi.org/10.1016/j.jsis.2018.11.003
Summary of this study
This in-depth case study examines how a European financial services provider formulated and implemented a digital transformation strategy. The findings reveal that digital strategy making represents a break from traditional IS planning approaches and exemplifies a new extreme of emergent strategy making. The authors conclude that a digital transformation strategy is continuously in the making, with no foreseeable end, characterized by a highly dynamic process of iterating between learning and doing.
Editor perspectives
The notion of emergent and iterative strategy making resonates with our experience in helping organizations navigate digital transformation. As a workflow software provider, we’ve seen how the most successful transformations unfold as an ongoing journey of experimentation, learning and adaptation. This study validates our view that digitization is not a one-time event but a continuous process of evolving capabilities and ways of working.
Frank, A., G., Mendes, G., H., d., S., Ayala, N., F., & Ghezzi, A. (2019). Servitization and Industry 4.0 Convergence in the Digital Transformation of Product Firms: A Business Model Innovation Perspective. Technological Forecasting & Social Change/Technological Forecasting and Social Change, 141, 341 – 351. https://doi.org/10.1016/j.techfore.2019.01.014
Summary of this study
This paper develops a conceptual framework connecting the concepts of servitization and Industry 4.0 from a business model innovation perspective. The authors propose a matrix of nine possible configurations based on three levels each of servitization (smoothing, adapting, substituting) and digitization (low, moderate, high). These configurations, supported by case examples, range from manual to highly digitized and Industry 4.0-enabled services. The study discusses the varying complexity of implementing these service-oriented, digitally-driven business model configurations.
Editor perspectives
The servitization-digitization matrix presented here offers an insightful framework for a workflow platform like Tallyfy to articulate the digital transformation options available to product firms. As our customers explore new service-based business models, this gives us a clear way to position the enabling role of digital workflows across the spectrum from basic to advanced servitization. It highlights the exciting possibilities in an Industry 4.0 future.
Ulaş, D. (2019). Digital Transformation Process and SMEs. Procedia Computer Science, 158, 662 – 671. https://doi.org/10.1016/j.procs.2019.09.101
Summary of this study
This paper examines the factors affecting digital transformation in small and medium enterprises (SMEs), which play a vital role in the economy. Digital technologies like cloud, AI, IoT, robotics, and 3D printing are transforming all aspects of business from production to management. The author describes the digital transformation of manufacturing SMEs in Turkey and the tools they can use to benefit from digitization. Empirical studies show SMEs exhibit erratic ICT investment behaviors and need external support to integrate digital technologies into firm strategy.
Editor perspectives
SMEs are a core customer segment for us at Tallyfy and this paper sheds light on both the opportunities and challenges they face in digital transformation. The array of digital technologies available can be overwhelming for smaller firms to navigate. As a workflow digitization partner, we have an important role to play in guiding SMEs to invest in the right capabilities and build digital roadmaps aligned with their business strategy.
Feroz, A., K., Zo, H., & Chiravuri, A. (2021). Digital Transformation and Environmental Sustainability: A Review and Research Agenda. Sustainability, 13, 1530 – 1530. https://doi.org/10.3390/su13031530
Summary of this study
This systematic literature review identifies the disruptions driven by digital transformation in the environmental sustainability domain. The authors present a framework outlining the transformations in four key areas: pollution control, waste management, sustainable production, and urban sustainability. Each area is further divided into sub-categories. The paper proposes a future research agenda spanning organizational capabilities, performance, and digital transformation strategy in the context of environmental sustainability.
Editor perspectives
Sustainability is a topic of increasing urgency and we believe digital technologies have a huge role to play in enabling sustainable practices. As a workflow software provider helping organizations digitize operations, we have an opportunity to support and measure sustainability outcomes. This study gives us a comprehensive view of the possibilities to drive environmental impact across industries. We’re excited to potentially contribute to this emerging research agenda.
Glossary of terms
Digital transformation
Digital transformation refers to the strategic adoption of digital technologies to fundamentally change how an organization operates and delivers value to customers. It’s an ongoing process of leveraging technologies like cloud, artificial intelligence, big data, and the Internet of Things to create new or modify existing business processes, culture, and customer experiences.
Business model innovation
Business model innovation involves fundamentally rethinking and redesigning the way a company creates, delivers and captures value. In the context of digital transformation, it often means leveraging digital technologies to enable new revenue streams, distribution channels, product offerings or ways of interacting with customers and ecosystem partners.
Dynamic capabilities
Dynamic capabilities refer to an organization’s ability to continually adapt, reconfigure and renew its resources and competencies in response to a rapidly changing environment. In the digital age, key dynamic capabilities include the ability to sense and seize new technological opportunities, learn and iterate rapidly, and orchestrate internal and external resources to transform the business.
Servitization
Servitization is the process of transforming from a product-centric to a service-centric business model. It involves developing the capabilities to provide value to customers through services related to a product, rather than the product itself. Digital technologies are enabling advanced forms of servitization by enhancing the ability to monitor, control and optimize product performance.
Industry 4.0
Industry 4.0, also known as the Fourth Industrial Revolution, refers to the trend towards automation and data exchange in manufacturing technologies. It includes cyber-physical systems, the Internet of Things, cloud computing and artificial intelligence. The goal is to create “smart factories” with modular, efficient and automated manufacturing processes.
