The world of consulting is often associated with truckloads of jargon. Similarly, the world of technology is no stranger to its own stream of techspeak.
And when the two worlds collide, they can often make simple concepts appear arcane.
Today, let’s simplify one such concept – digital transformation consulting.
What Is Digital Transformation Consulting?
Digital transformation consulting refers to services designed to continuously evolve organizations so that they can hit their goals in an increasingly digital environment.
The best way to understand digital transformation is to not think of it as a separate phenomenon or discipline. It’s simply a phrase used by the industry to describe a typical organization’s efforts to adapt to digital technologies affecting their business.
And it’s driven by two primary business instincts – fear of being obsolete and the desire to kill competition.
What Are the Four Areas of Digital Transformation Consulting?
A better way to understand digital transformation consulting than a traditional definition is to explore its 4 major components:
- Product – Creating digital products that solve problems either for the employees or customers. For example, creating a mobile app for a local business to engage customers directly. An effective digital transformation consultant doesn’t just tell organizations how to build digital products but also drives the implementation.
- Process – Creating internal processes that can help organizations sustain innovative projects. For example, coaching teams in agile software development so that they can drive continuous improvements based on user feedback.
- Platform – Putting structures in place for organizations to scale their operations digitally. For example, transitioning to cloud environments from on-premises data centers.
- People – Elevating the skill set of the team to own and drive digital transformation themselves. Unlike traditional consultants, successful digital transformation consultants don’t focus on creating client dependencies. Instead, they successfully hand-off projects so that the organizations can tackle them on their own.
What Do Digital Transformation Consultants Do?
Now that we know the four main areas of digital transformation consulting, what does an actual consulting engagement look like? What do digital transformation consultants do?
The answer depends on your business requirements. Most engagements start with an audit. The consultants will carry out an assessment to understand where your organization is, what it wishes to achieve, and suggest how to do so.
For example, if an organization wants to upgrade its security infrastructure, the consultants would first investigate the state of the existing systems and then share actionable recommendations in a report.
The next stage is where digital transformation consultants differ from traditional consultants.
While most traditional consulting engagements end with recommendations, effective digital transformation consultants possess the expertise to execute the recommendations. Digital consulting firms are not just analysts and consultants, but designers, marketers, engineers, project managers, etc. They are experts at rapidly deploying and scaling digital solutions for their clients.
What Does Digital Transformation Look Like?
Since 2000, 50% of Fortune 500 has either gone bankrupt, ceased to exist, or been acquired.
This would have been unfathomable in the 20th century when the size of an organization alone gave it long term security. In the 21st century, every company carries the risk of being obsolete.
Five of the world’s top ten companies are less than 25 years old.
While new companies, backed by the latest technologies are disrupting traditional players, there are also enough examples of traditional organizations successfully reinventing themselves through digital transformation.
In the 2010s, after leveraging data from multiple digital sources, Hasbro realized that it’s not the kids that they should be targeting but parents, who after all make the purchase.
By banking on nostalgia and utilizing omnichannel marketing, Hasbro created a series of targeted marketing campaigns and considerably boosted its budget. Within a few years, Hasbro hit $5 billion in sales for the first time in its history.
In 2015, two popular multiple listing services, MRIS, and TREND decided to revolutionize the fragmented MLS industry by merging together to form Bright MLS.
Bright MLS wanted to drive revenue with new products, reduce customer support calls, and seamlessly merge MRIS and TREND’s vastly different customer bases. It embarked on a digital transformation journey centered around its UX (user experience) practices.
Bright developed a new application to help real estate agents, tweaked the UI of one of its products to reduce customer support calls, and embraced rapid prototyping with lean validation.
In the end, Bright cut $600,000 in costs, increased its revenue, and developed an appreciation for the strategic impact of UX on its business.
Why is Digital Transformation Suddenly Important?
In other words, digital transformation isn’t a sudden phenomenon. Businesses have always had to adapt to changing technology. It’s just that the pace of technological change has accelerated so much that businesses can’t afford to stand still. They need structural changes to make digital transformation a part of their culture.
Selecting the Right Digital Transformation Consulting Partner
Digital transformation includes a wide range of projects. Some are tech-heavy while others might be more focused on processes or people. The first step in selecting the right consultant is defining your challenge as specifically as you can. There are different consultancies that specialize in different areas of digital transformation such as marketing, engineering, process, etc.
When evaluating a prospect, pay attention to the following indicators:
- Existing clients served by the firm – Has the consultant previously led digital transformation at renowned companies?
- Official partnerships with leading technology companies – Do top B2B tech companies trust the consultant to introduce their products?
- Background of the founders – Do the founders have experience in technology and product development?
- Team specialization – Does the team include engineers, designers, and product experts? Is it global or concentrated in one place?
- Client reviews on Clutch and employee reviews on Glassdoor – How have the clients rated the consultant? Are the employees happy with their work?
If you’d like to learn more about the impact of digital technologies on your business, talk to a Modus consultant. Modus Create has helped some of America’s leading organizations such as Burger King, Kaplan, PBS, and AARP transform for success in the digital future.