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What is Digital Transformation and Why Does it Matter to SMBs?

Matt Freymiller
11/11/2020
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In a nutshell, digital transformation is the migration of manual and often time-consuming tasks and processes into a digital format. But it’s also much more than that.

 

Digital Transformation Defined

If all you do is digitize your current processes, you’re taking a broken process and just doing it faster.

 

The real magic of digital transformation comes not from the “digital” part, but the “transformation” part. As you begin to digitize a process, you should evaluate that task, looking for any opportunities to simplify it, automate it and transform it to make it easier.

 

When you look closely at a particular process within your business, there may be a lot of steps involved that are no longer required. By evaluating that process, you’ll discover unnecessary steps you can remove – and that can bring many benefits to your organization, your clients and your employees.

 

How It Works – An Example

Think about your procedure for processing invoices. One person maybe opens the invoice and highlights the amount owed and the invoice number. Next they hand it over to someone in management for approval. Then the invoice goes to the CFO or bookkeeper who makes the payment.

 

If all you do is scan that invoice into a PDF and email it around the office, you may have made the process digital, but the process itself remains the same. You haven’t really improved anything.

 

Digital transformation is about using technology to streamline, simplify and otherwise improve cumbersome tasks.

 

Going back to the invoice example above, you can incorporate tools into the process that automate part or all of that process and create a lot of efficiencies. You could use a solution that evaluates your invoices and applies rules to the process. As an example, any invoice under $50 is automatically paid, but over $50 needs approval.

 

Digital transformation isn’t just for internal processes. You can also improve customer-facing processes. Amazon is a great example of this. They’ve digitized their order workflow so you’re updated on your order’s status at every stage in the process. From the second you hit the “buy now” button, Amazon tells you exactly where your order is and when it will arrive.

 

Digital Transformation Advantages for SMBs

Not only does digital transformation make work more enjoyable for your employees, but it also creates a better experience for your customers.

 

Quality employees are hard to come by. I hear that from almost every organization I talk to. By engaging in digital transformation, you can minimize the number of employees that you need. You can also make your employees’ workdays more rewarding by allowing them to focus on higher value tasks.

 

By digitally transforming simple tasks and processes, they become faster and more repeatable. Once your employees don’t need to spend time on those mundane activities, they’re free to focus on work that provides greater benefits to the company and gives them greater job satisfaction.

 

On the flip side, your customers will be more satisfied because they’ll receive a more consistent experience from your organization. Think about McDonald’s. No matter which McDonald’s you go to, you know you’re going to have the same experience.

 

When you apply digital transformation to your customer-facing processes, your clients have the same experience time and time again. Customers like that. They like knowing that if they call you and have a need, they can depend on you to fulfill that need in a predictable way. This allows you to meet and exceed your customers’ expectations.

 

Even Small Changes Can Make Big Differences

You may think digital transformation is time-consuming, too expensive and more than a little intimidating – especially for smaller organizations. But it doesn’t have to be.

 

You can start with something simple and then build on that success moving forward. A great place to begin is with mileage reporting. Nobody likes mileage reporting. Traditionally it’s a manual task, there’s paperwork involved, and approvals are required. This is the perfect candidate for digital transformation.

 

Microsoft has a tool called MileIQ that’s included with many of the Microsoft 365 subscription levels. It’s also available as an inexpensive monthly subscription. MileIQ runs on your or your employees’ phones. When you start driving, MileIQ detects and tracks your drive. It records your mileage and can show on a map where you started and finished. From there, it can automatically generate a report that can be fed into an HR or payroll system that calculates the mileage and reimbursement.

 

At the very least, using a tool like MileIQ gets your employees away from having to fill out a paper form or spreadsheet. At best, the entire process could be automated.

 

Tools like MileIQ make it easy to dip your toe into digital transformation without sinking thousands of dollars into a product. And you’ll start enjoying the benefits very quickly, which can build momentum to continue improving processes.

 

We help businesses with digital transformation every day. If you’d like to learn how to transform your organization through the power of technology and process improvement, let’s talk.

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