What is business digital transformation ? Why is SME digital transformation necessary?

Enterprise digital transformation is a popular concept frequently mentioned in the business community, it represents an inevitable development trend of the current economy. In this article, let’s learn about business digital transformation and the importance of this process.

What is business digital transformation ?

Digital transformation is the application of digital technology to business activities such as business, human resource management, production, etc. to help them become more efficient and bring better results. much better value for the business. Above all, this is a common global trend in the 4.0 era, it helps businesses adapt and keep up with the strong development of technology as well as survive in the market.

Specifically, according to Microsoft, digital transformation is a business innovation driven by the explosion of cloud technology (Cloud), artificial intelligence (AI), and the Internet of Things (IoT), providing ways to new to understand, manage and transform their business operations.

Digital transformation is difficult to define precisely because it covers all different fields and industries, so it will also have its own characteristics and processes. In general, digital transformation changes the way people work, improves the model and way of working with the help of digital technology, and even affects the culture and working environment. of the enterprise. Of course, every change is for the better.

Enterprise digital transformation is not only the successful application of a method or model, but also a process of strategic change, with clear plans and goals.

What is business digital transformation

The importance of business digital transformation

This is still a concern of many businesses. But in fact, digital transformation not only makes the business more efficient, but also changes the operating mindset of managers. We will list 5 key points to show the importance of digital transformation in business.

1.   Change management thinking, organizational culture

The application of technology to operation and management requires leaders to change their thinking. For example: Managers need to be proactive and allow storing business information to a third-party cloud system, empowering employees and trusting them, overall management on the system just to grasp the situation, while avoiding losing time to directly monitor the work of employees.

Digital transformation also increases the connection between departments in the enterprise, departments can easily collaborate on the system, capture contact information of all members. This helps to increase transparency in the organization and optimize overall performance.

2.   Comfortable access to data and information

In a digital transformation business, all information and data is stored in the cloud. Thanks to that, managers can easily control, monitor and update information quickly, thereby making the right decisions for their business. At the same time, employees can also easily access data to work anytime, anywhere. The most obvious benefit of digital transformation that we can see is the work from home solution during the Covid-19 epidemic season, those companies can still operate normally in the state of isolation.

3.   Reduce operating costs

Under the impact of digital transformation, some jobs in the process and facilities will disappear, and technology will replace and fill those gaps. For example: Data and information will now be stored on a computer system, which reduces the amount of printing paper, the storage area, and saves costs in business operations. Moreover, some jobs will also disappear like clerical work, paperwork, records management… because there are softwares that take care of those things.

4.   Improve customer experience

In the era when every business is geared towards digital transformation, storing customer information is very important. Google and Facebook are strong because they own the information of billions of users. Basic information such as contact number, personal information, purchase history … is also the basis for sellers to advise exactly what customers need, providing a better product / service experience for customers. them from the customer data that the business collects and stores on the system.

In addition, digital technology also creates many platforms for businesses to communicate with their customers. Promotional information, customer care is also easily transmitted to them to create good sympathy.

5.   Increase competitiveness

Firstly, digital transformation helps businesses save operating costs and have a budget for investment and development. Second, the support of technology helps businesses achieve greater efficiency, creating a better customer experience. Those two factors will help businesses increase their competitiveness by providing products/services that match the needs of customers.

Digital transformation of small and medium enterprises

An agricultural cooperative harvested cocoa, sold cocoa for many years but always faced difficulties, challenges and market fluctuations. Then one day, there were 2 young men who were still the same ingredients that made up another story. They carefully select the finest cocoa ingredients, to make the finest chocolate bars. But they don’t sell chocolate, they sell a luxury gift. Chocolate bar wrapping paper is selected from traditional Vietnamese silk. Hand embroidered motifs on silk are designed using modern digital technology. They do not sell goods in Vietnam market first, but they choose the European and American markets first. Their business is only about 10 people but millions of dollars in revenue. That is a small and medium-sized business called Marou Chocolate in Vietnam.

Digital transformation is the transformation of thinking and perception. Similar to the above, a wood workshop can ask itself whether it is still building and selling wooden furniture as it has been for many years or will it be selling designed furniture according to the needs of the customer, allowing the customer to participate. Do you have an opinion on their furniture the way they want it, to see a 3D digital version before deciding on a choice? Small and medium enterprises just need to renew their awareness and come up with a problem. Digital technology will help.

Digital transformation of SME businesses can be faster, more economical, more efficient through the use of platforms. For example, 1Office, a general corporate governance platform of Vietnam, allows another business to use all services, from human resource management, to accounting, to sales, to tax declaration quickly, No need to invest, no technical manpower to operate, with a per capita cost of only about 30,000 VND / person / month. A small and medium-sized enterprise with 10 people only has to pay 300,000 VND/month.

Digital transformation is considered as one of the key solutions to help SMEs survive the recent Covid-19 pandemic, stand firmly in the market and the basis for expansion and sustainable development.

Hope the information Tech Town brings above will be useful to you.

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