The cross-industry need for digital transformation (DX)
According to our 2022-2023 State of Digital Adoption report, 67% of enterprises are under “incredible pressure” to accelerate digital transformation (DX).
What is DX?
Simply put, digital transformation is the implementation of tech systems to maximize efficiency and productivity while delivering business value and driving innovation. Further benefits include that it:
- Improves organizational efficiency
- Boosts employee productivity
- Limits costly human error
- Raises customer and employee satisfaction
- Increases cross-enterprise agility
- Provides access to valuable enterprise data
- Enables scalable training & onboarding
For detailed insight into DX, including its role in various industries, visit our glossary page here.
Enterprises that achieved digital transformation
When trying to make a change, it’s always helpful to review some examples of success stories. Here are three noteworthy digital transformations by major enterprises to gain inspiration from. Keep reading to learn how these companies did it.
Comcast
Comcast innovated new products including voice-activated controls and a cloud-based video platform for watching TV. However, this didn’t result in the boost in customer satisfaction they expected. So, citing the “accelerated adoption of digital technologies brought on by the pandemic”, the $84-billion U.S media and communications company reorganized, putting product innovation and customer experience together.
With this transformation, the company was able to create a highly personalized experience that uses machine learning to recommend content. Additionally, Comcast tracked the impact of their offerings through IT investments, customer care, technology usage, and accounting to ensure a smooth and cost-effective customer experience.
This example shows how basing digital transformation on the customer experience lets companies understand and address all their touch-points and how they interact with their audiences—from the marketing campaigns they see, to the sales personnel and processes they encounter, and to where they first connect with a company.
Netflix
Where Blockbuster went wrong, Netflix went right. Netflix based their digital transformation strategy on the customer.
Netflix, who originally began with a business model based on direct mail, unlocked their superpower potential when they moved to a cloud-based, on-demand model. Even before that, with a focus on the customer experience, they deployed an online recommendation engine to help customers find shows they like based on their interests and tastes and let customers know which videos were out of stock—meaning they could avoid going to video rental stores altogether.
In 2002, Netflix had 857K subscribers and $152.8M in revenue. In 2019, they had 151.5M subscribers and $15.794B in revenue. Their biggest competitor in 2002, Blockbuster, tried to protect its bottom line with tactics like late fees, but this ultimately garnered hostility, was disliked by customers, and the rest is history.
Nike
When Nike felt they were getting a bit dated and sluggish, they underwent a digital transformation. Nike transformed the company’s mindset, supply chain, and brand to better connect with its customers during the pandemic.
The brand focused more on data analytics, updated their e-commerce strategy, developed stronger digital marketing campaigns, and amped their direct-to-customer sales. The brand took production capabilities in-house to allow for market agility and invested in robotics as well as 3D printing.
With this, Nike was able to open concept stores, create more membership opportunities, and improve the overall customer experience by using digital consumer data more effectively alongside an omni-channel approach.
Nestlé
The largest public food company in the world, Nestlé underwent a major digital transformation in order to enable advancement and scaling within the enterprise. The strategy they followed was named ‘Vision2Life’, and its purpose was to:
- Bring value to receivers of IT services
- Main global synchronization while operating locally
- Merging product management and business stakeholders
- Made the IT department an innovator, not just a service provider
In Nestlé’s annual investor report, they stated that the changes were about creating business value driven by data and technology. Their goal? To create an exceptional customer experience through engagement and more efficient operations. The conglomerate strives to achieve this using future-forward technologies, including AI.
In their words, Nestlé will achieve this by “creating channel-less ecosystems, advancing always-on analytics, expanding connected operations, and supporting sustainability”.
Discover how Nestlé partnered with WalkMe to boost employee digital adoption and drive organizational transformation.
Spotify
In order to provide superior customer value and scale internally, Swedish streaming platform
Spotify shifted their focus to customer engagement metrics and their internal structure. Having seen success from expanding their offerings – from just music to adding podcasts, live audio, and audio books – the enterprise knew that further transformation couldn’t hurt.
In the first phase of the plan, Spotify took their team structure back to the drawing board.
Having reworked it entirely, they ended up with an organizational layout that created a culture that rewards creativity and experimentation.
Each product within the Spotify ecosystem is owned by a team made up of individuals with varying expertises. This structure allows diverse skill sets to come together, resulting in exceptionally well-designed products that enhance user experience – the cornerstone of successful digital transformation.
Sephora
In 2015, beauty store extraordinaire Sephora made a serious commitment to innovating when they turned one of their warehouses – previously a test site for retail stores – into a digital transformation hub. The hub was dedicated to developing digital solutions that would create seamless customer experiences across physical and online spaces.
On top of their innovation lab, Sephora released a myriad of new offerings including:
- The Pocket Contour app, which provides contouring tutorials based on users’ individual face shapes
- Beacon-driven (IoT location-based broadcasting devices) notifications to provide on-time and personalized notifications to in-store customers
- Sephora Flash for ultra-fast, free shipping
- Virtual Artist app (2016), which uses augmented reality (AR) to let users try on makeup virtually before buying
In the digital space, Sephora added features such as AI-driven chatbots that enable users to book appointments and the ability to effortlessly find and buy makeup tested using Virtual Artist on the Sephora app and website.
The result of all of these introductions was a frictionless, personalized customer experience thanks to a true omni-channel experience.
UPS
In a bid to improve customer experience, courier company UPS has designed a comprehensive digital transformation strategy. In fact, digital transformation is not new to the company. Having invested for decades in technology and IT infrastructure, UPS was able to maintain an incredible on-time delivery rate throughout the COVID-19 pandemic – even when industry rates dropped.
In 2018, it was announced that UPS would invest $20B into e-commerce. A large part of that sum has gone to data and analytics command centers featuring IoT sensors, cameras, and Network Planning Tools (NPTs). These technologies allow the company to track the whopping two million packages processed per day in their facilities. Additionally, UPS rolled out ‘ORION’ – “on-road integrated optimization and navigation”, a fleet telematics system using advanced algorithms to constantly optimize delivery routes based:
- Distance
- Fuel
- Time
- Environmental impact
The result of all these initiatives? 90% of Americans are now experiencing a reduced delivery rate of 3 days or less and experience significantly less mixups.
Key takeaways
What we have learned from how Comcast, Netflix, Nike, Nestle, Spotify, Sephora, and UPS achieved digital transformation is that a customer-centric approach is the key to success. Each of these enterprises strayed from the traditional business model that follows a typical ‘spray and pray’ approach – mass production and mass distribution. However, the other element shared by these companies’ digital transformation journeys is data.
All seven enterprises highlighted provided their employees with copious amounts of customer data and implemented systems that improved their workflows. This goes to show that digital transformation begins when employees are empowered with systems and technologies that enable new levels of efficiency. Additionally, following the changes they made to their business models, each of these enterprises experienced significant data-fueled growth based on exceptional user experience.
To learn how WalkMe helped our customers achieve successful digital transformation, explore our customer stories.
