What is Digital Transformation Anyway and Where Do I Start?
I work with many SMB companies that are not against digital transformation; in fact, they are for it and see technology as the logical solution to commerce distancing. The issue for these SMBs, due to their size and CapEx constraints, they have not built a wealth of internal IT talent to draw upon. As such, many of them ask me, “What is digital transformation and where do I start?” I tell them, as a rule of thumb, technology progresses in the following steps:
- Outsource: people, process, and product
Get out of the cost, risk, and responsibility of IT ownership and management
Example: help desk, monitoring and management, dispatch, emergency response
Solution provider type: Managed or Cloud Service Provider
- Improve: core system reliability and enhancements through application development
Increased efficiencies for greater profit
Example: website and CRM integration
Solution provider type: Application Development
- Innovate: end-to-end systems integration and specialization
Maximize system information for analytic insights for overall business improvement
Example: AI and Machine Learning Bots
Solution provider type: Application Integration Provider
- Verticalize: enterprise systems
Economies of scale to maximize profit
Example: Salesforce
Solution provider type: SaaS Providers
In theory, each step pays for the next progression because technology is a net positive and its return is improved company performance in both increased revenue and lower operating cost.
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“Nothing happens until a sale is made.” Thomas Watson, Sr., President of IBM from 1914 to 1956, coined this expression. He knew what he was talking about. Selling technology in the first half of the twentieth century, before the moon landing in 1969, was not an easy sale to make. Companies then, like many still today, did not understand the transformational power of technology to reshape industry and company fortunes.
What is a “sale” and how is it made? A sale is made when a buyer and seller agree to exchange values. The customer’s value is revenue, but what is your value to the customer? It’s not your price.
New sales are the lifeblood of every business, but not every business knows that yet. Without predictable new sales year over year, no matter how well intended a company’s mission or goals, the company will suffer with limited growth. New sales breathe life into all other company possibilities.
How to attract new customers year over year is the seminal question every business must solve first if it wants to maximize its value proposition and reach its potential.
Technology companies must monetize their value proposition to make more business. A company’s value proposition is the monetized value of its service or product to the customer - “your value.” If you don’t know the monetized value of your value proposition to your prospect, neither does he.
Sales are the problem, sales are the answer, sales are the point. Monetize your value proposition to make more sales and grow your business at scale.
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