If you want to modernize your business while saving money and running more efficiently, digital transformation should be your goal. Digital transformation refers to a state where a company has successfully replaced every outdated analog process with a more effective digital alternative. Since new technologies are always coming out and displacing old ones, digital transformation is something of a moving target. Still, it’s a worthwhile long-term goal for any business that wants safer record storage, easier file access, and better data analysis.

While undergoing a complete digital transformation can be a long and involved process, getting started is simple. In this guide, we’ll walk you through the terminology, tools, and strategies you need to kickstart a digital transformation at your company. We’ll also provide some practical examples of the process across a variety of industries. Once you know all the steps that go into a successful digital transformation, you’ll be able to apply the same principles to your business.

What is digital transformation?

In simple terms, digital transformation is what happens when a business replaces all of its analog processes with digital ones. A more complete digital transformation definition requires some more background information, though.

Digital transformation depends on two related but distinct concepts: digitization and digitalization.

Digitization vs. digitalization vs. digital transformation

• Digitization refers to the conversion of analog data into digital data. If you’ve ever scanned a physical piece of paper to your computer, you’ve digitized a document. If you converted your old family videos on physical tapes to .MP4 or .MOV files, that’s another example of digitization. In a business context, digitization is usually the foundation for digitalization and digital transformations.
• Digitalization means transforming analog processes into digital ones. Switching from a paper sign-in sheet to an online calendar would be one example of how you might digitalize a process. Digitization is just one part of digitalization. Others include choosing the technology you’ll use to facilitate the digital transformation, defining these new processes, and choosing which employees will execute it.
• Digital transformation is the culmination of a digitalization project, where most (if not all) of a company’s workflows are digital rather than analog. Since every company needs different resources and technologies, no two digital transformations will look exactly the same. Furthermore, a digital transformation never ends, as agile companies tend to keep an eye on new technologies.

Digital transformation tools

To undergo a digital transformation, businesses must first digitize their important paperwork and digitalize their most important workflows. The exact tools for the job will vary from company to company, but most businesses can start the process with some intuitive hardware and software:

• Document scanner: While you can manually type up all of your physical records, using a document scanner is much faster and easier. ADF scanners can digitize hundreds of documents per minute, or thousands per day.
• Scanning software: By default, scanning paperwork just turns it into an image file. Robust scanning software, such as RICOH PaperStream Capture, uses optical character recognition (OCR) technology to turn scanned text into editable, indexable, searchable digital files. Good software can also sort files and extract data automatically.
• Cloud storage: Easily accessible digital files are the backbone of a digitally transformed company. Rather than storing files on a local server, invest in a cloud storage service such as Google Cloud Storage or Microsoft OneDrive. A cloud scanner can speed up this process.

Digital transformation benefits

It’s not easy to incorporate new technology into long-established workflows and transform processes across the business. However, digital transformation’s benefits far outweigh the initial costs and time investment:

• Reduced costs: When done right, a digital transformation can save your organization a significant amount of money. Streamlined processes mean your employees will be more efficient at their jobs. You’ll also reduce costly transcription mistakes that would otherwise take time and resources to correct.
• Improved workplace culture: Employees generally appreciate when they can focus on work that really matters. Removing the more tedious parts of their day-to-day work can result in higher employee satisfaction and a happier work environment.
• Better customer experiences: Your organization will be able to respond to customer needs faster and more reliably. Plus, your customers will be able to access the information they need when they need it.
• More accurate insights: When all of your information is available digitally, you can do much more with it. AI and machine learning-powered analytics tools may allow you to discover insights into customer histories and long-term trends. That will help you make more informed decisions.

How to create a digital transformation strategy

Making the digital leap isn’t easy, especially if your organization relies on legacy processes or systems. It’s not an impossible challenge to overcome, though. All you need is a strategy that will help you assess your needs, set and align goals, and roll out changes when they’re ready.

We’ve created a step-by-step guide to walk you through the digital transformation process. While you may have to modify some of the individual steps, the general advice should be suitable for most businesses:

1. Get buy-in from key stakeholders: Gather all the people who will approve the transformation process, including executives, board members, department heads, or investors. Getting buy-in from these individuals will help set expectations and reduce friction when making critical decisions.
2. Define success and set attainable goals: What does success look like for your digital transformation? Are you looking to save time and money on a specific process? Do you want to improve accuracy and eliminate errors? Figuring out what you want from a digital transformation will guide you toward the best solutions and processes to meet those goals.
3. Build your digital transformation team: Gather people who are knowledgeable enough about their subject matter experts who know which areas of the business are ripe for transformation. You may also want to bring on an external consultant to help spearhead this process, as they can be more objective about what’s working and what’s not.
4. Use the right tools: Digital transformation efforts take many forms, and the right tools will depend on the type of files you need to convert. For example, documents and photos require a scanner that can capture information and image detail and replicate them accurately in a digital format. CDs and video tapes require separate players and readers in order to convert those formats, too. As one of the best practices, software needs to tie the entire transformation together so you can store digital assets securely and keep them organized.
5. Start small: Kicking your efforts off with a large or complex task may set you up to fail. Start with a single process that will see immediate gains when transformed. Examine it end to end, then test and implement your solution. Once it’s up and running, you can focus on another section, then another — until your transformation is complete.
6. Test digital processes and implement feedback: Trying out your solutions in real-world conditions will help you find out what elements of your transformation are working well and which have created new bottlenecks. Survey your employees who work with these new processes and find out where the issues are. Also, compare the new workflows to older ones to make sure you’re actually saving time and effort.
7. Scale digital transformation strategy to other business areas: Once you’re satisfied with the results of your digital transformation pilot project, it’s time to scale. Look for other opportunities where you can see immediate gains and apply the knowledge you’ve learned here to these new projects. Continue expanding outward until you can transform the rest of your organization.

Digital transformation challenges

Every organization must overcome several obstacles on the road to digital transformation. The following are a few common challenges and ways you can address them.

• Data security: When storing sensitive physical documents, you’ll likely need to lock them away in a file cabinet and store them in a secured location. Digital data requires a similar vigilance toward keeping security. Data must be encrypted in transit and at rest to prevent malicious actors from accessing it. Also, look for systems that offer identity and access management tools to ensure employees only have access to the bare minimum that they need to do their jobs.
• Internal resistance: Change can often be met with resistance. If your employees aren’t on board with these new digital processes, your systems won’t operate as efficiently as possible. Rather than pushing changes onto employees, consider bringing them into the process. Offer in-depth training and informational sessions designed to address concerns and explain the benefits so employees can also buy into these changes.
• Technical debt: Many organizations continue to use legacy systems and outdated processes. After a digital transformation, these older systems may cause problems if they are not addressed. As you develop your digital transformation strategy, look for opportunities to invest in new solutions to try and pay off technical debt where you can to prevent problems from cropping up in the future.

How to build a digital transformation framework

Once you’ve developed your transformation strategy, you need a framework to help you see it through to the end. This framework will allow you to design a transformation infrastructure with the best performance once everything’s up and running. It will also help you manage the impact of process changes to overcome old habits.

Your framework will need at least three key components:

• The people who monitor the digital transformation process through every step. They should work with key stakeholders to reduce the likelihood of red tape impeding progress.
• A process that includes workflow meetings to keep stakeholders up to date. Use this time to answer tough questions about how the transition will impact day-to-day operations.
• The tools needed to track progress. These include survey tools to gauge employee sentiment. You can also use value capture models to provide concrete results of its outcome.

As you replace tried-and-true processes with experimental ones, you’ll also need to get your workforce on board. There are a few strategies you can try to help your employees embrace your company’s digital future:

• Designate digital transformation role models: People are more likely to adopt new ideas or technology if they see people they trust doing the same. Find eager individuals, whether they’re members of leadership or coworkers. Then, give them space to instruct and inform others about the digital transformation process.
• Give employees opportunities to learn: When your organization offers opportunities to learn about new technologies or processes in a safe and blame-free zone, employees are more likely to build confidence in their skills.
• Reinforce positive results: Congratulate employees who take a shine to new processes. Use incentives to encourage them to help others to do the same. This creates a positive feedback loop pointed toward your end goals.

What are digital transformation services?

Digital transformation services are outside companies that can evaluate your current workflows and recommend practical digital upgrades. You may want to hire one of these companies if your business is large or especially dependent on analog workflows.

For instance, if you have questions about digital transformation solutions for your business, a consultant may have the answers. Consider hiring a dedicated partner to help you through the transition as cleanly as possible. A consultant or service can help you build a digital platform that customers can use with ease. Plus, these professionals can apply their expertise to help identify issues before they arise. That could save your effort and time in the long run.

When researching digital transformation services, look for companies that:

• Prioritize your business needs: Focusing on your industry and how your particular business works will help you narrow down your choices. For instance, if you work with sensitive data, look for a consultant that specializes in data lockdown.
• Work with concerned employees: Your staff members may say they liked the old way of doing things, since they knew how it worked. An empathetic consultant or agency can help them keep a long-term view in mind as they deal with growing pains.
• Listen to your staff: Let employees share problems, ask questions, and vent frustrations. The workers who deal with your systems every day are often the best subject matter experts you could ask for. Look for a digital transformation service that takes their concerns seriously.

Digital transformation examples from different industries

Digital transformation can benefit almost any business, not just tech-focused ones. From restaurants to government offices, any organization that deals with record-keeping, payment processing, or customer communications can benefit from going digital. Consider these digital transformation examples:

1. Restaurants: The digital transformation of the restaurant industry has had a huge impact on food supply chains. GPS and digital calendars keep the delivery of raw materials on-track, resulting in less food waste.
2. Retail: Online shopping has forced small retailers to find new ways to do business. Some have success with "hybrid" shopping experiences, which are fully online but also have stores or showrooms for customers who prefer the hands-on experience.
3. Manufacturing: Centralized document workflows in manufacturing makes it easier to keep important info, such as safety notices, consistent across locations. It also reduces the need to keep paper documents in areas with heavy machinery. Instead, workers can find all the info they need on tablets or other devices.
4. Medicine: The recent digital transformation in medicine has changed how patients are seen and diagnosed. Doctors, dentists, and other medical professionals have digitized everything from appointments to files for more efficient check-in and check-out processes. Accessing health records and test results from online portals helps patients stay involved in their own care, too.
5. Supermarkets and grocery stores: Store pick-up is the fastest growing form of grocery e-commerce. That’s sending more customers to grocery apps and websites. Meanwhile, that growth improved data sources from user’s shopping habits and store supplies allow for more efficient ordering.
6. Finance: The steady advancement of financial tech ("fintech") has given businesses more ways to manage their money online. It’s contributed to greater data accuracy, which means financial institutions can make better decisions on loans and credit. On the consumer side, people can handle the vast majority of their needs through apps or websites. If they need to deposit a check, they simply use their smartphone camera.
7. Government: The federal government is currently working toward smoother, more unified digital systems. Better accessibility and usability will let private organizations work with the government more effectively. Digital, centralized recordkeeping among agencies will also enable better collaboration and reduce bottlenecks for both public servants and citizens.

Our Recommendation: RICOH fi Series Scanners

Digitization is usually the first step toward a digital transformation. Before you digitalize your workflows, you probably have thousands of physical documents that you need to scan, sort, and index. A RICOH fi Series Scanner can help you complete this process in weeks rather than months. For example, the RICOH fi-8170 offers double-sided scanning at 70 pages a minute, which can significantly speed up the digitization process.

Our OCR scanners ensure that your text is ready to edit as soon as you scan it, while our network scanners allow your whole office to collaborate on digitization initiatives. Contact us to learn more about how our scanners and scanning software can help your business digitize, digitalize, and ultimately undergo a full digital transformation.

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