Know The Different Tiers of Digital Transformation to Consider for Your Business

1. Know The Different Tiers of Digital Transformation to Consider for Your Business Digital technologies are playing a significant role in the modern economy and digital business transformation. However, digital transformation without a proper implementation strategy can bring hurdles in the business’s success journey. Inadequate evaluation of the offerings of digital technologies makes organizations assume that any application of cutting-edge digital technologies will lead to successful digital business transformation. As a result, many enterprises make impromptu business decisions about the utilization of digital technologies and it becomes difficult for them to maintain competitive parity, despite making substantial business investments. It is recommended to hire experts for professional digital transformation services to ensure a successful digital transformation journey. To help you understand the full value that digital technologies can offer, here are four examples, each of which focuses on the strategic benefits available at different tiers of digital transformation. Which Tier is Suitable for Your Company? Before investing in digital transformation services, it is important to create an effective digital transformation strategy. To define an optimal digital transformation strategy, you need to evaluate your requirements to engage at each of the four tiers of digital transformation and then think of making investments that will help you unlock the advantages of interactive data and digital ecosystems. First Tier This tier is a must as almost all companies can leverage the benefits of operational efficiencies. The majority of digital business transformation

2. initiatives are made in the first tier. For example, firms such as oil and gas run oil wells, refineries, and pipelines that need substantial investments; improvement of operational efficiency is a must. If these organizations adopt use IoT devices and AI to locate reserves and to maintain pipelines and refinery assets, they can save about 60% of their operational costs. Major challenges encountered in this tier involve the installation of extensive interactive data generation in asset utilization and breaking data distribution silos. Second Tier The second tier is essential for companies selling products that can access interactive data from users, which can be leveraged for the strategic benefit that exceeds what’s available in the first tier. The second tier is the end if existing product-user interactive data is not open for revenue-generating services. Most of the consumer goods come under this category. The main use of interactive data in these businesses is to enhance efficiency in advertising or product development. Third Tier This tier is for firms who want to generate data-driven services from products and value chains. Such companies must augment their production ecosystems to extend their strategic advantage from business operational efficiencies to new data-driven services. In the third tier, companies start using data not only for operational efficiencies but also for revenue generation. The third tier is the final stop if your company does not have access to a consumption ecosystem. Fourth Tier The fourth tier is strategically essential for any company whose products have evolving consumption ecosystems. Companies that remain within their

3. production ecosystems in such scenarios are at the risk of being commoditized. Their main challenge is extending products into digital platforms. Final Thought It’s obvious that not every company will want or afford to engage in all of the four tiers of digital transformation mentioned above. Some may choose to focus on one or two. However, every company must constantly strive to tap into new opportunities. Investing in digital transformation services that utilize a comprehensive strategy, considering the above-mentioned tiers, will help you provide value to business value to your customers.