What is Digital Transformation? Why is it important in today’s business landscape?

The modern era is about innovations where technology is becoming integral to life. With everything being digitized, companies are adopting digital transformation to survive in the competitive world. According to IDC, it is expected that the rapid rise in digital transformation will make "49% of the world's stored data reside in public cloud environments". Digital Transformation is essential for companies in the modern-day business environment to stay in the competition, enjoy workplace flexibility, increase security, and achieve valuable business growth.

However, the fear of turning digital or the digital transformation anxiety is also true, stemming from the challenges of disruption, fear of being replaced by automation, overwhelming stress, and increased demands of customers. Henceforth, companies should conduct proper research before introducing a digital culture to their workplace. Effective communication, adopting a flexible strategy, addressing the employees' fears, and focusing on one aspect at a time are some beneficial approaches when undertaking digital transformation projects.

Let's learn in the following guide more about digital transformation, its benefits, challenges, fears, and how businesses can avoid failure in adopting digital transformation.

What is digital transformation?

digital transformation

Digital Transformation is more than just a term; it is always evolving and has different applications for every organization. Thus, reducing the whole concept to a single definition would not be justified. Furthermore, the word "digital" can refer to many things. It can mean artificial intelligence to some; others may take it for data analytics, while some companies may consider going digital as opting for a paperless environment.

In simple words, digital transformation can be best described as integrating digital technology into all areas of an organization. It is to replace the old operating models with digital in today's modern business environment. As Harvard Business Review explains, digital transformation is the process of modifying a business' strategies and objectives to take advantage of digital technology's prospects. Some of the famous examples of digital transformation in the modern world are mobile applications, virtual try-ons, e-commerce websites, and even a remote-first workspace that would qualify for the concept.

Digital transformation is all about thriving in the modern age and making use of growing innovations—digital technologies—to boost productivity, increase efficiency, and embrace the digital culture. However, it is also important to note that digital transformation doesn't simply mean replacing old methods with digital technologies. Such a transformation doesn't happen overnight and may take several months, even years, depending on your business strategy. In general, opting for digital transformation should be to experiment with what works best for your business and get comfortable with how you operate and deliver optimum value to customers.

Benefits of Digital Transformation


The shift from the traditional roles in a company to digital can be profitable when the goal is to keep up with the ever-growing needs of the modern-day business environment. Thus, digital transformation increases customer value, reduces friction, and accelerates productive workflows.

The following are some of the great benefits companies can leverage from digital transformation:

Stay in competition

Many take the concept of digital transformation as a way of modernization, while for some businesses, it can be nothing but a game of survival in the modern business world. Either case, digital transformation helps organizations and companies stay ahead in the competition. A business still running on its traditional culture is likely to fall behind in the race when competitors have already adopted advanced digital ways.

Workplace flexibility

One aspect of going digital is to use online communication tools to connect to others seamlessly. Such an approach breeds workplace flexibility for an organization where online communication software, the Internet of Things, and cloud computing allow employees to connect from anywhere in the world. When information can be sent and received globally with just a click, organizations experience an increase in productivity and efficiency.

Cost-effective solution

Digital transformation can save companies a lot of money. Optimized processes can save the time and efforts of employees and can immensely contribute to your ROI. Digitized process improves employee engagement and boosts productivity. It helps reduce error margins, and employee and process downtimes giving your customers an enhanced experience.

Increased security

Confidential data is always at risk. With digital transformation, security is strengthened through cloud computing which only authorized users can access. Similarly, advanced security systems will notify when an unauthorized source's access attempt is detected. This way, companies and businesses can better track where and to whom the sensitive data is shared.

Build brand credibility

A single mishap is enough to destroy a business' long-built reputation. It is precisely why adopting digital technologies can secure a company's credibility by providing a platform where updates can be quickly posted. Similarly, onsite customer reviews, certified trust seals, third-party awards, and testimonials are enough to bind clients and businesses in a trustworthy relationship.

Improved employee retention

One of the most significant benefits of digital transformation is when the artificial intelligence tools replace time-consuming, mundane manual activities in the workplace. Poor employee retention is the leading cause of slow growth and even business failure. Opting for digital ways to handle data can relieve your workforce from the burden of regular, robot-like work. Thus, a positive work atmosphere driven by digital transformation will generate more productivity, efficiency, and profits.

Planning and research

Digital transformation impacts all business areas, including budgeting, customer satisfaction, talent struggles, and culture change. It also involves employees' mindset, leadership, and the entire business model and strategies to achieve long-term goals. With all the data being collected, stored, analyzed, and shared on single, secured platforms, companies can have better control and access over the data.

Similarly, a deeper insight into customer behavior can give you a fair idea to devise approaches to accelerate the service value, business credibility, and profits.

What is digital transformation anxiety? Why do companies fear digital transformation?

digital transformation anxiety

As surprising as it may sound, digital transformation anxiety is real and stems from the evergreen demands of failure to adopt a digital culture. The modern world moves fast, and we witness innovations that are increasingly employed to collect greater benefits every day. However, the other side of this is the overwhelming stress and burden that businesses and organizations go through.

It is because digital transformation is not just about adopting digital technologies; it also means replacing your entire workplace culture. It challenges the organization's status quo, forces the executives to think critically, and burdens them with a change that seems too complicated. Hence, despite being such a profitable and value-providing approach, companies are often hesitant and afraid of going digital.

The following are some of the challenges that might be the root causes of fear when undertaking digital transformation projects:

The fear of the unknown

One of the most common reasons employees and executives fear digital transformation is the unknown, terrifying digital world. Some fears are based on what you don't know, and this fear of the unknown has the same effect when considering digital transformation. Similarly, sometimes, employees are habitual in using traditional ways that a new workplace culture seems too complicated to adopt.

Fear of disruption

Technology overrides technology which brings in fear of disruption. The evolving rate is so fast that businesses may fear lagging behind their competitors and thus, remain hesitant in undertaking digital transformation. Disrupted business process is a great risk to growing companies and can hamper the growth rate considerably.

Overwhelming stress and fear of failure

An online presence is about professionalism, organized data, and instant feedback. Such rapid progression can overwhelm those who take time to plan everything. It is because once companies turn digital, they would be welcomed with greater recognition and, thus, increased responsibility. Such a big revolution can cause fear of failure in employees and executives since the transformation is always a two-dimensional process, and a delayed response from one side can lead to a significant loss on the other.

Fear of artificial intelligence

One of the reasons why employees are most reluctant to go for digital transformation is because of the fear that artificial intelligence would replace their jobs. In the modern world, a great amount of work is done by machines and robots. Employees, especially the older workforce, may fear being replaced if they let the company adopt new technologies.

Increased demands of customers

Because digital transformation allows for a platform where customers can give quick feedback, companies can feel overwhelmed by consumer demands. They can also feel afraid of negative feedback when unable to fulfill customer requirements or keep up the value to their expectations.

Digital transformation journey: From vision to execution

Digital transformation journey

Digital transformation anxiety is real, and so is the threat of survival. It is only through proper strategies and action plans that companies can survive in the digital world. It is important to note that the application of digital transformation will differ for every business depending on specific needs and challenges. However, despite the difference in constraints, a general digital transformation framework will have the following elements:

Digital technology integration

Digital technology integration

Culture and leadership

Culture and leadership

Client response

Client response

Employee training

Employee training

Workforce enablement

Workforce enablement

Operational agility

Operational agility

Furthermore, a business should take various steps before undertaking a digital transformation project to avoid fears and failures later. A proper action plan before replacing the current environment at your workplace with a digital culture will also boost adoption, given employees and customers will be more confident with new approaches.

The following are some ways to deal with digital transformation anxiety and how companies can reduce the failures in the long run.

Effective communication

Turning digital would be of no use when your workforce is unwilling to adopt it. It is precisely why proper communication before bringing any change is mandatory. Since the fear of the unknown and the uncertainty of the digital world can be the most significant milestone on the road to success, your action plan should be to convince your employees of the benefits of the digital world and its technologies.

Research before you invest

Every business is different and needs a strategy according to the services provided. However, despite the needs, the aim should be to enhance organizational performance with digital transformation. In the new road you take, confidence is of paramount importance. To have that confidence you need to research properly what it takes to build a perfect digital transformation process and the impact it will have on your business.

Keep a flexible strategy

It is useless to look for a one-fits-all strategy that works for all businesses. Companies often hire consultants who try to repeat the same old practices, which are rigid and may not apply to your business strategy at all. Hence, keeping a flexible strategy with room for modifications is essential. One of the best approaches is to look for variant and invariant variables in your business' needs and try to balance the two.

Focus on one area at a time

Digital transformation is not an overnight success; it depends on your business strategy and how many elements you want to integrate into your workspace. For instance, if the long-term goal is to focus on customer satisfaction and building a credible and trustworthy relationship between the brand and consumers, review pages, comment sections, and contact portals should be adopted and updated promptly.

Address your employees' fear of being replaced

The sooner it happens, the better. Companies should hold meetings to communicate to the employees and make them feel their worries are heard and acknowledged. If your business strategy is to introduce artificial intelligence, let your workforce know its benefits and how it will not replace but alleviate some of their burdens. Furthermore, if communication is not working, companies are often recommended to adopt other tools such as surveys, questionnaires, or indirect interviews to get employees' feedback.


Digital transformation is not a one-time thing; it is a journey that can take months and even years. Once you enter the digital world, regular updates and recent innovations will await you. The need of the hour is not to get overwhelmed but to actively plan on what aspect of your business needs an action plan. Lastly, the digital culture is applied to the workplace, where employees play a significant part. So, addressing their needs and eliminating their doubts and fears substantially impact the digitalization process.

What is Digital Transformation? Why is it important in today’s business landscape?