Digital transformation can be defined in many ways, but the essence of the idea is that new technology can not only enhance traditional methods, but can actually transform the way of doing things and enable a greater efficiency through new processes.
For example, tangible items can be digitized in the way that recorded music became mp3 files, or companies begin to “go paperless” by utilizing email and PDF documents. But a true transformation would refer more to the new process that digitization enables, for example, the mp3 format spurred Apple iTunes, and fundamentally changed the way we buy music. Or to be more on point, cloud based tools like ERP software allow the sharing of information across all departments in real time, and remotely, which can fundamentally rework the way supply chain, billing, and customer service processes interact.
By now, the concept of going paperless, and focusing on implementing digital technology into deeper aspects of company operations and structure seems apparent, but how does this impact the ERP workflow?
Managing New Processes
By embracing digital transformation, companies are seeing improvement in areas of customer understanding, strategic tasks, and subsequently decision making, but before we can grasp what this means for ERP Software, we need to look at what digital transformation is doing to company strategy, and more importantly, how organizations are managing this information.
From a marketing standpoint, making the switch to a more advanced digital process, companies can now reach customer demographics previously missed, gain more accurate information about customer segments, and retain and analyze this data in a central database accessible from anywhere in the world.
From a manufacturing perspective, digital transformation has enabled the integration of business operations in a centralized ERP platform. This allows for real-time management of supply chain resources, and can coordinate things like material ordering, scheduling, production, and customer billing.
To summarize, digital transformation impacts both employee and customer engagement by activating the invention and adoption of more advanced tools and processes.
Possibly the most widespread but often overlooked digital transformation is social media. Not only can businesses interact with customers in a new way, but the fact that it is becoming the go-to channel of communication for some consumers highlights a fundamental transformation in process.
With this rise, not only are companies able to engage customers directly in a familiar social media setting, but it is also becoming a must for customer service and reputation management (think answering comments and reacting to complaints). Further, these social platforms can be a gold mine for customer feedback, highlighting new and trending customer desires and needs.
What This All Means for ERP
As the focus of digital transformation expands organizational ability, through a plethora of options from mobile applications to cloud based solutions, ERP systems are perfectly situated to enhance business operations and interdepartmental communication.
Leveraging an ERP Solution for the essential day-to-day tasks of things like accounting, project management, supply chain management, and other back-office functions, allows for streamlined business processes. For example, an integrated ERP system can not only allow you to digitize records from customer information to bills of material to invoicing, but it can transform the employee workflow.
As a result, the procurement department, shop floor scheduling team, shipping manager, and accounting team can be in lock step, eliminating miscommunication, redundancy, and down time. This isn’t simply a result of records being digitized and centrally databased, but rather a fundamental optimization for greater efficiency brought on my digitization.