How to Find Out That Digital Transformation of Small Business Can Boost ROI & Profit?
COVID-19 has practically metamorphosed the business landscape, and digital transformation has become the main tool to stay competitive and relevant. In this context, you can safely say that Digital Transformation is the cog driving the wheels of business today. But it is not that simple as it sounds.
Many companies, despite the understanding of digital transformation, are experiencing fatigue. According to a recent survey, 90% of business owners said they have a digital transformation strategy but have failed to implement it. That’s because most business owners view digital transformation as a tool to replace manual processes, which is, of course, a narrow way of looking at things.
Ways to Measure ROI
Every business has its way of measuring ROI that is aligned to its needs and goals. But there are some KPIs that you generally use to measure the success of your Digital Transformation.
Active User Metrics
Technology adoption is a key factor for implementing a successful digital transformation. One of the best KPIs is the active usage of digital assets. You can do it by comparing the number of licenses purchased against those using your product or service.
Other performance indicators include daily active users, and conversion rates will give you a good picture.
Employee engagement and participation are key indicators of a successful Digital Transformation. Few metrics that might help you to measure:
1. Net prompter score
2. Exit rate
3. Employee satisfaction index
4. Bounce rate
If your employees aren’t engaging the way the organization moves, your technology isn’t that powerful. Even when you have a successful digital strategy, it will take a nosedive without employee participation.
You can measure Digital Transformation through employee productivity KPI. It measures the value of output an employee brings to your organization. Calculate the revenue generated by each employee and use this to understand the successful implementation of your digital transformation. For example, you can use tools like:
1. Are employees optimizing their work hours
2. Are they hooked throughout the process
3. Are they working on complex tasks more efficiently than before?
Cost of Online Commercials
A successful Digital Transformation can generate more revenue from your digital investments. You can monitor the amount of money spent on technology and measure the percentage of investments that influence revenue.
Calculating The Risk Factors
The long-term availability of requires systematic investments to reduce the risk associated with technology. When you are digitizing your assets, you must calculate the risks associated with cybersecurity and data privacy. Besides, you can use the following metrics to assess the security posture of your organization.
1. Frequency of data access
2. Data transfer volumes
3. Number of vulnerable systems
Understanding Customer Experience
End-user satisfaction is the ultimate goal of any organization. It determines the way Digital Transformation translates to customer satisfaction. Some common tools you can use to measure customer satisfaction include:
1. Customer satisfaction score
2. Customer effort score
3. Customer Loyalty index
4. Sentiment analysis
Use Business Apps
It is necessary to monitor every facet of digital transformation while addressing the distinct requirements of any business. You can use the line of business apps or LOB for mapping the requirements. It will help to improve usability and contribute towards increasing ROI. You can also check some business software and research for yourself.
This is an ongoing process that affects every stakeholder in the business. It involves employees, CTO’s, processes, and customers who are doing business with you. A successful DT can bring you a higher ROI when you follow the right steps. Therefore, it’s important to follow industry-proven best practices that have enabled industry leaders to push the boundaries with their projects.