The State of Digital Transformation 2016


Digital transformation has become far more than a tech industry buzzword in 2016. It is now a prime directive in nearly every imaginable industry. The digital economy now stretches to every corner of the economic universe as customer demands drive an ever-accelerating pace of change. This leaves companies fighting significant battles on several fronts—modernizing systems, changing business models, and updating processes while attempting to focus on customer experience through the lens of technology. The struggle to balance technology and organizational priorities is protracted and striking it makes it difficult to find a productive path toward change.

With all these challenges, of course, comes a wealth of opportunity for companies that successfully navigate digital transformation. The 2016 Altimeter Report on The 2016 State of Digital Transformation compiles years of research to help clear the path for executives and practitioners who are driving digital transformation in their organizations. Here we will highlight some of the key findings to see how companies are approaching transformation.

Customer experience continues to drive transformation efforts

We’ve talked a lot about how the customer is now in charge and the perils of ignoring their needs and demands. Companies look to customer behavior to inform and lead change, which puts CX at the heart of accelerating digital transformation initiatives. But it’s not just about chasing digital customers. As technology and customer behavior evolve, businesses are identifying new ways to increase reach, revenue, and impact.

The report cites these as the top drivers of digital transformation:

  • 55% Evolving customer behaviors and preferences
  • 53% Growth opportunities in new markets
  • 49% Increased competitive pressure

Best Practice: Mapping the Digital Customer Journey

If you want to know how to reach your customers at every touch point, you have to know how they are getting there. According to Altimeter’s research, in 2014, only 25% of companies undergoing digital transformation had mapped the customer journey and had a clear understanding of new or underperforming digital touchpoints. Yet, 88% cited CX as the driver for change. But now, businesses are investing in a customer-centric approach that offers insights, purpose, and direction. Today, 54% of survey respondents have completely mapped out or are in the process of mapping out the customer journey within the last year.

Exploring Mobile-First Moments

How often do you start shopping for something on your phone? Check on an order? Make an order? Seek customer service or reviews? Mobile has become a huge part of the customer journey, but many companies are still ignoring mobile nearly wholesale. As consumers increasingly use their phones to complete everyday activities, they’re fracturing the consumer journey into hundreds of new “micro” touchpoints where they seek real-time, mobile-optimized content, reviews, shared experiences, and direction online. Traditional touchpoints, such as websites, contact centers, affiliates, etc., aren’t meeting heightened expectations. In fact, they deter from what’s becoming an on-demand customer experience. As such, micro-moments represent new, critical opportunities for brands to shape their decisions and preferences. Despite all of this, just 20% of digital transformation leaders are studying the mobile customer journey and/or designing for real-time micro-moments in addition to customer journey work.

The struggle to understand connected customer data

Connected customers means a wealth of actionable data at your fingertips, right? Yes and no. Just having the data is just the start—understanding it is an entirely different ball of wax. Executives still don’t engage with the brand or business the way customers do. By not prioritizing customer journey work, companies face challenges in understanding new consumer behaviors and missing related datasets for decision making. Companies that don’t grasp or internalize the customer journey are obstructed from seeing its potential for optimization and innovation. It’s not a surprise, therefore, that 71% of those faced with leading digital transformation efforts is understanding behavior or impact of new connected customers.

Prioritizing innovation as digital transformation matures

While CX was initially the primary catalyst for digital transformation, innovation, agility, and the pursuit of digital relevance are the new factors driving companies along the maturity model. For executives and senior leadership, the need to accelerate innovation (81%) was at the top of the digital transformation agenda. Right behind it was the need to modernize the IT infrastructure with increased agility, flexibility, management, and security (80%). And, the third priority for enterprise transformation is improving operational agility to more rapidly adapt to change (79%). Through these priorities, businesses are developing a roadmap that helps them compete for the present while building a next-generation business model to compete for the future.

Download this case study to see how Pitney Bowes used Aria for its successful digital transformation efforts.

Get the full Altimeter Report “The 2016 State of Digital Transformation” here.