Introduction to Digital Transformation

This is a Digital Transformation tutorial offered by Simplilearn. The tutorial is part of the Digital Transformation course and will help understand the basics of Digital Transformation with examples and learn the importance of adopting it in our business.


At the end of this lesson, you will be able to:

  • Explain the meaning of being digital
  • Describe digital transformation and why it is needed
  • Discuss how digital transformation impacts key industries
  • Explain how being digital is different from just adopting technology
  • Describe who is affected by the digital transformation
  • List the key technologies that are disrupting the digital landscape

What is Digital Transformation?

Digital Transformation refers to an overall transformation of organizational activities aimed at leveraging opportunities created by digital technologies and data. This requires the company to profoundly transform its business model, infrastructure, processes, and culture, all geared toward constantly finding new sources of customer value.

Benefits of Digital Transformation to Professionals and Organizations

Let’a have look at the impact of Digital Transformation to Professionals.

Digital Transformation: Impact on Individuals


This transformation means a change in the outlook of the people governing the organization processes. It calls for change among executives, who play a major role in strategy development and its execution.

It requires the executives to have a vision and to rethink their entire business execution process, changing everything right from manufacturing of a product to how it is marketed and serviced.

Digital transformation also requires executives to shift their attention from improving existing products to adapting to new changes. This process involves integrating new business processes, practices, and information systems aligned with the goal of maintaining a good customer relationship.


Digital transformation calls for change not only among executives but also among CXOs who are the representatives of an organization.

It requires CXOs to:

  1. Embrace the innovation of the digital economy to define new ways of working, improve customer service, and invent technological platforms
  2. Propose strategies and lead the way for the big change
  3. Introduce branding initiatives to find new and latent needs that provide opportunities to reframe and shape things for the future
  4. Establish a broad vision, propose strategies, and free organization from the current legacy and habit, driving it toward a digital mindset

Now that you have learned the changes that should be made at an individual level, let’s look at the impact of digital transformation at the Enterprise level.

Digital Transformation: Impact on Industries

Becoming a digital enterprise requires far more profound changes than merely investing in the latest technologies.

It calls for change in:

  1. Digital Business Models: Companies need to fundamentally change the way they identify, develop, and launch a new business
  2. Digital Operating Models: Companies need to follow a lean approach to both core and support functions
  3. Digital Talent and Skills: Companies need to attract, retain, and develop the right talent
  4. Digital Traction Metrics: Companies need to adopt newer Digital traction metrics as traditional KPIs are no longer effective in a digital business

Major industries are impacted by digital transformation. Some of them include:

  • Insurance
  • Banking and Finance
  • Healthcare
  • Manufacturing
  • Information Technology
  • Travel
  • Transport and Logistics
  • Utilities
  • Retail

Let’s discuss the implications for each sector in detail. Given below are few ways by which digital transformation impacts industries.

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Digital in insurance sector has changed the way people avail insurance policies.

For example:

Metromile, a San Francisco-based car insurance company, offers pay-per-mile insurance and a driving app. Metromile installs a device on the vehicle. The device continuously monitors miles, sudden speed changes, jerks, collisions, etc.

It works on Artificial intelligence based algorithms to improve the underwriting (assessing risk and defining premium for insurance) as it collects more data about usage.

Banking and Finance

Digital adoption in the banking sector has helped in upgrading from traditional banking to an Omni-channel approach. Banks and financial operators are aggressively modernizing technology infrastructure to enable current and future growth across all business sectors.

For example:

Bank of America revolutionized the banking sector through the integration of IoT in its business.

It partnered with popular wearables like Apple watch and Fitbit, where a portfolio of Micro tags and Mini tags are attached to the devices.

This makes the payment cash free. Customers need to just scan their smart devices to the machine installed at the shops. This makes the life of customers much easier.


The digital acceptance in the healthcare sector has revolutionized the entire patient experience, right from booking an appointment to follow-up process, in a new and exciting way.

For example:

Practo empowers people to search doctors around them at their own convenient time, validate, and book appointments. It:

  • Keeps all records within the app
  • Provides 24/7 healthcare services
  • Provides online consultation
  • Ensures medicine availability and
  • Tracks payments


Digital transformation revolutionizes the way manufacturers share and manage products.

For example:

Airbus, a manufacturer of aeronautical products, is involved in the assembly of commercial jetliners. Such crafts have millions of components and tens of thousands of assembly steps, and the cost of mistakes during the process can be enormous. To tackle the complexity, Airbus launched a digital manufacturing initiative known as Factory of the Future, based on IoT, to streamline operations and bolster production capacity.


Consumers are relying on digital channels and platforms for all their travel needs, from researching to booking. This has totally transformed their travel experience.

For example:

Trivago specializes in Internet-related services and products in hotel and lodging. It offers travelers with a consolidated view of hotel booking options available across hundreds of travel sites. Trivago scours more than 200 booking sites to offer the best rates on more than 1.3 million properties. It also acts as an advertising platform where independent property owners can advertise alongside major online travel agencies and hotel giants using cost-per-click advertising that drives customized traffic to the websites.

Transport and Logistics

Digital integration has helped in improving efficiency, speed, and timing, which form the core of transport and logistics industry.

For example:

FedEx introduced IoT in its supply chain model. It was faced with the problem of maintaining the quality of healthcare products while in transit. It integrated SenseAware—based on IoT technology—to keep a check on temperature, location, and vital signs of the package.

This helps in making real-time decisions. For instance, if a perishable goods package sets off on a 2-day journey but the sensor data show that the shelf life has decreased, then the package can be instantly diverted to another location, which saves both time and money.


Mobility, intelligent devices, big data, and business process management systems constitute the digital ecosystem through which utilities can deliver customer experience, operational efficiencies, and changing business models.

For example:

RWE Power and Slock run a blockchain energy P2P sharing project. The companies are putting together a decentralized billing system for electric vehicle charging. It is called BlockCharge.Following the principle of roaming for telecommunications, it allows charging of electric vehicles anywhere (with the help of a smart plug) with a simple billing interface powered by blockchain technology. It enables the electric vehicles to interact automatically with stations and makes the electricity payment process autonomous.


Digital integration has helped in creating personalized services to customers in the retail sector.

For example:

Amazon, an online retail giant, is well known for its integration of technologies like IoT sensors, artificial intelligence (AI), and cameras in its brick-and-mortar stores. This eliminates checkouts.

This has been made possible through the Amazon Go app, which allows customers to make purchases on their cell phones. This app-based technology uses computer vision, sensor fusion, and deep learning to provide a checkout-free shopping experience. The union of these technologies automatically keeps a track of input and output of products from the shelves and helps maintain a virtual cart. Once the customers are done with their shopping, they can leave the store. Their Amazon account is charged and a receipt is sent. This eliminates the need for waiting in the queue.

The application of digital transformation across various industries gave us insights into its relevance and importance. However, for digital transformation to be successful, it needs the support of various digital advances.

Let’s learn about them in detail.

Introduction to Digital Technology

The digital impact on our lives is all-encompassing, whether it’s sending a message to somebody, ordering food, or booking a cab. Everything has gone digital. The change is invisible but true and is transforming people’s lives.

So, what does being digital mean?

Being digital is more than just having a mobile app, equipping the sales force with iPads, striving for likes on Facebook, or moving the organization’s data to the cloud. It is about creating harmony in different interrelated components at play.

Executives need a framework to see how the components work together so that they can plot their own path to being digital. Digital refers to increasing the connectedness between people, processes, and products while generating insights from the information produced to create value.

What is Digital Transformation for Business

Digital transformation is sometimes referred to as business transformation.

The value generation process through connectedness in different components calls for reexamining the entire way of doing business and exploring new frontiers of value. This may involve developing entirely new businesses in adjacent categories.

The business transformation through the adoption of Digital technology has changed the entire landscape of client engagement, commerce, marketing, and more across industries.

Digital Transformation Examples

Let’s have a look at the impact of this Digital transformation through an example:

Uber developed an application that is simple yet revolutionary:

The idea that a customer can book a car anywhere and at any time in one click has transformed the idea of customized transport service at a large scale. The Uber phenomenon has set an example for changing the concept of service.

The success of this application, which results from the digital revolution, is only the beginning of an inescapable transformation of the economy with tendencies of impacting professionals from all sectors.

Another such example of Digital transformation is from the insurance industry: Lemonade is an Artificial Intelligence powered automated mobile insurance platform that can underwrite policies and process claims within minutes. Lemonade has been in the news for settling an insurance claim within three seconds using its claim bot, Jim.

It reviews the claim, cross-references details with the original policy, and runs fraud detection algorithms. Once everything looks okay, it sends wire instructions to the bank to pay the claim. Digital Transformation is evolving at a fast pace. Companies and individuals are adapting to the change to transform their processes and create good customer experiences. Let’s now understand what digital transformation is.

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Need for Digital Transformation

Organizations need to evolve digitally to address the changing business landscape. The reasons for increasing importance of Digital Transformation are:

  • Acceleration of Change – The pace of digital change is rising exponentially, making it very difficult to maintain a position of industry leadership and requiring an acceleration of new digital solutions brought to market.

  • Digital Competition – The increasing pressure of digital competition has forced the long-established businesses to reexamine their models on the lines of new “born digital” start-ups.

  • Customer Expectations – Customers expect a good experience across all touchpoints. It is important to ensure that their interactions are seamless and exceptional.

  • Digital Adoption: Digital adoption of Big data, automation, and IoT has made it necessary for companies to transform completely.

But, does digital just involve adopting technology? Let’s understand this.

Being Digital vs. Adopting Technology

Digital is not confined to the adoption of technology. Digital requires companies to have a bonafide corporate transformation, with an emphasis on strategic innovation for the long-term and shared ownership where technology supports the process.

Let’s list the differences:

Being Digital

Adopting Technology

Focuses on buying technology that fits business needs the best

Focuses on buying the best and latest technology with no considerations for business needs

Calls for overall cultural change before adoption

Does not require cultural changes

Demands holistic view of the business problem from leaders

Does not need a reference to the business problem

Focuses on strategic innovation from long-term perspective

Has a narrow perspective to meeting immediate business needs

Calls for change in core elements and policies of business

Plays a supporting role in digital transformation

By now, you must have understood the importance of digital transformation and how the change is the need of the hour.

Where did the concept of digital transformation start?

Digital Transformation: Evolution

The overall history of computing has altered over the past 70 years. Computing, which was defined by the vacuum tube initially, has advanced from transistor to semiconductor to mainframe computing to mini computing to personal computing to the Internet and now to IOT in 2020. The reach has risen from 1 million to 50 billion.

To use the available information better, companies have started to connect all processes and devices into networks. They have started experimenting with new digital ways of doing business, leveraging data better, and transforming to create greater agility.

Now, let’s analyze who are affected by the change.

Who is Digital Transformation Affecting?

The evolution over the years has made it crucial to change the approach of how we meet customer needs and expectations. This calls for change at both Individual levels as well as the Enterprise level.

At the Individual Level, leadership approach of both executives and CXOs needs to be altered to make way for a more dynamic, risk-taking, and lateral organization. At the Industries or enterprise level, the hierarchical approach in business to rewarding innovation irrespective of the hierarchy must change.

Let’s discuss impacts Digital Transformation has on different stakeholders in an Organisation.

Key Takeaways

  • Being digital means bringing together a number of interrelated components that increase connectedness and provide valuable insights.
  • Digital Transformation strategy refers to an overall transformation of organizational activities, aimed at leveraging opportunities for changing digital technologies.
  • To become a Digital Business, you require informed leaders who can create a strategy using evidence, lead teams to work, educate them to approach challenges using data-driven decision, and create constant cycles of agile and focused innovation.
  • The key technologies disrupting the change include Data analytics, Artificial intelligence, Robotics, Cloud computing, Blockchain, IOT, and Digital marketing.

Topics Covered

There are 9 lessons covered in the Digital Transformation tutorial. The lesson names and their descriptions are listed below.

Lesson No.

Chapter Name



Blueprint of Digital Transformation

In this lesson, you will learn more about:

  • Explain the digital transformation framework
  • Discuss how to reimagine your value chain by applying digital processes to your operational and customer journeys
  • Describe how to build digital capability across the company


Driving a Digital Culture and Mindset

In this lesson, you will learn more about:

  • Discuss what constitutes a digital mindset
  • Describe how you can drive a digital culture within your organization
  • Explain how to instill customer centricity through design thinking
  • Describe how to foster innovation, collaboration, and agility across the ecosystem to deliver value to your customers


Business Analytics and Big Data

In this lesson, you will learn more about:

  • Define big data and the 4 V's of big data
  • Explain big data analytics and its importance
  • Discuss different types of business analytics
  • Describe the analytics process flow
  • Explain how companies are using their big data to obtain business benefits


Artificial Intelligence and Machine Learning

In this lesson, you will learn more about:

  • Define Artificial Intelligence and machine learning
  • Explain the impact of machine learning in various industries
  • Discuss how to leverage machine learning


Blockchain and IoT

In this lesson, you will learn more about:

  • Explain blockchain and its advantages
  • Discuss how industries are using blockchain technology
  • Define IoT and its advantages
  • Describe how industries are using IoT technology


Robotics Process Automation

In this lesson, you will learn more about:

  • Define Robotic Process Automation (RPA)
  • List the benefits of Robotic Process Automation
  • Explain the three stages of RPA solution
  • Describe RPA Implementation process
  • Discuss the popular RPA vendors and their tools and platforms


Cloud and DevOps

In this lesson, you will learn more about:

  • Discuss the meaning and definition of cloud computing
  • List the benefits and use cases of cloud computing
  • Identify the service and deployment models of cloud computing
  • Understand how cloud computing is changing the landscape
  • Explain the association between cloud computing and digital transformation
  • Describe the meaning of DevOps
  • Analyze the relationship between cloud, DevOps, and digital


Digital Marketing in Digital Transformation

In this lesson, you will learn more about:

  • Explain marketing automation and remarketing
  • List the trends of digital marketing
  • Describe how digital marketing impacts industries


Conclusion and Next Steps

In this lesson, you will learn more about:

  • Envision the digital future of the firm by diagnosing the potential value of existing corporate assets
  • Design programs that ensure optimum utilization of resources by investing in skills and initiatives that target profitable customer experience journeys
  • Deliver insight and foresight by analyzing real-time and historical data and using predictive models to identify business opportunities and risks
  • Act at the moment by using real-time insights to enable customers, workers, suppliers, and machines to seize opportunities immediately and take collaborative action at the moment of greatest impact
  • Streamline work by increasing automation, usability, collaboration, and real-time processes to improve efficiency
  • Network the business by connecting internal business processes, labor, ecosystem partners, and customers to deliver a new level of transparency and create value that goes beyond the boundaries of the enterprise
  • Deliver innovative outcomes by developing a new solution and business models in an Agile way to create greater value for the customer and the supplier


With this, we come to an end about this Digital Transformation tutorial. In the next chapter, we will discuss 'Blueprint of Digital Transformation.'

  • Disclaimer
  • PMP, PMI, PMBOK, CAPM, PgMP, PfMP, ACP, PBA, RMP, SP, and OPM3 are registered marks of the Project Management Institute, Inc.

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