According to the 2021 CIO outlook report, 77.3% of Fortune 500 Chief Information Officers identified digital transformation as their top budget priority for 2021. This isn't surprising. An increased focus on digital transformation can assist in resolving many of the common challenges that impact asset lifecycle management, including employee productivity and stakeholder visibility.
But perhaps the most significant benefit of introducing digital transformation to the asset lifecycle is increased competitive advantage. Losing business to overseas clients could become yesterday's problem with an intelligent digitization strategy.
What is Digital Transformation?
Digital transformation is the adoption of digital solutions across every area of an organization to achieve higher operational efficiency.
While COVID played a significant role in accelerating digital transformation, its adoption isn't slowing down. According to Teksystems' 2022 State of Digital Transformation report, 89% of leaders said digital transformation was a core pillar of business strategy, and 86% of digital leaders believe they are well-positioned to reskill or upskill the workforce to be productive with digital technologies.
Digital transformation owes its rising popularity to the sizeable efficiency improvements of every business domain exposed to its strategies, especially asset lifecycle management.
The common frustration of asset lifecycle management includes poor operational efficiency, poor visibility, and poor inter-team communication - a digital transformation strategy could resolve all of these problems.
Benefits of Digital Transformation
Digital transformation is always accompanied by increased complexity. The increased complexity of new technologies, as well as complexities relating to investment monitoring, to ensure increased value is obtained. But the significant operational benefits resulting from digital transformation heavily outweigh any adverse associations with increased complexity; these include:
- Improved productivity
- Increased stakeholder visibility
- Timely meeting of project deadlines
- Progress report automation
- Seamless scaling
- Reduced time to market
Businesses that embrace digital transformation adorn a competitive advantage that's very difficult to ignore. Those that fail to respond to the rising demands of digital transformation risk rapidly falling behind.
Challenges of Digital Transformation
Operational reforms are not easy and digital transformation is not an exception. According to a Forrester report, more than half of digital transformation efforts failed completely in 2018.
Two reasons are likely to blame.
According to Capgemini, 77 percent of companies consider a lack of digital skills to be the most significant barrier to their digital transformation. At the same time, McKinsey reports that 70 percent of all digital transformations fail due to employee resistance.
Besides insufficient digital skills and employee resistance, increased security risk threatens digital transformation success. This is a significant obstacle since security vulnerabilities threaten business continuity and directly impact the bottom line.
These challenges can be overcome with the following strategies:
1. Digital transformation training
Digital transformation training can address the issues of employee resistance and digital skills shortages. Training will reveal pools of staff willing to upskill their capabilities with specialized coaching and deficits that are best filled with outside talent.
Training will also overcome any resistance fueled by fear of new technological solutions. Sometimes it's as easy as assuring staff they won't be replaced by machines.
2. An asset management cybersecurity solution
A cybersecurity solution specifically designed for asset lifecycle management can address the increased security risks caused by digital transformation. It's important to focus on asset protection since cybercriminals tend to target capital project assets immediately after breaching a corporate network.
3. Mitigate data exposures
Prevent accidental outbound data exposures by monitoring all data migrations throughout the asset lifecycle, including data in use, data in transit, and data at rest.
4. Monitor for compatibility losses
Exercise caution if any compatibility issues arise when automation processes between networked assets are modified, or new processes are introduced.
5. Maintain regulatory compliance
Ensure asset operations comply with regulatory standards of security and procedural frameworks to avoid costly non-compliance fines.
6. Design a business continuity plan
Ensure that risks affecting the availability of business services following a disruption, such as server outages, are addressed in a business continuity plan.
7. Mitigate third-party risks
Identify and address all third-party security risks threatening the integrity of asset lifecycle data through security questionnaires and risk assessments.
Digital transformation solves all of the major frustrations associated with asset lifecycle management. In addition to increased operational excellence across all capital projects, digital transformation offers a significant competitive advantage that spans international borders, tilting the risk of lost business in your favor - instead of losing business to overseas competitors, your overseas competitors will lose business to you.
To discuss strategies for accelerating your digital transformation, get in touch with us today.