How to Utilize Expertise to Maximize Digital Transformation Outcomes
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- Outsourcing digital transformation can be a powerful tool to help businesses concentrate on their core functions, generate revenue, and save time, resources, and manpower.
- To succeed in digital transformation outsourcing, a strategic approach is essential, including end-to-end process redesign, joint accountability, and a focus on transforming operations.
- To choose the right digital transformation partner, it's important to define your requirements, evaluate their experience and expertise, assess their capabilities, and consider cultural fit. Establishing clear roles and responsibilities, maintaining regular communication, and monitoring project progress are also key to ensuring a successful partnership.
In the fast-paced business world, companies are under constant pressure to improve their processes and enhance their digital capabilities to stay competitive.
However, not all businesses have the resources or expertise to carry out digital transformation projects internally. This is where outsourcing digital transformation comes in.
In this article, I will explore the benefits of outsourcing digital transformation, the best practices for choosing the right provider, and how to ensure a successful partnership.
The Benefits of Outsourcing Digital Transformation
As a leader in the business world, it is crucial to recognize the significance of defining your distinctive value proposition and prioritizing the delivery of top-notch services in your particular area of the industry.
But what if you don't have all the tools?
Outsourcing can prove to be a potent tool and operational approach that enables leaders to concentrate on crucial tasks that constitute the core of the business and generate revenue, saving time, resources, and man power.
Many businesses that use outsourcing say that it increases focus on core functions, and about two-thirds cite cost savings as a primary advantage of outsourcing.
If you’re still hesitant to outsource your digital transformation, think again.
Success Factors for Digital Outsourcing
Globally, outsourcing spending is predicted to reach $731 billion in 2023. IT outsourcing spend could increase 22% over 2019's numbers to reach $519 billion in 2023. The global business process outsourcing spend could increase 19% over 2019's numbers to reach $212 billion in 2023.
Grandview Research predicts the business process outsourcing industry will reach $525 billion by 2030.
Look at these numbers carefully. What do you perceive?
It's clear that in this digital age, the ability to harness the power of outsourcing is key to driving operational excellence and achieving innovation.
But let's face it, not all outsourcing strategies are created equal. To truly succeed in digital transformation outsourcing, a strategic approach is essential.
End-to-End Process Redesign
To capitalize on digital, companies must redesign their entire end-to-end processes rather than outsourcing a fragmented slice of a process. Service providers should take ownership of the entire process, from optimization to digitization and automation. This approach will eliminate manual processes and work, resulting in improved results and maximum impact.
Digital sourcing requires a joint governance structure, where dedicated teams with representatives from both organizations develop and monitor a comprehensive set of key performance indicators (KPIs), including customer experience. Providers should be empowered to make decisions and coordinate closely with customers as partners, addressing concerns such as data loss or access to technology stacks.
Focus on Transforming Operations
According to McKinsey, worldwide, companies spend an estimated $230 billion on managing business processes. These range from customer-service functions, such as call centers, to back-office processing in applications such as claims, payments, finance, and procurement.
Despite this significant investment, only a small portion of outsourcing deals currently incorporate next-generation technologies. However, the demand for these deals is rapidly increasing.
In the past, outsourcing was transactional, and providers were paid based on a straight rate for time and materials. However, digital outsourcing is shifting towards transforming operations through digitization, where providers take on more complex processes and are paid based on the outcome they deliver and the range of technology solutions they deploy, such as natural language processing, robotic process automation, or AI.
Choosing the Right Digital Transformation Partner
According to research from Accenture, 90% of companies contract third-party solution providers to help them with at least one component of their digital transformation.
But, choosing the right digital transformation partner is critical to the success of your project. Here are some best practices that I’ve learned over the years. These will save you the trouble and help in selecting the right provider:
Define Your Requirements
Before selecting a provider, define your requirements and expectations. This includes understanding your business goals, project scope, timeline, and budget.
Evaluate Provider Experience and Expertise
When selecting a provider, evaluate their experience and expertise. Look for providers with a track record of delivering successful digital transformation projects and experience in your industry.
Assess Provider Capabilities
Assess the provider's capabilities and determine if they have the necessary skills and resources to deliver your project. This includes evaluating their technology expertise, project management processes, and quality assurance practices.
Consider Cultural Fit
Cultural fit is an essential factor to consider when selecting a digital transformation partner. Select a provider whose values and culture align with your organization's values and culture.
How to Ensure a Successful Partnership?
Establish a collaborative and transparent relationship with your outsourcing provider for a successful partnership. Here are some best practices for managing an outsourced digital transformation project:
Establish Clear Roles and Responsibilities
Establish clear roles and responsibilities for both your internal team and the outsourcing provider. Defining who will be responsible for project management, quality assurance, and communication will save you a lot of time and hassle in the future.
Maintain Regular Communication
Maintain regular communication with your outsourcing provider to ensure that the project is on track and any issues are addressed promptly. This includes scheduling regular status meetings, progress reports, and milestone reviews.
Monitor Project Progress
Monitor project progress and ensure the project is on track to meet its goals and objectives. I strongly encourage tracking key performance indicators (KPIs) and adjusting the project plan as needed.
Manage Project Risks
To manage project risks, I recommend having a risk management plan in place. This includes identifying potential risks, assessing their impact and likelihood, and implementing risk mitigation strategies.
As businesses continue to navigate through the complexity and ambiguity of the digital economy, the importance of digital transformation cannot be overstated. However, the journey toward digital transformation is not easy, and it requires a mix of skills and expertise that are often scattered across the enterprise and its external partners.
That's why outsourcing digital transformation to a trusted provider like UniAspect Digital can be a game-changer. By partnering with us, you can accelerate your digital transformation journey, minimize risks, and maximize returns.
Whether you're looking to improve productivity, reduce costs, or drive innovation, UniAspect Digital has the expertise and experience to help you achieve your business goals and objectives. Contact us today to learn more about our digital transformation services and how we can help future-ready your business.