Digital Transformation of Operations Management

Digital transformation impacts every aspect of society, particularly economies. Organizations are now accorded an opportunity to fundamentally change their business models through new digital technologies such as big data, mobile technologies, social media, and other innovations. This often involves modifications to the core operations within a business including workflows and organizational structures. Consequently, society generally faces a radical shift as a result of the growth of digital economies and their broad implementations across markets. Further to the increasing interests from organizations and clients, most companies are facing heightened competition as a result of globalization, putting more strain on digital transformation as companies strive to survive and retain their market shares.

Digital transformation ideally implies rethinking how technology will benefit a firm and processes geared at enhancing performance. Though technology is the main component of digital transformation, the general philosophy must pervade across organizational cultures so as to be successful. It is imperative to understand that digital transformation is a journey as opposed to a quick solution. Businesses embracing such ideology are the ones that are genuinely transforming digitally, while the ones purchasing technologies are simply assuming to be part of the journey.

However, digital transformation is more about technologies being adopted, how, and where. It is about company-wide transformation affecting each process and making every operation digitally viable.  It is a continuous process with people and culture being the main contributing factors. It begins with digital products and services then trickles down to ideologies, technologies, people, and processes that create, enable, manage and deliver them.

The concept of digital transformation has hardly been a focus for researchers. However, some studies have defined digital transformation in some of their works. Digital transformation majorly focuses on processes, products and organizational changes as a result of the adoption of technologies. Digital transformation has also been termed as where a business is modelled using technology as a catalyst towards radical improvements. From these definitions, we can conclude that digital transformation focuses on the linking of assets where previously separate processes, activities and people are brought together to become inter-linked.

Digital technology brings highly sophisticated innovation challenges that will force changes within the organization particularly the structure. Consequently, fresh strategies on how to roll out information technologies, in order to foster business development innovation should be applied. In most firms, information systems are perceived as strategic assets which bring together people, structures, processes, and information technology. In addition, as per Coster et al, information systems are applied to shape or support a firm’s competitive advantage, it is a strategy for getting and sustaining competitive advantage and is seen as fundamental to the development of business strategy.

In the publishing and music industries, examples of digital transformation reveal that it is not just a strategic option, but rather an inevitable duty that all organizations must face. Given that digital transformation is characterized by the adoption of new technology to foster business growth, it can be perceived as an inevitable opportunity for an organization’s business development, instead of just being an emerging hype.  The introduction of digital technologies can help organizations realize their business objectives as it is an enabler for diversification and penetration into new markets. They strive towards business development allows organizations to spot fresh growth opportunities and to target efforts on establishing new stimulants to growth while at the same time continuing with established business operations.

The gap digitally between firms is elucidated as the variance between good use of technology for productivity.  A study carried out between SMEs within Spain, the USA, Portugal, and Poland confirmed a hypothesis the more a specific market is based on the knowledge the higher the chances that digital transformation barriers will move away from financial challenges to technology planning. A study carried out in Singapore released a report title “Cultural Transformation in the Digital World” which studied digital transformation experiences of major firms. The study affirmed the fact that culture ascertains transformation as opposed to knowledge about technology with the majority of respondents agreeing that way of life was the biggest impediment to digital transformation. Furthermore, the report indicated that organizational leaders had the ability to spearhead digital transformation, but the majority of them ignored implementation challenges.

The study also reports that digital transformation eventually succeeds if it is based on character, that employees will embrace the exercise if they first understand what goals are wanted before digital transformation. The study also indicated the prevalent cultural elements for people deemed effective for digital transformation including flexibility, openness, and agility. Furthermore, four major cultural dimensions individualism, power distance, uncertainty avoidance, and masculinity were highlighted that reveal the cultural variations among countries with its impact on Digital transformation.

To sum it up, digital transformation is not only about progressive improvements but rather an overall approach towards a comprehensive digital business founded on digital technologies. Through connecting business development literature and digital transformation challenge literature to technology, business transformation can then be pursued with the key dimension’s markets, products, business models and processes in mind.

Traditionally, there have been a set of universal processes in UAE that every person has to consider when starting a new business. Such processes include having a strategic business idea, having knowledge about the market, the existence of a gap in the market, having a marketing plan, and finally capital. Nevertheless, there has been an additional component that is increasingly drawing attention as a critical part to starting a business which is digitization. The challenge with digitization is that it cannot be packaged into a single component like say social media. Digital aspects have grown exponentially in business, and what is today considered the best technology may not be the best in a years’ time.

From the literature, it is evident that as a result of Globalization, digital transformation is increasingly being perceived as an opportunity for a competitive edge. Companies in every sector are striving to adopt technology and although constrained by capital, firms still believe in technology. However, it is important to point out one regretful finding, where management and leaders are not cognizant of challenges during the implementation of a digital transformation strategy. It is obvious that technology alone won’t bring overnight success to a company if employees are not on board.

Technology know-how was pointed out in the review as a major impediment to digital transformation. As much as a majority of the current generation of professionals are technologically aware, it is important to train them on specific technologies especially given that they are the target business users. Complex technologies such as artificial intelligence require comprehensive training before employees can be onboarded into any system of such kind.

The industries pointed out in the literature consider digital transformation as a vital business development strategy. But what most of the researchers fail to point out is digital transformation with a purpose. Companies that adopt the wrong technologies for instance could suffer more in terms of losses of capital and impacts on customer goodwill. As such companies must be concerned about undertaking an informed digital transformation journey.

The studies also failed to mention that technology changes rapidly and a strategy that gives a company some competitive edge today may be a liability in a year regardless of the costs of ownership. On specific example in the Banking industry is adopting a technology with security loopholes and whereas a result of such vulnerabilities, criminals exploit and steal customer funds. In such a case, a digital transformation journey earlier considered as an opportunity for a competitive edge becomes a liability costing the company loss of funds and loss of customer loyalty. Firms should thus be careful before embracing digitization and perhaps seek assistance from consultant’s experience in similar processes and consider the impact of industry trends.

Within the digital age, digital transformation has gained immense attention from researchers and practitioners alike. It offers advancements with the aid of digital technologies to deliver formidable engagements with customers or offer opportunities where firms can benefit from streamlined processes. The study explored digital transformation and operations management, understood the strategic enablers and challenges for digital transformation. The study indicates that indeed a digital transformation is a huge opportunity for businesses trying to improve the management of their operations.

Nevertheless, the enablers could vary between organizations. Inherent challenges still exist with regard to how digitization is operationally linked to operations management in emerging and growing economies such as the UAE. Future studies need to concentrate on specific research items where businesses are studied based on their contribution to the economy. Given the fact that there was limited literature available on Digital transformation in UAE, this study proposes that the next studies should first come up with realistic strategic frameworks that will help companies in growing economies to digitally transform their operations. Empirical research could also explore both technical perspectives and people with regard to examining the digital transformation challenges in UAE.

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