Digital transformation is the process of using digital technologies to improve existing business processes or create new ones.
Going digital has a myriad of benefits, allowing companies to increase speed and efficiency while reducing costs.
Companies just getting started have the advantage of being “born digital” but older or already established entities must embark on digital transformations or risk getting left behind.
Why do it? A useful analogy is the VHS/DVD rental industry.
Back in 2000, CEO of Netflix Reed Hastings offered to sell Blockbuster CEO John Antioco his business for US$50m.
At the time, Netflix ran a DVD mailing service which Antioco considered to be “very small and niche”.
Netflix spent the next few years creating an online digital library of streaming content.
The rest is history. Blockbuster filed for bankruptcy in 2010 and today, Netflix is worth over US$130bn.