As the IT channel evolves, it highlights the need for channel businesses to incorporate digital transformation in their own evolution.
We refer to transformation, particularly digital transformation a lot on this blog. Perhaps that’s not surprising – it’s a rather relevant topic these days as it seems to pervade almost every aspect of business at the moment, on both a macro and micro-level.
This theme of transformation is also relevant to achieving a range of business objectives, such as the following from both general and more specific perspectives.
General: Transform because you have to, or face extinction
Specific: Traditional IT operations are fading, and the channel is evolving into something new
We’ve written at length about the need for businesses to pay attention to the increasing digitalisation of the business environment in which they operate, and adapt themselves accordingly. Not doing so ultimately results in failure. This is true of businesses within the IT channel as well. Channel businesses are facing a range of industry specific pressures such as cloud, increased competition, smaller distributor and reseller margins, increased barriers to entry, digital marketing and direct vendor engagement by the end-customer. Transforming their operations digitally enables channel businesses to better deal with these factors.
General: Transform to grow and make more money
Specific: Decouple cost via digital customer service
One of the big advantages of digital is the ability to scale efficiently and decouple increasing costs from business revenue growth. By serving customers digitally, once systems and processes are established, a business can add additional customers for far less cost than a traditional, non-digital business.
General: Transform to take market share
Specific: Understand what you are not providing to your customers
Another major benefit of digital systems and operations is that they often form a solid foundation for data collection, analysis and business intelligence. Digitalized IT channel distribution platforms for example, have a natural advantage in that transactional data from all sources is aggregated within the platform. Because all channel business transactions are driven through the aggregation platform, the transactional flow of data through the distribution platform quickly builds up a valuable store of information which marketers can then direct towards their marketing and sales initiatives.
General: Transform to reach new customers
Specific: Setup ecommerce and self-service platforms for customers outside of your traditional market
Thanks to digitalization, end-customers are more educated and better informed these days than they’ve ever been. In addition to being enabled by digital technologies to conduct product and consumer research, they are also using digital channels for product fulfillment and expect suppliers to be able to deliver via these mechanisms. Those suppliers who aren’t able to meet these expectations are will be overlooked as consumers turn their attention to those who can.
General: Transform to retain your customers
Specific: Stay connected 24/7 and out-pace your customers’ digital journey
Following on from the above point, businesses need to stay connected to their customers 24/7 as has come to be expected. Consumers, digitally-savvy themselves, expect businesses to not only keep up with them but to lead them on their technology journeys as well.
General: Transform to lead the pack
Specific: History teaches us that innovation wins
According to Wikipedia, as of 31 March 2019, seven out of the 10 largest publicly traded companies were technology companies, a strong demonstration not only that the technology industry is an economic powerhouse, but also that innovation can pay handsome dividends (quite literally). By harnessing the power of new and evolving digital technologies, businesses can innovate in new ways and create and capitalize on new market opportunities.
It’s clear that digital transformation is changing businesses in the areas of speed, accuracy, convenience and the creation of new business paradigms such as the platform business. By enabling features such as software platforms which connect demand to supply, digital technologies are having a transformative effect on our collective business environment, and will continue to do so in the future.