11 Apr What is Digital Transformation and Why Does it Matter in the Downstream Oil Industry?
Digital transformation. I’m sure if you asked most people in the industry what that meant, they’d most likely reluctantly answer with something along the lines of ‘getting your hands on more technology’.
Really, it’s about adapting to the needs and behaviours of your clients and employees, then embracing digital strategies that make it easier for clients to interact with you and employees to work with each other- not just what tech you’re using to get that work done.
Digital has transformed how we shop, listen to music, read the news, have food delivered, order our taxis and now even the way you buy and sell bulk diesel. Your clients are becoming fully immersed in the online space now.
There’s no denying that consumer habits in personal time spill into business processes eventually. If someone buys their furniture online at home, they will look to buy their office supplies online, too. When people find a more convenient way of doing things, that process becomes habitual. And when it becomes habitual, it will always be done that way- in the office or out.
Due to the nature of it, ‘digital transformation” varies with every business. So, what does it mean for your business? How do you take the idea and implement it into strategies that will benefit your clients and your employees? It’s easy to think of the short term negatives of a digital transformation, that’s why it’s very much a forward-thinking game.
Here, I break down the concept into meaningful parts and provide iron-clad tips for how your business can begin to develop an effective digital transformation strategy.
There are 3 main points to bear in mind when considering your strategy.
- Innovative: Another daunting word that’s easy to say, but more difficult to approach. A quick Google brings a number of varying definitions. ‘Executing an idea which addresses a specific challenge and achieves value for both the company and customer’ was the most fitting one I found. When looking at executing your digital transformation, make sure the new tool ticks the boxes for both you and your clients.
- Customer-centric: This is mentioned above, but it can’t be stressed enough. Remember, a digital transformation isn’t just having your hands on the latest technology- it’s about transforming the way you work to adapt to the changing needs of your clients in a way that benefits your business and your team.
- Data-driven: Becoming data-driven becomes an integral part of your digital transformation. Nearly all technology options today collect incredibly useful data that you can put to use in making future business decisions that you weren’t able to analyse easily before. Not only does it give the option to analyse what’s happening externally, but it gives you a clear picture of where and how to improve within your business too.
Being digital in the oil and energy industry essentially opens yourself up to change and allows you to withstand its ever-increasing volatility quickly by being more agile. Like a tree in strong winds, your trunk (the foundations of your business and goals) stays put, while the branches (market movements and client behaviours) move in the wind without breaking. (A solid analogy there, I know. It was between that or being as fluid as water.)
So, you may agree that digital transformation is necessary, but you may not think it’s urgent. Maybe sales are strong despite an unpredictable winter and now doesn’t seem like the time shake up your operations. Or maybe things have been quieter than expected and a digital transformation definitely isn’t a priority right now.
But, there are a few reasons to embrace the digital future sooner rather than later.
- Engaged employees. Businesses with a digital strategy give employees the power to use data to measure and improve performance along with increased learning opportunities.
- Increased profits. Businesses can expect to grow revenues by 23% as a result of adopting digital strategies like using data to make smart decisions and training employees in emerging technologies, optimising current processes and making it easier for your clients to interact with you.
- Avoiding the competency trap. Current success doesn’t continue indefinitely if you keep your methods the same. When long-term growth strategies become less of a priority you could soon find yourself continually making decisions for short-term survival when you’re scrambling to adapt- putting out fires as they say. If you have to change eventually, why wait until you have to.
- Unbreakable resilience. Digital technologies are always adapting to the market. By using an independent platform, you’re essentially hiring a team to conduct market research on your audience and what features they need, for a minimal monthly cost in comparison to doing this in-house. Updating inflexible processes to meet consumer demand used to be expensive and time-consuming; digital helps your team escape this loop and enables your business to adapt quickly to demands and stay ahead of the competition.
Once your competitors hop on the bullet train of productivity, it can be hard to catch up. Equally, you can be the first on board and have them playing catch up (I’m not even sorry for this analogy). It doesn’t have to be a radical change in one go. Just a few small changes can get you on track and start the wheels moving. We’re releasing version two of our platform very shortly which houses the fundamental features to get you started. You can click here to find out more (or even request a demo above).
Starting sooner enables you and your team to get comfortable with using technology to help build processes that are adaptable. Be comfortable with change.
Remember- Your mission is to build the capacity for your company to adapt, and even predict, the transformations in the digital ecosystem- your core offerings and principles remain the same. This isn’t a race against your competitors, it’s about addressing your clients needs, and although these will constantly change, it will be predominantly digital and being digital allows you to adapt much quicker.