Sage's Support Plan provides the guidance you need to begin digital transformation in your company.
Executing a digital transformation initiative in a company of any size is a challenging task, even for the most experienced CIO. But the work doesn’t end there. Not only must the strategy be implemented, but its implementation must also be measured.
Measuring the progress of digital transformation is such a challenge that many companies avoid monitoring it altogether. They get so caught up in the excitement of launching a groundbreaking digital transformation initiative that drier issues like KPIs get pushed to the back burner.
Start of marked textSHARE IT! Discover the best key performance indicators to measure the success of digital transformation in your company.End of marked text
What to analyze after a digital transformation strategy
While digital transformation looks different for every organization, there are no universal metrics that apply to every business.
While some companies are introducing digital systems for the first time, others are migrating from legacy systems to more sophisticated cloud-based platforms . And still others are adding new applications and tools in a piecemeal fashion to complement their existing digital activities.
Furthermore, digital transformations can take place at the scale of the entire company or within a specific department. Lack of coherence in digital transformation initiatives makes it difficult to create key performance indicators.
The best KPIs to measure digital transformation
In today's business environment, technology adoption has become increasingly crucial to the success and efficiency of organizations. However, it is essential to accurately and constantly evaluate the impact of these solutions to ensure their effectiveness. In this regard, there are various indicators that allow measuring and analyzing the progress and results obtained through digital transformation.
1. Number of users in relation to the number of licenses purchased
One way to measure the effectiveness of your digital initiatives is to compare the number of licenses purchased to the number of employees actually using the software . This measure gives a basic idea of the adoption rate of your software investment.
For example, if 90% of licenses are used, it can be assumed that the tool has been adopted. If only 30% of licenses are used, lack of digital adoption is an obvious obstacle.
2. Analyze the scope and limitations of usability
Measuring exactly how digital tools are used will provide a clearer picture of the extent to which workers have adopted the tools and are actually gaining significant benefits. It is thus a way to understand:
where each individual user has difficulties in the processes,
What features are being underutilized?
and how to improve usability.
3. Productivity indicators
Digital transformation is not a one-off initiative. Every digital investment made must support the broader goals of the business strategy.
There are many ways to measure the impact of digital transformation on overall strategy. One of them is productivity , which is generally understood as the volume or value of results in relation to the time and resources invested .
For example, if you've invested in a digital customer support tool, you can measure how many more support requests your team has been able to handle since implementing the new system.
4. Percentage of new revenues attributed to digital investments
Similar to measuring productivity, you can measure the extent to which digital investments impact revenue .
For example, if you introduce automation into your communication email list customer journey, you can track how many potential customers interacted with your tools and compare how many of them converted into paying customers.
Internally, you can see how various digital tools support efforts to attract more business or improve operational efficiency .
Factors that determine the success of digital transformation
The above metrics are among the most fundamental to implement during any digital transformation effort, but they are not the final say on KPIs. There are other factors that can affect which metrics are chosen, including:
Digital transformation program objectives . The stated objectives of a transformation effort will be the primary areas to focus on when developing metrics. These objectives should be quantifiable, measurable, and directly tied to improving specific business outcomes.
External circumstances . Today’s business environment is continually changing, and those changes often dictate the direction of digital transformation efforts. Since the modern business world is moving at such a rapid pace, business transformation programs must remain adaptable and agile to the extent possible. This also means that the measures themselves must be prepared to adapt to external circumstances if necessary.
