Digital ROI- The value of Digital investments!

Every industry is being affected by how digitization is changing and how businesses operate, reach out to clients, and go to market. However, the necessary digital transformation is difficult, costly, and time-consuming, and it affects every part of the business. Therefore, in order to get the most out of their digital investments, businesses must actively plan and track them. To that end, every business should develop a process and governance framework via which they can monitor and assess their digital innovation and return on investment, as well as the value they are generating. Customers, employees, operations, safety and soundness, infrastructure, and disruption and innovation should be the six main strategic focus areas that this method should be applied to across the entire organization. 

 It is essential to create metrics that are directly related to the overall strategy and objectives of the business in order to measure digital ROI both statistically and qualitatively. However, success cannot be guaranteed by a solid procedure or good governance alone. Digitization has the ability to profoundly alter how work is performed in organizations.  Focusing on the digital experiences of both customers and employees, quickly testing ideas early, rewarding the willingness to take risks, managing the disruptive effects of digitization on your operations and culture, and taking a comprehensive approach to how digitization will affect your business are key components of digital transformation. Measuring digital ROI at every stage of the process is the only way for businesses to successfully manage the process and achieve their strategic goals. 

 The secret to the digital ROI methodology is assessing and managing digital investments across six strategic emphasis areas, including infrastructure, disruption and innovation, customers, workers, and operations. Each focus area has associated metrics and key performance indicators (KPIs) that enable businesses to more accurately track and gauge the effects of their digital initiatives, re-evaluate the implementation process as needed, and hold teams accountable for their contributions to the achievement of the desired transformation goals. 

Some illustrative steps for the companies to capture and measure digital success can be summarized as: 

1] Paying attention to online experiences: Pay attention to online experiences. Starting with and maintaining a constant emphasis on the types of digital experiences your customers and workers expect is crucial. In order to understand how your consumers and employees will connect with one another and what experiences they need, want, and expect, it is essential to use human-centered design, which puts the individual at the center of the interaction. 

2] Co-create: The digital future is always a company-wide endeavor, thus it must be created in cooperation with all parties involved. 

3] Align optimization, innovation, and disruption: Companies all too frequently focus on improving the efficiency, effectiveness, and engagement of their present processes. Of sure, that matters, but it won't guarantee success in the digital sphere on its own. 

4] Transform business, not the technology: Create what we refer to as "experience drops": the skills, resources, and data required, at the appropriate moment, to significantly influence consumers' decision-making. 

5] Take the business perspective: It is crucial to maintain an enterprise-wide perspective on how each investment fits into the desired digital outcome given the size of the digital investments that businesses must make in order to succeed in the digital world, as well as the often bewildering wealth of options as to where to focus those investments. 

Thus, the digital ROI framework can give businesses the comprehensive perspective they require to achieve a quick, effective, and orderly change while upholding their strategic objectives. MBA Graduates today need to understand this long, complex process of creating digital value. 

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Blog compiled by 

Dr. Priyanka Darekar, 

Indira Global School of Business