Is Digital Transformation the Next Industrial Revolution?

Author: Mohamed Fathy – IT Department at EFG Hermes.

Digital change is expected to be the next ‘Industrial Revolution’ in terms of size, effect, and doorways it opens for financial institutions — at least for those who show up for the revolution on time. Those who don’t are now facing the risk of not only trailing behind competition but complete operational shutdown. A total of 1,183 out of 1,559  CEOs surveyed by the Massachusetts Institute showed ‘extreme certainty’ that  digital renovation will become vital for their firms in the coming two years. So digital transformation doesn’t become a question of ‘if’ for financial institutions, it is a question of ‘when’.

Firms begin their digital transformation journey for multiple reasons: to advance their efficiencies, to enter a new market, or to change their business model entirely. But digital solutions like data analysis, data engineering, IOTs, Industry 4.0, community media, and more, require complete organizational change regardless of the motive behind their implementation.

With technological transformation and disruption happening every day, digital transformation is not quite as linear as industrial change; it requires constant evolution, several layers of change, and consistent efforts. It is an iterative process, so while several financial firms could all start their transformation journey simultaneously, results will vary based on their level of digital maturity.  Importantly, however, firms must understand that digital transformation will not be achieved overnight; it takes time to be addressed and digested and should be represented in a digital maturity framework beforehand.

What differentiates digital transformation from industrial innovations, however, is that it covers all businesses and penetrates all borders. It alters the method by which companies perform daily operations by creating a novel digital ecosystem. Technology is considered an enabler, but the real emphasis should be on the strategic outcomes and organizational culture change that must happen to accompany it.

Have you started initiating digitalization where you work yet? There is no better time than today.