Ecommerce stores handle millions of unique transactions every day, capturing each buyer’s information to make future purchases easier and providing a direct contact method for the proprietor. Brands engage with customers and instantly join global conversations through social media. Meanwhile, 'big data' generated through all this online activity allows corporate leaders to make better strategic decisions than ever before.

It's incredible just how much the commercial landscape has evolved over the past two decades and the change is even more astounding looking at the past five years. Digital has changed how businesses work in every industry. Despite this, whether it's due to the rate of change or an inherent resistance; many organisations are yet to grasp the potential benefits of digital technology, continuing to use business models that haven't adapted to today’s marketplace.

In a study undertaken by Capgemini Consulting it was discovered that firms who had established digital as a priority, referred to as 'The Digirati' in the report, were on average 26% more profitable than their industry competitors. 

The same report titled, "The Digital Advantage: How digital leaders outperform their peers in every industry" demonstrates that the retail and banking sectors have taken great strides towards digital mastery, whilst utility companies and manufacturers still lag behind.

Where this may be true internationally, the Middle East still has some way to go before being able to sit amongst 'The Digirati'. However, looking at the online consumer profile of any GCC country clearly shows that the environment is ripe for organisations to truly benefit from a process of transformation which places the consumer front and centre.

Taking Bahrain as a single example, in a study carried out by Northwestern University in Qatar, it was reported that the average time spent on social media channels every day on the island is 4.1 hours, with 93% of users stating that they have a Facebook profile, 72% using Twitter and 61% using Instagram. With internet penetration at 90% and always growing, these are very clear signs as to how the world is moving.

In the coming years, any business that does not adapt will find itself at a significant disadvantage.

What is Digital Transformation?

Digital transformation represents a comprehensive process, which aims to give organisations a competitive edge through better integration of technology and modernised business models. Altimeter Group, a specialist research group based in California, summarise digital transformation as:

“The realignment of, or new investment in, technology and business models to more effectively engage digital customers at every touchpoint in the customer experience lifecycle.”


No two programs are alike, as every company has different needs, but there are usually four main focus areas.

Strategy – Determining the goals and priorities of the transformation

People – Identifying required skill sets, training employees, and changing company culture

Processes – Revising core processes and migrating them to a digital format

Technology – Acquiring the necessary software, platforms, and tools

What are the benefits? Altimeter's report outlines that organisations that achieve a high level of digital sophistication greatly enhance their mobility, intelligence, and capabilities. For example:

The benefits of Digital Transformation

A 49% increase in sales generation and leads, a 46% greater conversion rate, 53% higher traffic across digital touchpoints, 63% improved customer service satisfaction and a 75% lift in customer/client satisfaction. 

Where Most Organisations Get It Wrong

Of course, the transition to a more digitised business model is fraught with challenges, especially in big corporations. When a company starts along the path of digital transformation and experiences lacklustre results, it is usually caused by one of two main factors.

Lack of top-down leadership – This is when a business focuses entirely on upgrading technology, creating social media profiles or developing new websites for instance but without a comprehensive vision of how these moves will help in the long run. For the transformation to begin to be successful, highly committed executives must determine the objectives, oversee the creation of a detailed plan, and ensure organisational follow through. Otherwise, a unified and coherent program is impossible.

Unengaged leadership often results in waste, incompatible technology choices, and few significant changes to how the company operates. There is no synergy, divisions and teams continue to work in silos and the benefits to the business are limited.  

Overly cautious decision-making – On the other hand, some organisations have vision and active leadership, but are unwilling to take risks. These conservative businesses are sceptical of any new technology, preferring to wait until it has become more widespread, and insist on closely governing each investment. Most of the time, they will focus more on cost reduction than innovation. 

While this approach helps avoid potential mistakes and waste, it can also hinder progress. They miss out on valuable opportunities, and any moves towards digital transformation are slow and underwhelming. Of course, delayed and poor results lead to a lack of confidence which often in turn, leads to management reverting back to what they know, budgets are reduced and projects that could move a company forwards into the future grind to a halt.

Digital transformation can provide immense value to organisations of any size, but it cannot be successful without effective leadership and the right plan.

The earlier a business prioritises digital, the more comprehensive the integration, the more it stands to gain. Consumers in the region are more than ready and are leading the way, it's up to us to ensure that we are prepared to move with them in order to stay relevant and to secure a place in their lives.