Digital

The business world today is digital and pushes companies toward digitalization. The question on their agenda is no longer “should companies digitalize or not?” but “how should they digitalize effectively?” which is an important step for any company’s development.


Digital transformation of an organization is some kind of metamorphosis that fundamentally changes the way it works and influences its working processes, communication channels, implementation systems, organizational structure and culture. Twenty years of experience in working with clients in the consulting field made us see that you can actually infuse new life into a company with the help of digital technologies. This is why, our goal is to share our accumulated experience with others so that companies can cope with the digital challenges of the modern world, strengthen and find their own place on the modern business map.


Digital technologies are vast, while the benefits coming from them are diverse. The digital revolution connects individuals, processes and technologies in a new way and enables companies and their consumers to speak in a common language.


Digital transformation means much more than a new way to tackle problems – companies gain new values and standards through it. Digital metamorphosis implies the transformation of the company as a whole organism instead of an innovation to any separate unit or part. Based on our experience, this metamorphosis starts with a change of mindset which is later transformed into a completely new business model. Digital transformation takes place not in a specific timeframe, but presents a continuous process of development which urges companies to never stop asking questions and to be ready to meet new challenges.


Our approach


We believe that the digital world is an integral part of our future. This is why our team helps companies to connect creativity and technology in order to turn digital opportunities into a digital reality.


Digital metamorphosis of the company is based on six stages:


1


We believe that the future is created by technologies that humans harness. In the digital world, companies need individuals with a digital mindset who are able to see the power of technologies and capabilities in business. Any idea, technology or innovation is wasted without the relevant readiness, mindset, improved skills or pursuit of innovativeness.

2


Digital diagnostics empower us to assess the factual conditions of clients and their position in the digital era. With the help of opportunities and challenges identified at this stage we do an analysis to define the following steps.








3


Modern companies operate in a digital world, and their strategy should be able to ensure operation accordingly. Formation of an action strategy in the digital world at this stage may urge companies to change their business model.



4


After the formation of a digital strategy, the organization as one whole organism is being prepared for the digital transformation which includes modification of organizational structure, behavior and culture.









5


Opportunities and challenges of the digital world require digital skills. Thus, employees are one of the most crucial elements of the digital metamorphosis. The following stage is dedicated to the development and improvement of employees’ digital skills.



6


The result of a digital mindset, strategy, organizational culture and the culmination of employees’ digital skills unite around one common goal which reflects on the digitalization of the organization.




Digital Diagnostics arrow

Our team assesses a company’s condition, where it is at any given moment and to which direction it wants to move toward/develop. During this process, we also observe a company’s technologies, data systems and driving force – individuals. By incorporating this complex approach, we study the organizational culture, leadership forms and management methods. This process helps us to study the company in an in-depth manner as well as factors related to it. After assessing the internal ecosystem of the company, we connect the external factors – we evaluate the company’s positioning and identify industry trends.


After studying the company, ACT’s team helps it to create new opportunities so that the company can embrace the challenges of the digital era more enthusiastically.

Digital Strategy arrow

We believe that the successful digitalization of an organization depends on a powerful, targeted strategy that enables companies to understand the digital world better. Based on this, we help clients gain digital advantages which can be achieved with the help of proper digital initiatives and through establishing required processes, platforms and cultures. More specifically, we empower companies to create a digital strategy roadmap which includes the following stages:

  • Formation of a digital vision – the impact of digitalization on the industry, new opportunities and competitors, selection/identification of the relevant business and operational model.
  • Assessment of competitive advantage – to identify the impact of digitalization on the competition, we identify a company’s advantages and weak spots for further prevention.
  • Digitalization for improvement – based on complex research, we identify those digital opportunities that are the most relevant to the company’s work and presents the best ways of optimization.
  • Filling in the vacuum – this is when we identify skills, systems or platforms required for achieving the set digital goals and link them to the actual conditions of the company. In doing so, we empower the company to find or create the necessary resources.
  • Transformation roadmap – we help companies in the continuous process of transformation and support them in analyzing the necessary steps to achieve clear, measurable results.
Digital Culture arrow

We deeply believe that one of the integral and crucial elements for overcoming any crisis and maximally utilizing opportunities is a team of employees. Our consultants help companies improve or create organizational environment which will facilitate inspiration, creativity and generation of new ideas. We believe that it’s man-harnessed digital technologies that define company’s success in this new, digital era. Thus, we assist our clients to recruit their human resources, improve qualification to acquire digital skills and form organizational culture. More specifically, we work on the following:

  • Agile organizational structure
  • Digital HR
  • Workspace digitalization
  • Empowering employees with digital skills
Digitalization arrow

We deeply believe that one of the most integral and crucial elements for overcoming any crisis and utilizing opportunities is a team of employees. Our consultants help companies improve or create organizational environments which will facilitate inspiration, creativity and a generation of new ideas. 


We believe that it is man-harnessed digital technologies that define a company’s success in this new, digital era. Thus, we assist our clients to recruit their human resources, and improve their qualifications to acquire digital skills and form an organizational culture. More specifically, we work on the following:

  • Digital marketing and sales
  • Transformation of sales and CRM systems
  • Analysis and optimization of business processes
  • Digital transformation of products and services
  • Digitalization/automatization of production methods
  • Digital supply/delivery chain
  • Stimulation of innovations
  • Digital platforms (e.g. CRM, ONA?)
  • Cyber safety
  • Mega data and analytics

Our approach suggests tackling specific tasks by means of digital methods as well empowering organizations to implement digital transformation. Our consultants assist companies to gain a deeper understanding of their capacities and to utilize the potential they have to create a business of the future.

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Featured Insights
10.05.2021

Crisis caused by new Coronavirus accelerated pace of digital transformation even more and forced businesses to include remote work and development of e-commerce into the “agenda”. The other side of the market – consumers remained without digital influence. E-commerce became a replacement or filler of physical shopping for them and presumably, these changes will make deep roots in their behavior and will continue in post-pandemic period as well. However, background of these processes is even more interesting – did every business mange to timely and properly respond to digital challenges, what do international statistics say and what is the vision – did the pandemic landscape of retail trade give businesses time and resources to adapt?


International trends – are businesses ready for digitalization? 

It’s been a long time since change in consumer behavior and their readiness to engage in e-commerce processes became one of the main focus of studies conducted by international organizations. For example, United Nations Conference on Trade and Development (UNICTAD) annually measures B2C e-commerce index, which combines levels of internet consumption by individuals, share of protected internet servers and data on owning accounts in financial institutions. Similarly, International Tele-communication Union (ITU) offers information and communication technologies (ITC) development index [1], which is also oriented on online shopping behaviors of consumers and channels utilized in this process. This list also includes statistical data gathered by Organization of Economic Cooperation and Development (OECD).

If we have a look at e-commerce report called “E-commerce during the COVID-19 pandemic” conducted by OECD in October of 2020, we will clearly see that online commerce is very quickly developing. According to the report, retail sales (orders) made through e-mail and internet in EU member countries increased by 30% in April of 2020 compared to the previous year. Trends are similar in USA, where e-commerce orders increase by 14%-16% (see chart N1). The said report also highlights dynamic development of e-commerce in Europe, Northern America and Asia-Oceania regions in the first half of 2020.

[1] The ICT Development Index (IDI)


Source: OECD, E-commerce during the COVID-19 pandemic, 2020, October. Calculations are based on EUROSTAT statistics. 

UNICTAD report “COVID-19 and E-commerce” published in summer of 2020 shows quite an interesting picture, incorporating experience of 257 companies from 23 less developed countries [1]. Some of the identified trends truly deserve our attention:

  • Fully digital business models (60% of third party online marketplaces) turned out to be more resistant to the pandemic than e-commerce companies that appeared relatively less prepared for new challenges.

  • Use of social media and number of web-pages definitely increased in focus countries. Rapid growth of these sales channels started in the beginning of the pandemic crisis. In this direction, Facebook platform turned out to be particularly important.

  • The pandemic intensified problems previously existing in the ecosystem of e-commerce. Delays in supply chains and logistic processes, absence of internet access appeared to be main challenge for more than 60% of respondents.

  • As noted by more than half of inquired respondents, improvement of e-commerce development policy and strategy is the top priority and needs to be actively handled.

  • The pandemic challenges affected investment capacities of companies in ICT direction. Respectively, company representatives believe that out of all support programs offered by their governments, update of the national e-commerce strategy and its promotion in the society is the most important one.

[1] These countries mostly cover Africa and Asia – Pacific Oceania regions.


Source: UNICTAD, COVID-19 and its impact on e-commerce of businesses, 2020

ACT’s role – experience from even broader geographic area 

The 2020 pandemic and economic crisis enabled ACT through cooperation with different countries and international organizations (EBRD, World Bank, UNDP, USAID) in various projects to contribute globally in increasing sustainability of business sector and identifying pandemic channels affecting them. The said projects enabled us to study e-commerce development issues in focus regions (Caucasus, Western Balkans, South-East Europe, Central Asia and South and East Mediterranean) and do a research on the impact of the pandemic on businesses. As expected, business operating in focus regions shows different types of readiness for digitalization (chart 3). However, regardless of such different results, it is important to mention the overall attitude inquired respondents had in common – small and medium-size businesses have a desire to involve in e-commerce but they hesitate because of lack or complete absence of information and digital tools.


Source: ACT Research, 345 SMEs inquired in Caucasus, 827 SMEs inquired in the Western Balkan region 

Our team had a chance to additionally study challenges of small and medium business operating in Central Asia, South-East Europe and SEMED countries during the pandemic within the scopes of the EBRD-sponsored project “Impact of COVID-19 on small and medium businesses”. As a part of the given study, we asked respondents representing small and medium-size businesses what percentage share of the company’s sales switched to online platforms after the pandemic started. Overall picture is also very interesting, as declared by the majority of small and medium businesses from the listed regions, sales did not switch to online shopping at all, while only a very small part of companies managed full digitalization. Businesses operating in South-East Europe (chart 4) appeared to be the most prepared for such transformations, this can be explained by the fact that logistic services were already well-developed and organized in this region and already established practice of e-commerce.


Source: ACT Research, 570 SMEs inquired in SEMED, 598 SMEs inquired in Central Asia and 184 SME inquired in South-East European region 

Unplanned changes with long-term results 

The new Coronavirus pandemic turned digital development into inevitable reality. When searching for answers, we clearly saw that this seemingly simple way is actually quite complex process and to pass this road, only “desire to digitalize” is not enough. Businesses had to cope with all the problems which already accompanied the process of switching to a new platform: absence of relevant experience, lack of resources or infrastructure. Even though supporting business became main migraine for every government, the majority (more than 50%) of businesses participating in different studies unanimously admit that unfortunately, their government, when working on development of priority sectors, left this part behind and online commerce still remains as unsolved issue.

It’s a fact – digitalization has not entered our lives just temporarily. These are more unplanned changes which will bring prolonged, long-term results.



Author: Lika Goderdzishvili

Portfolio lead, development consulting