In the Digital Transformation ecosystem, the new year of 2023 will be full of new technology, complete uncertainty, and lots to learn. The current crisis is a result of inflationary pressures, supply chain challenges, and declining consumer confidence. In order to conserve cash, CFOs need to find ways to do so. And cutting coffee in the break room might not be enough!
Since digital transformation projects are expensive and risky, they are likely to be the most effective choice. Unless they can save money from these projects. By integrating digital technology into all areas of your business, digital transformation allows you to operate more effectively in a digital economy. By transforming to a digital environment, an organization can provide better customer service and earn customer loyalty in the process. In 2023, digital transformation trends will be characterized by the following trends. It is also important to know these trends because they will influence the support levels of your existing and new contracts.
Perspective Change from Cost-Savings to Growth-Focused Transformation
In 2023, cost-focused transformations are expected to be one of the leading digital transformation trends that will affect businesses. What is the difference between growth-driven and cost-saving transformation projects? Think about Profit & Loss and visualize how these projects impact the line items. Those that focus on the expenses section of Profit & Loss are likely to be approved. Example, reduction in headcount or automation of processes.
Using cloud-native technologies or moving to the cloud? It is no doubt that they will achieve cost savings by reducing short-term capital expenditures.. The short-term availability of cash will also be assured.
Disruptions in the supply chain and mitigation strategies
As a result of supply chain disruptions, companies will need to evaluate their single source of supply. In response to disruptions to the supply chain, process and architectural changes will be necessary. In light of the increased lead times and the insecurities in the supply chain, network traceability and vendor performance data will become increasingly relevant.
Anything else? Suppliers will have to do joint forecasting with OEMs. That means suppliers will have to share more data with their OEMs – and let them know if there are any exceptions. System integration with OEM systems will facilitate collaboration between suppliers and manufacturers.
ERP Systems Moving from Large to Mid-Market Due to Cost Pressures
It’s common for ERP systems to plan for the next 5-10 years. Your forecasts may prove inaccurate due to such market uncertainty. It is no longer possible to construct forecasts based on assumptions derived from pre-COVID expectations. In addition, there is no expectation of operational capacity. It will be necessary for companies who overbought systems with that forecast in mind to degrade them.
How come? A higher licensing fee (charged by OEMs for larger systems). If that happens, the cash available might be drained. As well as margins. Consequently, mid-market systems will generate much higher licensing sales in 2023 than larger systems.
Automation of workflows
Automation is on every business’ roadmap looking to free up employees’ time and reduce errors. There are a lot of low-effort tasks teams must do, like managing vendor invoices, tracking down information, or re-creating documentation. Through automation, organizations can scale seamlessly while reducing operational costs.
The result? It enables companies to save money by increasing the efficiency of their processes and reducing administrative efforts. They will likely remain relevant in 2023 because of their cost-focused nature.
User Experience And AI-Driven Operations
Artificial intelligence and machine learning algorithms will also be able to detect anomalies that cause ERP adoption and planning issues. As well as improving the user experience through predictable workflow engines, we will enhance the user experience. New systems will be able to improve supply chain traceability and debug more quickly as a result.
Overall, this reduces training time for users and increases operational efficiency. As a result of these improvements, cloud-native systems are expected to continue to be adopted through 2023.
Build trust with cybersecurity
Cloud data protection becomes increasingly crucial as companies move their data to the cloud. In this age of hybrid work, it’s easier than ever for data to be compromised by unauthorized sharing or phishing scams.
Be transparent about how your customers’ data is being used, even if your data security is robust. Be clear about your privacy policy and only access their personal and financial information with their explicit permission. It is essential to correctly handle customer data in order to analyze it to make insight-driven business decisions.
Conclusion
Using the “digital transformation hype” pitch to woo your CFOs in 2023 will not work. It will be their duty to ensure that every penny in the organization is conserved. Cost-focused transformation is likely to be the top digital transformation trends in this year. Several people may argue that the era of ERP and integrated applications is over. Instead, it’s the reverse. The integration of solutions is expected to increase in 2023. There is a possibility that large enterprise software vendors will consume several best-of-breed applications. Hence, defining what is an ERP might be tricky. It is difficult to say how 2023 will affect us, but reintegrated applications will likely increase ERP implementation success rates. OptimizeMRO takes this as a positive sign of encouragement. And hopefully, it is for you as well.
Talk to one of our Digital Transformation specialists today!
