Digital transformation

What it means

Digital transformation is changing how a company works through digital tools. It is not about buying a new program but about rebuilding processes: from paper documents, spreadsheets and email to connected systems, automation of repetitive work and decisions based on current data.

The first step is usually document digitisation: invoices, contracts and statements are processed electronically rather than by hand. Next come connected systems, for instance the online shop, warehouse, invoicing and accounts linked through an ERP, and automation using workflows or RPA.

Success depends on people, not technology. A new system that staff work around because they do not understand it or it slows them down changes nothing. That is why change management is part of the transformation: explaining why things are changing, training and gathering feedback.

How it works in practice

With clients we start where there is the most manual work and the most errors. Typically that is receiving supplier invoices, matching payments or attendance records. When documents are collected electronically and matched automatically, the books are up to date and the director sees the state of the company continuously, not a month later.

When systems change, data migration and its timing are key. We recommend switching to a new accounting or ERP system at the start of an accounting period, with opening balances checked and the old system running in parallel for the first months.

Digital transformation also has a tax and grant side. Software and implementation are depreciated or expensed straight away depending on their value, and calls from EU funds or the recovery plan are often available for digitalising small and medium-sized firms.

What to watch out for

The most common mistake is digitising a bad process. If invoice approval stalls because nobody knows who should approve, an electronic system just gets to the dead end faster. Simplify the process first, then automate it.

The second risk is dependence on one vendor and closed formats. A company should be able to get its data out in readable form and keep document archives as the law requires, even after changing systems or ending a contract.