Business Growth Insights

Revealed: The Secret Digital Transformation Metrics

Digital Transformation Metrics

Written By Richard Mawer

Richard is the founder and CEO of Ignite Growth Consultancy, he is an expert in digital marketing, strategy, sales, processes and systems. Also the author of the #1 Amazon best selling book "Remarkable Business Growth", he has been helping small business owners to grow to £1m turnover and beyond for the past 25 years using his proven STEPS Growth Methodology.

A successful digital transformation process needs to be a thought out, organisation-wide program – and one that is rigorously measured as it progresses.

Failing to quantify digital initiatives using pre-determined metrics is a big mistake. Without a proper monitoring system in place, you could lose out to more agile competitors. 

Key digital transformation metrics to address

According to the Harvard Business Review, companies waste up to 70% of the money they invest in digital transformation.

By tracking digital transformation metrics you’ll invest your money and resources where they have the best outcomes and avoid wasting time on measures that aren’t adding to your bottom line.

However, pinpointing exactly which metrics to have on your radar or how to gather them can be challenging. 

To get you started, here are six broad markers – with tips on collecting them – to help you accurately assess your digital progress:

1. Digital adoption 

One way to measure the success of digital transformation is to compare the number of software licenses you’ve purchased with the number of employees who are using the software. This gives you a sense of the adoption rate of your investment. 

If 90% of your licenses are being used, the tool has been widely adopted. If, however, 40% are being used, digital adoption could be a barrier to your digital transformation success. 

Other metrics to use are:

  • How many employees are using the software efficiently e.g., are they using all the relevant features correctly?
  • What’s the total time saved with software usage?
  • Project completion times: have efficiencies been made? 

2. Customer experience

One of the main goals of digital transformation is an improved and constantly improving customer experience (CX). A shift to digital engagement allows you to create more intuitive, consistent and streamlined experiences for customers – and guide prospects towards conversion. 

To monitor the impact of digital approaches on your CX, establish metrics around: 

  • User engagement at different touchpoints in the buyer journey
  • Percentage of conversions per digital channel
  • Percentage of drop-offs at every stage of the digital journey
  • Customer acquisition rates
  • Customer satisfaction
  • Churn rates
  • Customer retention rates
  • Average lifetime values

These metrics (as opposed to bounce rates, traffic or leads) provide a clearer idea of engagement and a user’s experience of interacting with your business. 

To track customer satisfaction, use customer feedback and surveys. You can also look at your support ticket volumes and resolution rates to see if your business processes have made it easier for customers to do business with you. 

digital transformation metrics 02

3. Productivity

The digital automation of manual tasks improves productivity, allowing each employee to generate higher revenue and profit over time.

To determine whether new digital tools are improving the productivity of your teams, ask the following qualitative questions:

  • Are employees able to optimise their working hours?
  • Has increased automation given your team more time to focus on more strategic tasks?
  • Is it easier for employees to collaborate and work more efficiently?

Once you’ve answered these questions, use the following KPIs to check for operational productivity:

  • Overall performance of employees
  • The number of tasks automated
  • Revenue generated per employee

4. Company morale

As digital transformation takes place, it’s essential to understand the implications for your company culture.

Digital transformation cannot take place unless employees are motivated and believe in your vision, so measure team morale via both qualitative and quantitative feedback.

Undertake employee feedback surveys – have you increased staff engagement?

And monitor your staff turnover – have you decreased your re-hire rates?

5. Operating expenses

The tech infrastructure you’ll need to support digital transformation comes at a cost. And this is acceptable – but only to the point that you see a clear net benefit.

Keep an eye on operational costs and in particular the relationship of operating expenditure to new revenue produced by your digital transformation. 

6. Rate of innovation 

Two key digital transformation metrics to use to judge performance are ‘growth efficiency’ and ‘rate of innovation’. These measure the return on investment (ROI) of the technology-related changes to your business model and product offerings – and ultimately determine the effects of transformation on your business revenue. 

Digital innovation strategies matter more than investment size when you’re measuring digital transformation.

Innovation is determined by products and services that offer something new. This could be a new digital product or an existing product that introduces customers to a digital approach to boost their experience. 

key takeaway

As we have seen, measuring digital transformation is fundamental to its success for your business. Yet, according to Gartner almost half of all organisations have no digital transformation metrics to measure digital performance.

It’s all too easy to get caught up in a ‘shiny new thing’ mindset when it comes to new technology and tools. Meanwhile, the nitty-gritty of metrics and KPIs – the information that provides a clear picture of your progress and the impacts of digital on your business – are often neglected or actively avoided. 

Don’t fall into this trap. Without a framework to measure your digital transformation, success is far from guaranteed. 



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