If you’re considering selling your business, a key step in the process is to of course determine its value. This can be a complex procedure that requires you to seek outside counsel from fellow industry experts and professionals who live and breathe the deal market. However, if you’re finding that the valuation being offered is leaving more to be desired, undergoing an internal digital assessment and transformation could be an important strategy to increase your business’ value.
A digital transformation is about more than just upgrading your devices. A digital transformation aims to integrate technology into all areas of your business. When done effectively, it radically changes how your business operates and how you offer value to your customers. A successful digital transformation is evident in more streamlined operations, enhanced products, or services and, ultimately, an improved bottom line.
Authority Brands Chief Financial Officer, Silpa Velaga, emphasizes implementing a digital transformation strategy to enhance your business and increase its value by giving insight into Authority Brands’ own experiences. She references how Authority Brands has put automation and analytics at the forefront, which creates value for both internal stakeholders and franchise owners. “By removing manual processes, allowing for access to real-time data, and aggregating that information in a manner that is easily digested, time can be better spent on moving the needle in your business that will add value.”
Some of the dashboards created provide consistent reporting for franchisees of Key Performance Indicators (KPIs), such as sales trends over time, benchmarking, and ROI on marketing initiatives. Elaborating further Ms. Velaga says, “by providing KPIs using technology we help the owners better grow their business, which in turn generates revenue for us [the franchisor].” This type of technology also increases efficiency and value because “[franchise] owners can focus on execution without having to spend time interpreting the data.”
A digital transformation will take different forms based on the business executing it. However, here are four basic tactics to help get you started.
- Assess your current customer experience.
- Define your goals and objectives.
- Seek out technology resources that help you become more effective in achieving your objective.
- Recognize your employee’s fear of being replaced and include them in the process.
Ms. Velaga goes on to note that a digital transformation also has long-term benefits, as it gives the business a broader strategic picture. This enables the business to be more agile in reconfiguring its overall strategic approach, reacting to trends in real-time. Being nimble is even more necessary today in the wake of the COVID-19 pandemic that left many business owners reacting to or crumbling under the unprecedented global landscape. As we inch closer to a post-COVID-19 world, Ms. Velaga says that now, more than ever, “a buyer is going to want to know how [you] used technology to support the operations of the business.”
For examples of how other businesses are leveraging a digital transformation to increase their value, take a look at “Going Digital Quickly Is a Priority for Private Equity” by the Franchise Times.