It has never been harder to successfully run a business. Under typical conditions, roughly half of all small businesses fail within the first five years. Now, business owners are navigating a global pandemic. State and local governments are restricting operations and issuing broad stay-at-home orders.
Even iconic American companies are now failing. JCPenney, Gold’s Gym, and California Pizza Kitchen are amongst many companies to file for bankruptcy and close stores.
Now is the time to reduce overhead and become as efficient as possible. Many companies are relying on a digital transformation strategy to survive.
Read on to learn how business technology can reduce operating expenses. Explore digital tools that are certain to generate sales leads and help your company beat the odds.
What Is a Digital Transformation Strategy?
Before diving into solutions, it is important to define what a digital transformation is. It involves a radical overhaul of the traditional business organization.
Instead of relying on old structures, digital transformations leverage modern tools and technology. The goal is to optimize the business model and reduce direct labor expenses. Below are a few ways to digitally transform your business model.
The days of huge buildings with a large in-person staff are over. One positive development of the coronavirus pandemic was that it accelerated a shift to remote working.
For workers who can perform their duties from home, 71% transitioned to telework. The majority of these workers want to work from home permanently after the pandemic ends.
In line with digital transformation, you may have to provide employees with the tools to work from home. This includes software, hardware, and other items to allow for maximum productivity.
This is a win-win for both employers and employees alike. You can reduce overhead by employing a remote workforce. Your utility expenses are going to decline and you need less office space.
The next step in your digital transformation is adding virtual staff. For example, many businesses are replacing receptionists and secretaries. Instead, they are using virtual assistants as part of their digital transformation strategy.
The same concept applies to in-house accountants. Instead, a growing number of companies are using virtual bookkeeping. This is an effective way to keep overhead expenses down while retaining accounting expertise.
Even executive roles and responsibilities can be fulfilled with a virtual solution. Take a virtual Chief Financial Officer (CFO) as a perfect example. Without factoring in bonuses and benefits, a CFO costs your company up to $200,000 per year. For a fraction of this amount, you can bring on a virtual CFO.
A virtual CFO prepares budgets, forecasts, and analyses. They also develop internal controls and are responsible for strategic planning.
Essentially, your business gets the financial expertise without the excessive recurring costs. Virtual bookkeepers and CFOs also bring innovative accounting tools to use for your business.
A Recap of Digital Transformation
The best way to survive this economic climate is by rethinking your business. It is crucial to make structural changes to optimize your business model and reduce expenses.
One effective way is to consider using virtual employees such as bookkeepers. If you are considering a digital transformation strategy, contact us today to speak with an expert.