New report details best practices for companywide digital transformation

Over the past two decades, the internet has redefined how businesses operate. Yet new insight from Formstack and Mantis Research finds that many modern companies still struggle to bring the benefits of today’s digital age into their often-outdated manual workflows. 

Formstack’s 2022 State of Digital Maturity: Advancing Workflow Automation report reveals that just 4% of companies have reached digital maturity in regular workday operations. And while a majority of businesses are incorporating digital practices, fewer than a third are refining those operations, meaning there’s still lots of work to be done to operationalize organizations in the digital age.

We surveyed 2,000 knowledge workers at businesses with more than 100 employees to compile this report. The survey gauged an organization’s level of digital maturity by asking questions based on four guiding pillars:

• Company culture: management, innovation and adaptability
• Workflow digitization: use of paper forms and documents, reasons for digitizing processes, and involvement in workflow automation
• Technology: tech stack, no-code tools, tech purchase drivers, and tech audits
• Team alignment: building workflows, sharing learnings, and communicating across departments

Based on these pillars, surveyed organizations were sorted into four stages of digital maturity, from lowest to highest: limited, invested, refined and optimized. While a majority of organizations (96%) haven’t reached the optimized stage yet, there is good news in that nearly 60% of businesses are investing in digital operations, with at least half of their documents or forms being digitized. 

So why are companies with a vested interest in digital transformation still lagging, and how can they get on the right track? Business leaders and professionals can use this report and its data-based suggestions as a roadmap toward digital maturity.

Why are organizations falling behind?

The business world is overwhelmingly moving towards digital-first processes, with the global digital transformation market expected to exceed $1 trillion by 2025. Although the pandemic accelerated digital transformation, many companies have since halted digital spending after achieving their “must-dos.” This choice leaves many “should-dos” unaccomplished, leading to less effective internal processes and workflows.

It would be easy to assume that lack of budget and IT resources are the main reasons organizations struggle with workflow automation, but in reality, these are fairly low on the list. The number one culprit for companies falling behind is the attitude: “This is the way it has always been done.” In fact, 59% of respondents in the limited stage reported this being their biggest struggle with advancing workflow automation.

But the procedures that accelerated business possibilities or streamlined workflows a decade ago can hamper progress and scalability in 2022. Interestingly, our report found that more than half of employees spent at least two hours a day on repetitive tasks. In many cases, employees fulfilled their tasks counterintuitively because “that’s the way it has always been done.”

Two hours might not immediately concern you, but consider this: If the average annual wage in the U.S. is $53,383, one employee wasting two hours per day on inefficient tasks costs your organization about $13,345 a year. Across an organization of 100 employees, those seemingly unimportant “two hours” add up to more than $1.3 million annually.

Without a suitable framework for digital maturation and a strong commitment to change, businesses may ultimately fall short of optimal performance for their employees and customers.

Why should businesses care about digital transformation?

Consumer loyalty and employee satisfaction are particularly important given inflationary pressures and workplace trends like the Great Resignation. Today’s atmosphere is not conducive to manual, outdated processes, especially when those processes alienate employees.

Our report found that 76% of employees are frustrated by inefficient workflows, and 86% prefer digital processes over manual paperwork. And many employees indicate that paperwork remains their most frustrating and repetitive task. When employees are frustrated, their productivity plummets, and they are more likely to experience burnout or consider a new position. On the other hand, digitally mature companies eliminate routine and frustrating tasks to foster a work environment that attracts and retains fully engaged employees.

Employee satisfaction also bleeds into customer happiness. Employees can meet and exceed consumer expectations when they have the time to focus on non-menial tasks. Digitally empowered employees can also focus on higher-impact initiatives that drive business metrics like improved consumer loyalty. Just as important, satisfied employees are more likely to anticipate business roadblocks and proactively seek methods to overcome issues.

How can businesses move toward digital maturity?

Digitally mature companies exhibited six practices in Formstack’s 2022 State of Digital Maturity: Advancing Workflow Automation report. Consider these methods and the steps you can take today as you chart your roadmap toward digital maturity. 

Build a culture that embraces change

Digitally optimized organizations tend to welcome innovation and independent thinking. More than 80% of employees at such companies said they are regularly encouraged to test new ideas, and 60% said they function with autonomy. Independent thought also fosters collaboration: Digitally optimized companies operate inter-departmentally, with 94% of employees who work for optimized organizations indicating they often share ideas with colleagues outside their department.

Reaching a place where employees continuously innovate and operate independently requires overcoming your internal inertia to keep everything as-is. Leaders can turn inertia into motion by gathering data on where to focus their efforts. For example, most organizations lower on the digital maturity scale aren’t tracking data like:

• What manual processes can be automated
• What workflows need updating
• Which systems cost the most to maintain
• Which systems consume the most employee time

Without visibility into these areas, companies can gain a false sense of security, believing everything is working as it should. These companies struggle the most with inertia, as they’re the least likely to agree that they should track these data points.

Moving up the digital maturity scale requires a shift in the “this is how we do things” mindset. Leaders must embrace change and support a culture that empowers employees to innovate beyond the status quo. This kind of culture welcomes data and technology into the workplace to improve processes and advance operations.

Prioritize eliminating paper

Most organizations, regardless of digital maturity, have significantly curtailed paper use. More than two-thirds of surveyed organizations boast an initiative to eliminate paper. Most respondents indicated that paper-free processes are a priority for efficiency’s sake, but the benefits of eliminating paper go beyond a quicker document pipeline. Paper-free processes also improve security, data accuracy and customer and employee experiences.

Knowing these benefits, what processes are organizations still running on paper? Employees indicated that potentially sensitive documents requiring a signature — such as legal forms, healthcare records and insurance processing — remain the most common offenders.

Companies can start by digitizing those types of documents. Then leaders should audit their processes to find other places where paper forms and wet signatures slow down operations.

Focus on improving the customer experience

Customers increasingly expect an intuitive digital experience, and digitally mature companies are taking notice. More than 80% of respondents from optimized organizations said improved customer experience is a high business priority, compared to just 40% from non-optimized companies. Meanwhile, 30% of limited-stage companies find it very challenging to meet customer expectations (compared to 19% of optimized organizations).

Customers and staff prefer digital processes over paper, and organizations must adapt to this expectation. Companies need to seek and better understand various preferences among their customer base and use that information to boost the customer experience. 

By adopting more digital processes, organizations can collect valuable customer feedback and behavioral information to build an even stronger, more beneficial experience that ultimately leads to more revenue. Organizations can also adopt digital tools that ensure rapid and clear communication with customers through streamlined online forms or responsive, automatic customer service. It’s crucial to develop a high customer service standard, particularly regarding response speed, as efficient communication is the most effective way to maintain customer loyalty.

Use automation to reduce busywork and turnover

Two-thirds of digitally optimized employees spend an hour or less on inefficient tasks daily. That’s about half the time employees at less digitally mature companies spend on menial and repetitive tasks. And that can save about $6,600 per employee per year.

Efficient workloads also contribute to a happier, less stressed and more productive work environment, alleviating burnout and retention issues. Only one of four optimized businesses find it challenging to retain employees, while three out of four other organizations indicate that retention is a recurring issue.

“Automating workflows is a way to free those valuable team members to focus on serving client needs, rather than spending hours on work that is necessary but may not add much value or allow them to contribute in the way you originally employed them to do,” said Matt Bourn, founder of fivexfive. “Identifying ways to minimize mundane tasks boosts employee satisfaction and contributes to your overall business goals.”

Leaders should devote time to reviewing workflow processes for inefficiencies. Often, productivity pitfalls arise in data collection and storage or information sharing. Automating common processes, like data transfer when completing a new document or transferring documents to a centralized storage location, will immediately improve the employee experience.

Remove technical roadblocks

A set of well-integrated tools is crucial for automating and streamlining workflows. Every digitally optimized organization included in the survey reported using at least one tool for workflow automation. This likely explains why optimized organizations report fewer delays caused by a lack of technical resources. Optimized organizations also report less trouble getting new technology approved (66% of employees said the process was “easy”) compared to limited-stage organizations (23% of employees said the process was “easy”). 

Simply adding tools or people isn’t guaranteed to fix inefficient systems that bog down IT teams. Audit your tech stack to identify roadblocks, like the tools that take the most time to maintain. If a tool provides little operational value or is too time-consuming to manage properly, consider removing it from your workflow. After streamlining toolkits, IT teams can allocate their time more productively. Forward-thinking businesses are also consistently exploring new tools and using an easy approval process to get those tools operating quickly.

About 70% of respondents from optimized companies said their organization purchases technology intended to solve current issues and future problems, whereas 91% of limited-stage respondents said technology is only purchased “as the need arises.” As the tech talent shortage makes hiring extensive technical support staff more difficult, digitally optimized businesses opt instead to provide accessible tools to all employees across departments.

No-code software such as WordPress, Parabola, Formstack, Shopify and Zapier let non-technical and technical employees build applications and automate workflows without writing a single line of code. In doing so, organizations are able to unlock more of their workforce as more employees are able to solve problems and impact the customer experience.

“No-code tools are super beneficial because they allow you to move fast. There are so many projects that never get prioritized because IT and engineering don’t have time. With no-code, non-technical independent contributors can be trained to build automations and internal tools [themselves],” said Sahil Khosla, engineering manager at Lightyear Health.

But just 3% of limited-stage organization employees said their company had adopted no-code tools. And 64% of respondents without access to no-code tools said they would like to be able to use them. 

Business leaders looking for faster workflows and accessible tools must prioritize adopting no-code software. 

Digital maturity starts now

The future of work is digital. That’s why all organizations should prioritize digital maturity, and the first step is identifying where you land on the digital maturity scale. A newly created 13-question digital maturity assessment offers organizations a look at where they stand in their digital transformation journey. If your organization isn’t where it needs to be for today and tomorrow, now is the time to make changes. 

Reaching digital maturity requires an organization-wide evolution across people, processes and technology. It takes dedication, consistency and strategy to advance, but it’s well worth the investment. Over time, you’ll see digitization efforts resulting in satisfied customers, happier employees and an overall more efficient organization. 

Chris Byers is CEO of Formstack and currently serves on the board of Nexus, a nonprofit organization focused on building businesses and nonprofits seeking a deeper social impact on the environment.