What Is Business Transformation? Definition and Types

Max 7min read

What Is Business Transformation?

Business transformation definition:

Business transformation is an opportunity to declare a bold goal beyond incremental change—to reimagine your company and operating processes to deliver breakthrough value. It entails making planned decisions on where you’ll expand, how your company operates, and what types of performance enhancements you may expect. In other words, business transformation is a change management approach that may include any shift, realignment, or significant change in business transformation.

The term “transformation” is on the hotlist, yet it can signify different things to different people and businesses.

All transformations necessitate a rethinking of how your company generates value now and in the future. To put it another way, all changes necessitate substantial thinking.

“In a world that changes so quickly, the one approach guaranteed to fail is not taking risks,” says one expert. — Let’s keep this in mind as we walk you through the business transformation process.

Rapid business transformation has become necessary for enterprises to stay up with the transforming workplace over the last five years, especially in light of the COVID-19 epidemic. 

A recent study found that over 70% of large-scale conversions fail, and most executives continue to be concerned about transformation risk.

The goal is to facilitate the company’s alignment with its business strategy and vision by changing processes, people, or systems (technology).

Digital Transformation vs. Business Transformation

Let’s take a brief look at digital transformation now that we know what business transformation is.

Because every company’s digital transformation will be distinct, it’s challenging to find a universal description.

But it is the integration of digital technology into all elements of a business, radically changing how you operate and give value to clients, known as digital transformation. It’s also a culture shift requiring firms to challenge the existing quo, experiment, and learn to accept failure.

The difference:

It is evident that business transformation and digital transformation are inextricably linked and vital to a company’s success. Without either of them, a company’s relevance and competitiveness in the market will dwindle.

Company transformation refers to a cultural shift and the basis of business operations where the market changes influence. Organizations can use business transformations to identify market obstacles, capitalize on evolving technologies, and adapt their business practices.

The tools and technologies used to change a company are digital transformations. It also covers business processes, one of the critical areas of overlap.

The market and go-to-market models are at the center of business transformation, whereas

the technologies that support the above business operations focus on digital transformation.

What Are the Types of Business Transformation?

Remember that a complete corporate transformation can only be accomplished if all sectors receive equal attention. The most significant types of business transformations are listed below.

Management Transformation

New generations have reinvented hierarchical structures and internal relations. Rigid systems and an excessive number of intermediaries stifle progress and make it more difficult to develop true talent. Furthermore, a more flexible leadership paradigm with collaborating forces may rapidly adjust to future changes.

Organizational Transformation

This type of corporate transformation entails changing how workers work in a company. General management is in charge of this ever-changing process, which focuses on the workforce.

Cultural Transformation

For long-established businesses, this may be the most challenging shift, and it entails a change in both individual and collective mindsets.

Information Systems Transformation

The transformation of a company’s information systems is at the heart of its change. All information management resources, including technologies, processes, and personnel, are included.

Why Is the Business Transformation Needed?

A business may explore a transformation for various reasons, including new technology, market shifts, poor profit and turnover, or a merger and acquisition.

Changes within an organization are the business transformation. As a result, during these projects, good change management is critical. You can track, measure, and analyze the changes you’re making and see how they influence the entire workplace with effective change management.

What Are the Benefits of Business Transformation?

In every industry, technology has become a critical commercial resource.

Business transformation improves customer experiences, reduces time to market, and more when applied across the enterprise.

Please continue reading to discover the primary advantages of business transformation and why it is a worthwhile investment.

Connected Systems With Better Management and Automation 

It also enables you to begin automating regular procedures that eat up too much of your staff’s time, preventing them from progressing on high-value projects.

While IT management and payroll link with automation, they can also apply to human resources (HR), marketing, customer relationship management, and sales.

New Digital Capabilities Improving Customer Experiences

Customers will benefit from new digital capabilities and improved products and services once you’ve prioritized business transformation and made efficient workflows part of your usual processes.

Responsive Service To Increase Customer Loyalty

Transformative processes also enable your company to respond more quickly to client and employee input.

Improving Market Share While Staying Competitive

The more your company plan supports cross-functional collaboration employs significant data insights to improve the customer experience, and updates business operations regularly, the more competitive you’ll be.

How To Prepare the Business Organization for Transformation?

The transformation has become the rule, not the exception, because of the rapid speed of technological and market-driven disruptions.

If you want to prepare for a successful business transformation, you’ll need to look beyond the project’s specifics and assess your company’s overall culture. You’ll need to develop transformative fitness, which is the ability to adapt and thrive in a fast-changing environment.

Here’s what you’ll need to do to get your business ready for a successful transformation:

Recognize External Disruptors

Use both human and technological resources to assess the external forces threatening to change your market.

Develop Internal Leaders.

Culture and transformation success are both dependent on leadership.

Create a Culture of Flexibility.

“Move fast and break things” is not your goal. You will, however, require a robust mechanism for identifying and reinvesting learnings from both successful and unsuccessful attempts. This will aid in the development of internal intellectual property and agility for your company.

Keep Technology in Mind. 

What impact will technology have on your company’s long-term growth? This question will determine your ability to deal with future upheaval.

What Are the Steps in Business Transformation?

Every business change is unique, and there are critical steps in any change management strategy.

The following should be included in a business transformation framework:


An organization that wants to transform will envision how they enjoy its enhanced firm look. All stakeholders should be on the same page with the vision, strategic goals, and business case.

Developing a plan begins with determining where the company wants to go, where it is now, and how to bridge the gap.

Establish Authority

It is critical to appoint leaders to oversee and support the transformation initiative. A Programme Director supervises the transition and ensures it runs successfully, on time, and under budget.

Scoping and Planning

A defined strategy will guide the creation of a precise transformation roadmap that will help you realize your company’s vision.

Set up a Program Management System.

The Programme Director can establish program governance, supervise all stakeholders involved in delivery, and modify and flex the transformation roadmap to keep the program on track by setting a Programme Management Office (PMO).

Create a Resource

You’ll need the appropriate executive capacity to make things happen at each level of your company transformation project. It all boils down to the relevant people in the correct positions at the right time.


Business transformation is a process that can take months or even years to complete; nevertheless, the journey truly begins once you take the first step.


Once the change executes, the business transformation program does not terminate. It takes time and effort to embed and integrate new ways of working or systems into an organization.

What Are the Critical Aspects of a Successful Business Transformation?

Delivering a successful corporate change is not easy.

It is critical to recognize the need for change and know when to act. It’s one thing to have a leader who is willing to take on the task of change but never overlooks the necessity of having a leader who understands what traits are required, which ones they possess, and how to fill any gaps. Because structure and resources are essential for success, appointing a sponsor and program team to oversee the transition is critical. 

It’s vital to agree on a clear vision of your evolving business with all stakeholders.

With this, it concludes our blog; you now have a comprehensive grasp of business transformation.


What is the purpose of business transformation?

The goal is to improve the company’s alignment with its business strategy and vision by changing processes, people, or systems (technology).

What are the examples of some successful business transformations?

Organizations such as IKEA, Nike, and McDonald’s, to mention a few, are examples of business transformation.

Why do business transformations fail?

Insufficiently high goals, a lack of involvement inside the business, and a lack of investment in establishing capacities throughout the organization to sustain the change, among other things, are all contributing reasons. According to research, around 70% of transitions fail.

Crafting great product requires great tools. Try Chisel today, it's free forever.