Digital transformation is a useful strategy for any of your business goals and brings about benefits that affect your entire organization. Boards of Directors and C-Suite executives are seeing the improvements digital transformation has on their organizational goals, with 56% crediting these solutions to a substantial increase in revenue shortly after implementation. However, budgeting for digital transformation initiatives has routinely been a hassle for organizations. High costs of digital adoption keep some facilities from starting, while too small of a budget has organizations falling flat on their business goals.
Budgets for digital transformation are not something to take lightly. They need to be deliberate and realistic enough to solve the issue you’re wanting to overcome, while also being conscientious to your overall revenue to keep others from overspending, but still responsive to any unforeseen expenses.
In general, budgeting is no easy feat, and budgeting for something as obscure as digital transformation can be a real struggle. weavix™ has advised organizations in effectively budgeting and collecting resources from other areas, like your network and radio budgets, to maximize their efforts and get the best solution for their goals. Understanding digital transformation and how to best prepare for it, both operationally and financially, sets your organization up for higher rates of long-term success.
Identify Everything Affecting your Digital Transformation Budget
At weavix™, our digital collaboration capabilities break down silos throughout the frontline, so we understand that nothing in an organization happens in a silo. That includes your digital transformation budget. With this in mind, it’s important to identify everything affecting your budget to not only ensure what you’re allocating is an appropriate and feasible amount but to also hold your teams accountable by way of financial boundaries. There are plenty of things to consider that can impact your digital transformation budget, and we’ll cover a few examples here.
Your Organization’s Goals
No two digital transformation budgets are the same, and that’s because the budget is highly dependent on the goals you want to accomplish. weavix™ specializes in cost-effective, frontline digital transformation, which goes on to affect every part of your organization. But we’ve noticed organizations have found resolutions to problems related to finances, operations, safety and more, all through our digital transformation platform.
What you are trying to accomplish through digital transformation ultimately affects the budget you allocate. Goals can vary widely from pushing for more frontline efficiency to upgrading your existing legacy network throughout your facility. Both goals are valid, and something weavix™ can help accomplish, but the budgets for each initiative will look completely different. After careful research and consideration of your desired end result, budgeting for digital transformation initiatives becomes less of a challenge.
The Scope of your Digital Transformation Initiative
Similar to the goals of your organization, the scope of the project also affects your digital transformation budget. As we said in our Digital Transformation 101 blog, digital transformation looks and sounds different depending on whom you ask. It can be as simple as adding a sensor to pumps outside of your facility or optimizing your frontline workforce by outfitting every worker with a smart radio. With these examples, the scope of each is vastly different, even though they fall under the umbrella of ‘digital transformation’. When determining your digital transformation budget, the scope is just as important as your organizational goals.
Your Timeline for Implementing Digital Transformation
Digital transformation is a process, and for some organizations, it never ends. While this is a good sentiment, there should always be a timeline, no matter how flexible or rigorous it may be. At the very least, the implementation should have an end date. Continuing to fund a project with no real end in sight keeps your organization from seeing the actual value it produces, and upper management and executives will want to see that value fast. Implementation is one of the most difficult stages of digital transformation, but organizations continue to see compounding benefits long after, but only when done correctly.
Choosing to pursue a digital transformation initiative with weavix™ ensures a swift and seamless implementation to adhere to your internal timelines and show value immediately. However, implementation is only half the battle: your budget must also include recurring payments when applicable. weavix™ acts as your partner through the entire digital transformation process. From implementation to following recurring payments, we allow for your digital transformation budget to remain steady with transparent and consistent forecasting, without surprises.
The Expertise and Resources Available
One thing that affects your digital transformation budget but oftentimes gets overlooked in the planning stages is the resources you have available. Do you have someone on staff that can lead this initiative, or will you need to bring in temporary help from outside your organization, like a consultant? If everything can be managed in-house, you shouldn’t accumulate additional costs within the budget, but it might affect your timeline or scope. Your digital transformation budget doesn’t live in its own silo, and many related and unrelated factors can affect it.
The digital transformation experts at weavix™ advise on accomplishing your organizational goals and plan solutions, including scope, timeline and budgets, to optimize the frontline workforce. To learn more or get started, contact us.
Decide Which Payment Method Works Best for your Organization
After you’ve identified the things that affect your digital transformation budget, it’s important to plan how your organization will pay for it in the end. Many larger projects fall into two types of expenses: CapEx or OpEx. Just like your budget, these expenses will be based on many factors, including your organization’s goals and existing financial processes.
CAPEX or OPEX? What's the Difference?
The difference between a capital and operational expense is simple to understand. Capital expenses, often called CAPEX, are often used to fund projects concerning fixed assets, like property, plant and equipment (PP&E). With them, you put down a large sum of money (or capital) upfront to purchase what you need. There aren’t any recurring payments, and all later maintenance, upgrades and repairs are the buying entity’s responsibility.
In a Software-as-a-Service (SaaS) business model, operational expenses, or OPEX, are more common. Rather than one large sum of money up front to own the new equipment, OPEX breaks the expense into a recurring payment, often monthly, to license and use the software solution for as long as needed. Concerning your digital transformation budget, OPEX has three key benefits:
- Oftentimes, there’s no large payment due to get started
- Your budget can stay consistent and steady through the contract of your license
- Accounts for hardware replacements, repairs and upgrades, and continuous software updates
How weavix™ Fits into a Digital Transformation Budget
weavix™ utilizes the OPEX payment model for our solutions. As a subscription service, our platform gives collaboration capabilities to every worker throughout your facility and comes with our managed service plan. weCare™ takes the stress out of maintaining, repairing and upgrading your devices, and instead lets weavix™ do it on your behalf. Following an OPEX model allows us to fit into nearly any digital transformation budget.
Deciding between a CAPEX or OPEX solution depends on your desired outcomes and the solutions available in the market. Keep these options in mind when researching what will work best for your organization’s goals and while planning your digital transformation budget.
Digital transformation budgeting is not an easy task, but having one sets your organization up for success. The most important thing to remember when planning your digital transformation budget is to be thoughtful, flexible and realistic with your goals and resources. If your goals include building a safer, more efficient frontline, the digital transformation professionals at weavix™ are ready to help.
Contact us today and see how our solutions optimize your frontline workforce.
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