The right digital strategy for businesses comes from their internal environment?

The importance of the digital transformation continues to grow, with companies from all sectors and of various sizes subject to this influence. To remain competitive in the future and nowadays, companies must recognise and overcome the opportunities and challenges of digitalisation in the long term. To do this, companies can develop an entire digitisation strategy that affects all business areas, enabling them to achieve a holistic digital transformation and ensure their survival in the digital age. The use of new technology is a source of competitive advantage for businesses in this modern era. Moreover, it has also been a key aspect of economic resiliency in the face of COVID-19, with digital tools being a key part of the response for many countries. The main definition of digital transformation is "the process of using digital technologies to create new — or modify existing — business processes, culture, and customer experiences to meet changing business and market requirements."

Digital Strategy Development

First of all, corporations must recognise the strategic role of new IT services and technologies and be able to develop and exploit them. In this case, it is crucial to use technology that already exists on the market or act as market leaders by creating new technology. Comparatively, this change leads to changes in the creation of added value, as these impact the entire value chain of companies. They have to ask themselves about the extent to which their new activities deviate from the classic, analogue core business and which markets or customers are targeted. Additionally, the integration of new technology and the changing value creation requires a suitable organisational structure to successfully implement the challenges of the digital transformation and the associated tasks. Lastly, to realise these changes, financial aspects have to be considered again through the latest businesses' strategic plans because "financial aspects are both a driver of and abounding force of the transformation". The financing of the digital transformation can be done from both within the company and outside through external opportunities. For this change to be successful, all the above must be aligned.

Technology Tools for Digital Transformation:

• Mobile technologies: 81% of manufacturing CEOs see mobile as strategically important
• Cloud technologies: 78% of companies agreed that the cloud's penetration of the manufacturing industry would be a major factor in the next five years.
• Internet Of Things (IoT): 75% of large manufacturers update their operations with IoT and analytics-based situational awareness
• Artificial Intelligence (AI) / Machine Learning (ML): latest report from Research and Markets showed that in the next five years, there is going to be roughly $19 billion in annual global investment
• Robotics: 40% of the manufacturing industry is believed that will be implementing smart robotics in the next two years

Internal Environment

The internal environment can be defined as an environment that consists of various factors like human resources, the value system of the organisation, physical resources, organizational structure,?mission, vision, and objectives of the organization. The factors of the internal environment of an organisation are the below ones:

1. Organisational Structure is how the information flows in a corporate environment and defines the composition from the board of directors, high levels of management and shareholders. As a result, the structure influences the decision making, and more levels of management mean more delays.
2. Human Resources are the employees and labour working in a company and are the most crucial asset to an organisation because success depends on HR.
3. Value System, which is also known as the philosophy of the company, contains work processes, culture, norms, climate, or in simple words, the way it treats its employees and customers.
4. Physical Resources consists of the machinery, tools, and all other tangible assets of an organisation. This means that innovation is significant for the strategic plan and the success of an organisation.
5. Vision and Mission play an essential role in deciding the future position of the corporate and its place in the market.
6. Corporate Culture, also known as organisational culture, defines the beliefs, values, and assumptions followed by the management and employees of a company. It influences the employee's interactions with one another to how important decisions are made in the organisation.
7. Financial Resources define the income or total capital of a company. It is crucial because a corporation with financial stability can expand its businesses or can explore new markets.
8. Technological Capabilities are the resources that imply the technology used in the organisation and obtain a competitive edge over their competitors.

To conclude, as clearly identified above, an approach to obtain a competitive advantage from the firm’s internal environment and emphasizes the resources which have developed to compete, which emerged after the major works from Penrose (1959), who suggested that the resources possessed, deployed and used by the organisation are more important than the industry structure.?Last but not least, there is ahead of a clear opportunity for companies to achieve sustainable growth and welfare improvements for their employees and customers by making digital a key feature of theirs strategic policies.