Digital Transformation:
Leverage Technologies
with Purpose

Industrial companies must improve growth and profitability with a portfolio of innovative digital solutions that work together to transform how physical products are engineered, manufactured, and serviced.

What Is Digital Transformation?

Digital transformation (DX) is a broad business strategy, applicable across all industries, to solve traditional business challenges and create new opportunities using technology. It requires acceptance of entirely new ways of working and delivering value to customers.

Investment in digital transformation has been steadily growing; industrial companies are investing at least 5% of their annual revenue on digital transformation projects and are increasing budget every year. IDC forecasts $2.8 trillion in global spend on DX technologies and services for these programs by 2025. Industrial digital transformation is leveraged to achieve strategic, operational, and efficiency goals across the enterprise. The most successful strategies align DX goals with business value.

A solid foundation for DX success begins with identifying the most pressing problems impacting financial and operational goals and measuring the value of resolving them.

Digital transformation is rooted in the physical parts of the enterprise – products, processes, people, and places – and through the strategic adoption of technology, it’s enabling competitive advantage.

Why Is Digital Transformation Important?

Digital transformation is important because disruption is a given and competition is fierce. Digital technology has disrupted every industry, from media and energy to healthcare and transportation. As a result, it is imperative industrial companies reimagine their work methods, workforce, and even workplace. Investment in digital transformation has been proven to improve efficiency, maximize revenue growth, and reduce operational costs so they can be prepared for the next disruption.


Why is digital transformation a business imperative for industrial enterprises?


Worker Shortage

The industrial markets have millions of jobs unfilled due to a growing skills gap.


Risk & Cost Pressure

Global companies are facing increasing macroeconomic and cost pressures.


Digital Disruption

Traditional enterprises are threatened by the rise of digital business models.


Our research shows 92% of industrial companies are executing digital transformation initiatives—but what is the goal? Across a wide range of projects, the goals focus on three areas of benefit: cost and efficiency, growth, and quality paired with customer experience.


Reduce costs to improve efficiencies

The lowest barrier to entry with DX is finding efficiencies, driving productivity, and reducing costs. According to Gartner, 62% are adopting a cost-first mindset for digital transformation initiatives.


Drive exponential growth through product innovation

Organizations are investing in areas with high growth and attainable market share. Initiatives include reducing time-to-market, introducing new products and business models, or increasing throughput.


Improve quality and engage customers

Becoming customer-centric is essential to remain competitive. To differentiate, companies are improving product quality, creating unique customer experiences, and delivering higher levels of service.

The Vision of Digital Transforms Physical

With digital transformation, the power of digital technologies is being used to transform what is and what will remain physical. In this video, President & CEO Jim Heppelmann offers a glimpse into our evolving product line-up and its powerful capabilities. Learn how CAD, PLM, IIoT, AR, and SaaS are powering digital transformation now and into the future.

What Are the Types of Digital Transformation?

The reasons and drivers of digital transformation are as varied and nuanced as the companies pursuing it. However, there are five main types and often these types are interconnected. For example, implementing a new technology-led process requires new thinking and collaboration from employees, which requires cultural transformation.

  1. Process Transformation
    Redefining processes to achieve greater efficiency and reduce costs.
  2. Product and Service Transformation
    Driving faster product innovation and improving service delivery.
  3. Growth Opportunity
    Expanding into emerging areas with high-growth potential and attainable market share.
  4. Cultural Transformation
    Creating an organizational culture that fosters collaboration and alignment.
  5. Customer Experience
    Improving product and/or service quality and building superior customer experiences and engagement opportunities.

Digital Transformation Challenges


More than one-third of executives cite the lack of a clear DX strategy as a key barrier to achieving full potential. Developing a DX strategy aligned with business goals and built to enable measurable value is essential to success and program longevity. Our DX framework provides a 5-step process to identify value and kick-start your strategy.

Data Alignment

Three-out-of-four executives say improving the ability to leverage data across the enterprise would be effective at addressing disruption. Gathering, organizing, and democratizing your data unlocks greater potential for DX outcomes. Enabling a digital thread allows critical data to be accessible across functions and roles.

Speed & Scale

Manufacturers on average start with eight digital transformation projects, with 75% of these failing to scale. To overcome this pilot purgatory, combine a value-led DX strategy with strategic partners and out-of-the-box solutions. This will set the business on the right path to achieve impact quickly and scale across an organization.

Digitization vs. Digitalization vs. Digital Transformation

Let’s clear up some common semantic confusion around these three distinct efforts.

The capturing of information about the business, products, and processes in a digital form. For example, scanning a paper document, keying in datapoints into an Excel spreadsheet, etc.

The application of digital technologies to improve or implement functional processes that take advantage of data being in a digital format. For example, designing a product in a CAD environment instead of on a drafting table or collecting and analyzing manufacturing data via an IoT platform instead of manually.

Digital transformation:
The large-scale reorientation of business processes, workflows, and even strategy made possible when several interconnected functional processes have been digitalized. For example, leveraging IoT and AR to reinvent your service business, or adopting digital performance management as a cornerstone of driving manufacturing productivity.

Dive Deeper on Digital Transformation

Digital transformation is an opportunity for industrial enterprises to lead their industries, capture market value, and drive efficiencies across engineering, manufacturing, and service. Ready to get started? Start with these blogs.

Build an Effective Digital Transformation Strategy
Why Companies Are Pursuing Digital Transformation
5 Digital Transformation Examples
How PTC Helps Industrial Companies Win

Build an Effective Digital Transformation Strategy

Start your DX journey by developing a foundation for success. Learn the 7 steps necessary to create and execute an effective DX strategy.

Why Companies Are Pursuing Digital Transformation

See the transformational ways DX is contributing to strategic, operational, and financial initiatives for companies worldwide.

5 Digital Transformation Examples

With the right technology and partners, enterprises are leveraging a breadth of digital technologies to transform the physical aspects of their business. Learn about five real-world examples here.

How PTC Helps Industrial Companies Win

At PTC, digital transforms physical. Learn how PTC supports our customers in digital transformation—it is both our purpose and our passion.

Sign Up to Receive the Digital Transformation Newsletter

Capitalize on Digital Transformation

Curated for industrial c-suite leaders, keep abreast of digital transformation developments with the latest insight on business and technology strategy via hand selected research and executive summaries for easy consumption. Sign up to receive this newsletter, issued every other month.

Please wait while your request is being submitted...