How can organisations really start reaping the benefits of digital transformation? Tom Needs, COO at Node4, outlines his top five tips
These days, asking an IT leader to explain their digital transformation strategy to you can be enough to cause them to tense up and begin to sweat. But why is this?
The term ‘digital transformation’ has been used so widely and often over the past couple of years, that it’s becoming to be known merely as another buzzword. Forrester has even gone as far to describe it as a term that has, “come to mean so many things that it’s almost meaningless” – but digital transformation is still very real, with Gartner suggesting that 79 percent of corporate strategists believe it is “reinventing their business”. And, as it is behind a huge amount of change in the global economy, these days, you’d be pushed to find an organisation that doesn’t have some sort of digital transformation roadmap.
However, digital transformation means something different for every business that begins to undertake it, and it’s important organisations take into consideration the company’s purpose and limitations before buying into it.
One way to do this is to simply take a step back from the technology. The Enterprisers Project CIO community has shared three core principles that businesses should be thinking about achieving when it comes to digital transformation – “rethink old operating models”, “experiment more”, and “become more agile in your ability to respond to customers and rivals”.
Taking these points into consideration, then, businesses can start to refine the approach they are taking when it comes to digital transformation and discover what specifically the term means for themselves. It’s certainly not an easy task, but it is the best way for organisations to begin to move forward. With this in mind, here are five steps to consider, to help demystify digital transformation:
Potentially the most vital place for organisations to begin before beginning their digital transformation strategy, is understanding the key business drivers and strategic priorities. It takes more than just ticking digital transformation off the to-do list – the strategy needs to focus on the business’ objectives, benefitting the company overall.
Additionally, it’s important to measure the level of change the business is able to effectively resource and drive, as change that is brought about by digital transformation is more than just upgrading technology or increasing IT investment. Research published by McKinsey illustrates the considerable effort required, arguing that technology is “only one part of the story”. Success depends on some radical activity, from reimagining the workplace and upgrading the organisation’s ‘hard wiring’, to changing the way you communicate. Not only do businesses need to have the ‘digital savvy’ leaders, but they also need to build relevant talent and skillsets throughout their organisations.
Looking at the bigger picture also requires a readiness to learn lessons from those who report success, to ensure that digital transformations do not “fall short in improving performance and equipping companies to sustain changes.” This has happened to many a digital project as, for example, an organisation has been unable to sufficiently update entrenched, analogue business processes to support a whizzy new digital customer interface.
Businesses need to recognise external pressures and challenges covering key areas such as their markets, processes, regulatory environment, competition, and supplier and customer ecosystems.
