The straightforward guide to digital transformation
Only eight per cent of CEOs believe their business model will survive the current levels of large-scale digital disruption.
That’s according to research by work management platform, Workfront. Chief executive Alex Shootman knows the pressure businesses are under, “and yet there is still a lot of confusion as to what digital transformation actually means.”
This guide will explain how to set goals and lay the groundwork for digital transformation, cover four possible transformation methods, explore the impact such projects have on company culture, and establish what can be learnt from high-profile digital transformation failures.
Before beginning digital transformation, organisations must identify their end goal. Beyond the clear need to remain competitive and improve market share, some companies may choose to digitally transform so they can serve their customers better, by introducing new products or services. Others may digitise to streamline internal processes or free up their employees’ time to do less mundane tasks. Take the time to outline these desired outcomes, as this will define the sort of digital strategy you should be creating.
For digital transformation to succeed it is vital to understand what can go wrong and to have a solid process in place. Mr Shootman has worked with hundreds of companies undergoing digital transformation and identified five steps to take before beginning.
For digital transformation to be successful, there will be a number of roles from many different departments collaborating. According to Mr Shootman, in the average organisation 84 per cent of workers do not know what it is their colleagues do. For digital transformation projects to succeed – this has to change. Take the time to make sure that all involved understand what everyone else is occupied with.
Technology sits at the heart of any digital transformation initiative, be it new project management software to use internally or specific digital products created to appeal to new customers. Either way, the reality is clear: if it is difficult to use, people will not use it. This is particularly important from a talent management standpoint. When an increasingly large percentage of the workforce are digital natives, in-house technology must be intuitive, or this talent will simply go elsewhere.
This is one of the most important elements of digital transformation: transparency. Everyone involved needs to understand the reasons behind such a huge project. “You’re asking people to change,” explains Mr Shootman, “if they haven’t bought into the why, it’s not going to happen.” Those at the top have to take the time to make sure the company is bought in – from board members to interns – or risk jeopardising company culture, and the long-term success of the project.
This expression, coined by Chip and Dan Heath in their book Switch, illustrates the most effective way to approach a large-scale project such as digital transformation. Just as charities ‘shrink’ what they are asking of you (“just £1 a day could make all the difference”), so is it easier to broach a big project by cutting it down into smaller steps. Once you have shrunk it into steps, shape the path by identifying where each step should go in the process.
“Imagine we are trying to cross a lake in a boat,” says Mr Shootman, “most people want to treat digital transformation like it’s a power boat, but it’s a sailboat, our progress will be serpentine.” When the maltese national airline, Air Malta, underwent digital transformation, they detailed a five-year plan. Years one and two prioritised revenue-generating activities, year three efficiency and optimisation, year four innovation, and year five will be spent consolidating all new tech and platforms. Along the way, old initiatives have been revisited, reworked, or jettisoned, as required. Identify a path to follow, but be prepared for deviations along the way.
