Companies worldwide are projected to spend $1.78 trillion on digital transformation in 2021 alone. Despite the reports of low success rates and unmet expectations, it is obvious that most companies believe that they should get on the bandwagon in one way or another. Having recently covered the main reasons why digital transformation attempts fail, we feel it is about time that we focus on the common points in the stories of companies that succeeded in their digital transformation attempts.
IT might be expected to lead any tech-related process in a company, but that does not apply to digital transformation. Digital transformation is too complex and multi-faceted a process for a single department to oversee. Since it is more than a technical renovation of the existing system or installation of new software, it cannot be solely left to the IT—the C-suite members are the ones that should lay out the vision, scope and goals of the process, define what success will look like and assure key stakeholder buy-in. Nothing can be transformed without commitment from the top-level leadership.
In order to be able to set realistic goals and define key parameters, top management needs to have a clear understanding of the current situation. This is all about setting a baseline and gaining a clear bird’s-eye view of all the data available in the system. Eliminating data silos and integrating the whole corporate data give you that. Once your roadmap is formed, this integrated data structure will help you create standardized decision-making procedures and eventually automate decision-making processes regarding certain situations.
Breaking your digital transformation project into shorter sprints and setting actionable goals for each sprint ensure your control over the progress being made. Just like Rome was not built in a day, you, too, will be building your success one brick at a time. Moreover, defining limited, meaningful goals will help keep your team motivated as opposed to working towards a distant, vague “nirvana state” nobody in your organization truly believes in. Harvesting the low-hanging fruits first and scoring wins that are limited in scope is a much better option than aiming for the best but failing completely.
Chasing the perfect strategy during digital transformation that will take you to the “nirvana state” we talked about can turn the whole thing into a never-ending saga—you are more than likely to get stuck in the analysis stage without being able to take much action. Sometimes just “good enough” should suffice so that you can focus on other areas where you can make high-impact changes. It is a folly to think that something perfect can be achieved right away at the start of a digital transformation. One should be mindful that progress will take a series of iterations and constant adjustment.
Making big software and hardware purchases that rarely deliver the promised benefits is never a good idea in digital transformation projects. Not only it is a waste of money, but it also causes the illusion that the management has done its part by picking the tab without doing much else and that things should be radically different with new tech stuff in place. Digital transformation is not about acquiring the latest fancy technology but business disruption—modifying your processes and finding new ways of engaging with your customers.
A successful implementation does not mean that the challenges of digital transformation are over. As the company adapts to the market conditions and the competition, this whole process will have to be revisited and modified—it is never one-and-done. The costs, complexity and uncertainty involved could be intimidating for both decision-makers and employees, and have the process put on hold for a long while. For such cases, our friend Bruce suggests another way.