Digital transformation has been the most talked-about business and IT trend for at least the last half decade. Then, during the global pandemic, those organizations that had been dragging their feet with digital transformation found that they needed to act – with 80% of organizations accelerating their digital transformation strategies to meet the needs for new ways of working, reimagined customer engagement mechanisms, and new technology-enabled products and service.
10 Tips for Getting Started with Digital Transformation
This need to look beyond the new technology can be best demonstrated by looking at the various elements of digital transformation, in that the transformation efforts should work across three different, but linked, areas:
- Introducing new products and services based on both technology and data exploitation. Where these new products increase one or more of corporate reach, competitiveness, and financial success.
- Improving customer engagement mechanisms – from the initial inquiry touchpoints, through customer conversion, to retention and growth.
- Improving back-office operations – modernizing dated manual procedures and providing a supporting platform for both of the aforementioned customer-facing elements.
It allows us to take an outcomes view of digital transformation and to appreciate that while the new technology is going to enable real change, that what your organization really needs is business transformation, not digital transformation.
There’s a lot to address with digital transformation, and the associated business transformation, so where and how should your organization start? Of maybe it needs to rethink the execution of a strategy that’s already in flight.
Either way, here are 10 tips to help:
- Get everyone on the same digital transformation page. This might sound like an obvious thing to do but, because there are so many definitions of digital transformation out there, it's easy for different people to have different views on what it entails. With a good chance that they'll view the elements that best suit their agenda ahead of others. Two good definitions from the early days of digital transformation are:
“The use of technology to radically improve performance or reach of enterprises … to change customer relationships, internal processes, and value propositions” ~ Sloan MIT
“For some executives, it’s about technology. For others, digital is a new way of engaging with customers. And for others still, it represents an entirely new way of doing business. None of these definitions is necessarily incorrect” ~ McKinsey
- Gain buy-in and the needed authority and funding to drive the change. This will probably start with the need to shift mindsets related to the importance of technology and data. Then there’s a need to elevate digital transformation from something that’s done “on the side” to a properly funded and managed strategy and change program.
- Recognize that digital transformation involves significant people change. In addition to the required change in mindset, there will also be changes required across organizational culture and structure, strategy,, and people management. It’s not necessarily a case of radically changing business strategies and models though – but this will ultimately depend on the as-is state.
- Understand the connectivity between the three digital transformation elements. In particular that investments in new products/services and customer engagement mechanisms will be suboptimal, without the required back-office digital transformation.
- Appreciate that digital transformation requires a laser focus on the customer. And thus the traditional focus on efficiency-based process optimization and cost-cutting will most likely be at odds with elements of digital transformation strategies.
- Consider employing a proven business transformation framework. Plus, third-party advisory for expertise augmentation. While your organization’s digital transformation will be unique, there’s no point in reinventing the wheel or struggling with issues (and mistakes) that have been solved elsewhere.
- Understand that digital transformation will stress your organization beyond the technology. Your organization needs to appreciate and prepare for the works activities and organizational pressures related to digital transformation.
- Thoroughly assess the as-is state. Ultimately, it’s difficult to arrive at a new destination if you don’t know where you’re starting from. It’s not a case of simply identifying what’s not working, it's important to highlight the positives too because these areas can also be built upon For instance, in extending IT service management (ITSM) best practice to other service-based business operations. Plus, it’s nearly impossible to measure improvement when there is no baseline to measure against.
- Prioritize your planned changes. Create and prioritize your digital transformation scope and lock it down (although have a mechanism for changing the scope, in a controlled way, when justified). Also target, and then communicate, some early quick wins.
- Appreciate that digital transformation isn’t a one-time project/program. Instead it needs to be an on-going investment in: adding new products/services, improving customer engagement mechanisms, and optimizing back-office operations over time. As with ITIL adoption, you should consider digital transformation a journey not an end state.
So there you have it, our 10 tips for anyone looking to get started with, or to breathe new life, into their digital transformation. Would you have included any others? Please let us know in the comments.