BUSINESS TRANSFORMATION
A Successful Digital Transformation: The Essentials
An increasing number of organisations are climbing the digitalisation bandwagon as technologies mature and the benefits of digitalisation become evident. In the rush to catch up with the leaders, it is quite natural for companies to want to dive right into the transformation. But there is a considerable risk of taking on too much too soon and being stuck with a sizable investment with no returns in sight. According to multiple surveys, on average, only 33% of the expected revenue benefits were realised for digitalisation initiatives.
What would be a plan of action that maximises organisations' chances to succeed in their digitalisation venture?
Before drawing out any plans for digital implementation, organisations must first define what they seek from digitalisation. The expected goals across the impacted functions should be documented with the consequent long-term impact on growth. Why is this so important? Most organisations will have multiple problem areas that need fixing or improvement as an utmost priority. And taking on all of them together is not feasible, it is not a pragmatic approach either. Listing out the goals, be they client satisfaction, cost reduction, risk reduction, or employee engagement, will allow all the voices to be heard. Getting all the stakeholder leaders to discuss, score, and prioritise the goals will help get everyone on the same page and help create a consensus and a cooperative mindset. Additionally, examining the short-term and long-term impacts of the goals will help organisations prioritise the goals based on expected returns.
Once the organisation knows where it wants to be, it is important to focus on analysing where it is. Companies must examine the costs and risks by journey, process, and other categorisations. They need to look at existing processes from various data perspectives. For instance, businesses need to analyse the customer journey based on customer satisfaction data and look at it from the lens of operational data. Gathering the data about the various functional processes from multiple aspects helps identify the gaps that can be filled by digital solutions to reach organisational goals. Linking the current problem areas to possible digitalisation solutions helps create a list of use cases.
Use cases that are viable based on existing data and IT maturity and can also provide quick and high value-added returns should be the start of the implementation phase. The business case for use cases and their requirements should be presented to key stakeholders, highlighting the total value to be gained. Enlisting stakeholder support and approval is vital for success, as digital initiatives are bound to create cross-functional upheaval. A disruptive approach to implementing new and unfamiliar technologies is high cost and risk. A brick-by-brick roadmap with manageable milestones builds momentum with each success and enables an agile approach to the undertaking.
A digital transformation involves managerial challenges across levels and functions. Since it impacts processes, strategy, and capabilities, a positive mindset needs to be created at an organisational level. Ensuring that primary stakeholders are involved in setting the direction and monitoring progress will go a long way in getting the broader organisation on board. A cross-functional central team should helm the digital transformation and have regular communication and frequent updates for stakeholders defined as an integral element of the operating procedure. Cross-functional teams are vital to create acceptance and impact and break up silos of information. It is crucial to have a forum to discuss employee misgivings and report feedback and issues.
Digitalisation is a long and arduous cycle of analysis, prioritising, redesign, implementation, and going live. There are bound to be unexpected and manifold challenges related to design, technology, and people. The team has to win over resistance to change at every turn. Every win, big or small, is a huge victory. Each one deserves a wholehearted celebration. The leadership should take advantage of every opportunity to show appreciation and boost morale. The celebration will also help erode reticence for the next series of implementations.
Cutting-edge technology implementations are an adventure into uncharted territory. So, a few setbacks, along with the wins, are par for the course. Setbacks should not dominate the narrative of the digitalisation journey. It is critical to treat setbacks as learning opportunities and quickly redirect energy into the next phase. A stock-taking session to document the learnings from the unsuccessful attempt will help prevent recurrence and provide closure. Leadership support and encouragement will boost morale and focus the team and the organisation on the next win to come.
Organisations on their digital transformation journey must gear up for continuous, long-term effort. Getting the basics right will go a long way in easing the path.
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