With only ~20% of organizations successful in their Digital Transformation (as reported by Forrester / covered in my last article), what are we doing wrong? Well one of the problems is we don’t clearly understand what Digital Transformation is. In fact, just last year Forrester reported only 26% of CEOs have a clear vision for digital.

Let’s look at key misconceptions we all have about what Digital Transformation is. Apologies up-front for oversimplification of something quiet complex. Read these as questions / guides, not definitive judgments.

Myth 1: Digital Transformation involves or is achieved by adopting the latest tool / technology (e.g. new website / ERP / CRM)

I know a number of technology companies selling this very statement “Buy our platform and consider your Digital Transformation accomplished!”… at least till the next version is released that is. That’s a promising idea. Like getting some meds to fix a disease. Truth is far more complicated. Technology is simply a vehicle / enabler of a larger change. That change is cultural and personal before it can ever become organizational.

Common symptoms if you’re doing this:

• Your Digital Transformation is heavy on the technology and very light in culture change and training. Depending on your industry, the cost of technology should be 30% to 50%. It be less but no more than 50%.
• Whatever technology you rolled out to achieve organizational changes is simply NOT getting user adoption. That’s likely because you didn’t invest time to understand current business processes or provided a compelling reason for people to change or you don’t have a proper training program.
• Your platform / tech vendor keeps coming back to sell you more components / services because what you’ve purchased and implemented to date is not bringing results. There is probably nothing wrong with the tech. But the tech has to be implemented on top of a larger foundation of cultural, personal, and business changes you’re neglecting.

Myth 2: Digital Transformation is a “limited-time engagement” or “limited-time investment” (e.g. it’s a fad or all you need is a 2-year plan to achieve specific changes)

That’s completely ridiculous. This transformation is primarily driven by customer and market changes. That’s like thinking that two years from now customers will stop changing and your competitors will stop evolving. Your investment in Digital Transformation is not only permanent, it will likely need to increase in future years. Why? Because the new generation of customers adopt and change much faster. This Digital Transformation is not simply about evolving your organization. More importantly, it’s about developing a long-term ability for your organization to continue evolving faster then your competition.

Common symptoms if you’re doing this:

• Your digital transformation budget decreases and ends in the next 2 to 3 years
• You expect to wind down your digital transformation and / or training team
• You are not investing in ongoing efforts to evolve your organizational culture (e.g. it becoming a basic organizational competence / managed by HR / part of annual review process)

Myth 3: You don’t need help to achieve Digital Transformation. You can figure it out, plan it, and execute it by yourself.

Often this is not a belief or choice of ignorance. This is a belief or choice that results from budget and resource capacity limitations. Executives feel there is no other choice given their limitations. I know these situations are very difficult. Traditional approach to managing companies is to hire a person with skill set to lead the efforts internally. That approach is perceived cheaper (comparing to outsourcing) and provides a high level of accountability. However, it really limits your vision. Few internal people will never have as much insight or perspective as an army of specialists you can leverage for limited strategic engagements. Yes consulting firms are more expensive then internal salaries. But mistakes of internal resources (due to their limited vision) is more costly then consulting firms. Please understand that if you had the vision of what’s needed, you would have already been in the middle of the transformation and it would not even be called a “transformation”. It would already be “business as usual”. The reason why this is a “transformation” is because you don’t have the foresight, the perspective, and a clear picture of how to get there. Accept that fact that you need someone with more / different perspective to come alongside and help you.

Common symptoms if you’re doing this:

• You keep missing the mark in your current Digital Transformation efforts. Your assumptions prove to be wrong. You keep choosing the wrong solutions. Your plan keeps changing.
• You are having difficulty justifying Digital Transformation budget increases to your senior leadership, especially as related to getting external vendors / partners to help.
• Your internal staff responsible for Digital Transformation are struggling and overwhelmed… even if they have the credentials and experience that should have delivered results by now.

What Digital Transformation really is

OK enough of pointing at problems. Let’s get constructive. What is the right way of looking at this topic?

In my experience and humble opinion, Digital Transformation is [what] hyper-evolution of [who] customers, staff, and your organization in [context] the current digital / information age for [why] the purpose of increasing value (to customers, staff, and your organization).

• What: Hyper-evolution… the process is one of rapid evolution / change management and it pervasively impact culture, people, process, and systems
• Who: Customers, staff, and your organization… all three. You can’t change one without changing all three.
• Why: Purpose of increasing value… there is a specific measurable outcome and related KPIs that are used for decision making
• Context: Digital / information age… it’s this context that makes this exercise “digital”. But digital is NOT the what or the why. It simply drives the “how”.

The balance between customer, staff, and organization may be different depending on nature of your business, your product, and your market. However, the nature of what has to evolve in your Digital Transformation has to account for all of these.

 

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