The Basics of Digital Transformation
We live in a time of tremendous change and upheaval of technology, a trend that isn’t changing any time soon, if ever. Also known as digital transformations, these rapid and radical changes are a continual, routine, practice for businesses wishing to attain and retain a competitive advantage. The reason for this ongoing fluidity and rewiring is quite easy to understand – digital transformations are market-driven responses to technology’s continuous evolution.
Digital transformations can be viewed as lifelong endeavours, for most business leaders will be on this journey throughout the duration of their working lives. These long-term efforts are intricately tied to AI, for the latter helps businesses formulate insights and decision-making logic, the end goal being to expand the bottom line. Digital transformations, then, should include AI transformations.
Digital Transformation Goals Are Often Not Met
Many SMBs struggle to launch and maintain digital transformations. Shockingly, approximately 70% of such efforts fail. IDC’s 2023 FutureScape: Worldwide CIO Agenda 2023 Predictions states, “We have now entered the era of the digital business, where transformation must be part of enterprise DNA.” In other words, to remain competitive in today’s ever-changing business world, SMBs must be successful in their digital transformations – there is no room for failure.
4 Ways Digital Transformation Efforts Are Derailed
Though there are many reasons why and how digital transformations fail, there are 4 reasons that, if rectified, could well lead a company to successfully launch and maintain these necessary transformations:
- Lack of a shared vision. We have all been guilty of focusing on too many initiatives without a shared vision. Priorities need to be limited to just one or two, and a clear purpose should be outlined including who the customer is, targeted value propositions, and achievable targets as a first step in any digital transformation effort.
- Failing to set collaboration and communication principles teamed with an inadequate data strategy is a recipe for failure. All the best methodologies employed to facilitate digital transformation are ineffective without well-defined requirements teamed with effective collaboration and communication efforts. Driving key performance indicators and data-driven decisions without employees understanding the company’s digital transformation objectives and how their roles contribute to them is a recipe for disaster. In effect, data strategy requires involving the entire team, not just stakeholders and business leaders.
- Lack of product-centricity. Not making a company product-centric is a common error company leaders make. “Companies that leverage high-quality data, centre their enterprise around responsible risk-taking, and organise around products are the most likely to experience profitable growth from their digital transformation journey,” says Anant Adya, EVP of Infosys Cobalt.
- Not having the right mix of IT, business leaders, and stakeholders involved in the planning stages, implementation, and maintenance of the digital transformation often leads to business decision-makers having to revise their company talent base in order to see success in such a transformation. Bottom line? SMBs need to carefully evaluate the team it assembles and hire accordingly before launching a digital transformation.
Fixing Digital Transformation Mistakes
Besides becoming familiar with the 4 main reasons companies fail at their digital transformation efforts, business leaders should focus on key efforts before launching digital transformations.
- Map. You wouldn’t go on a long road trip without a GPS system or, for those who are more enamored of old-school travel, a trusty map. So it is with digital transformations. Plan carefully designed digital transformation goals and make sure they align with overall business objectives. Start dates, employee roles, and what processes are projected to occur are vital components of such a map.
- Monitor. Once the digital transformation is on its feet, it takes continual monitoring of metrics and data analytics to make sure that company goals are being met and to catch any potential problems.
- Skilled leadership and employees. A highly skilled team is an essential component of any successful digital transformation. If a company does not have employees and leadership who have the required knowledge and expertise to successfully launch and manage digital transformations, they should be brought on board before beginning such an endeavour.
- The Human Factor. Tech can only take a company so far – involving the whole team from the beginning and communicating with them frequently and transparently is an essential part of the digital transformation strategy. SMBs should raise awareness about why digital transformations are necessary and that the opinions and ideas of the other team members matter.
If the pitfalls are avoided, and positive processes are put into place, digital transformations within a company can be successfully introduced and maintained, allowing it to adapt to rapidly changing technology and remain competitive in an ever-changing business world.
At Nextro, we understand the challenges of digital transformation, and we are ready to design the perfect strategies for your company achieve success.
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