As digital strategy consultants more often than not, we see a lack of a shared vision or focus within organizations (between IT / LOBs) when it comes to Digital Transformation. What we commonly hear from organizations is:
- “We don’t have the resources available and/or talent to focus on digital initiatives” because IT is heads-down focusing on steady-state operations of computing services and resources, as well as large initiatives (e.g. ERP implementation or migrating their infrastructure to the cloud.)
- “Business is tired of waiting on IT” or “IT is slow to respond to our requests.” This leads to the business going out and identifying their own digital solutions and contracting 3rd parties to develop or implement these solutions without consulting IT.
- “We’ve been doing it this way for years and everything has been working just fine, so why change.” The perception that introducing new technologies will impact the organization’s culture creates a resistance to change.
- Another common challenge we hear is that organizations know why they need to adopt new technologies for transforming their business, but don’t know how to go about doing it.
In these cases, there’s generally support from the leadership team to explore and move forward with identifying and implementing new technologies (e.g. mobile, AI/ML, IoT, etc.), but they don’t know where or how to start. So, leadership will task an individual or a small team with researching solutions, meeting with vendors and even conducting some proof-of-concepts or building prototypes. The challenge here is that there is no clear understanding of “why they are looking at these technologies” or “what problem they’re trying to solve.” What ends up happening is that companies will choose and implement a solution without aligning it to a specific use case or business objective (e.g. improve customer experiences, increase employee productivity). Or, they’ll identify the right technology solution from a functional perspective without consulting IT regarding how it will be integrated or if it complies with security standards, ongoing support, etc.
We also see what I refer to as a “Siloed Approach,” meaning organizations will create a whole department or create an Innovation Team. This is a decent approach so long as the department or team is aligned with, and understands, the organization’s business goals and objectives, and the IT organization’s readiness to support technology innovation. It’s great to explore new technologies and create cool innovative solutions, but if they cannot be supported by the organization (IT/Business) and don’t deliver any value (e.g. improve operational efficiencies, enhance customer experiences, increase competitive advantages, increase employee productivity) then these organizations are spending investments in time, people and money for the sake of research and development.
Based on the challenges stated above, the following are our recommendations for achieving digital transformation success:
- Develop a Digital Strategy. Digital transformation is all about adopting a high-level strategy with tactical and pragmatic tasks for execution to create a feedback loop which may evolve over time. Without a high-level strategy, a tactical plan is impossible. And without a tactical plan, your organization will wind up pursuing an incoherent, uncoordinated attempt at digital transformation. Organizations need to have a strategy as well as a Center of Excellence in place to champion their digital transformation.
- Understand thematurity and readiness of your organization’s ability to deliver and support your digital transformation.
- Assess the commitment level of your CEO and board members to the digital business transformation strategy. Define the key business drivers that guide and drive the digital strategy. The digital transformation process should be specific to the business and its priorities. For instance, since healthcare companies are driven by patient satisfaction, they will expect as an outcome of their digital transformation, ways to better assess patient satisfaction and improve their experience. Meanwhile, a manufacturing company might focus on improving assembly-line efficiency, so would looking at implementing IoT and Machine Learning to streamline the manufacturing process and improve product quality.
- Discuss your company’s digital maturity with key stakeholders from the business and IT to ensure proper focus and alignment of business and technology strategies.
- Define what “current-state” is and identify where “gaps” exist that impact the success of digital transformation initiatives e.g. data quality and readiness for AI/ML solutions, well-defined delivery standards, processes and tools that enable continuity and reusability in the development and delivery of digital solutions.
- Based on the gaps identified, define the solutions (people, process, technology) required to fill these gaps and ensure the readiness of the business and IT to support current and future digital transformation initiatives.
- Develop a Digital Transformation Readiness Roadmap that prioritizes the identified initiatives (required: 90 days, short-term: 6 months, mid-term: 12 months, long-term: 12 months+) and indicates the time required to improve the maturity level along with the organization’s readiness for supporting the digital transformation strategy. Focus on “Quick Wins” that require minimal investment, show progress and generate immediate value to the organization.
- Focus on core competencies that drive revenue. For example, we work with a client with a customer-facing app responsible for their entire revenue. As you might expect, their digital transformation is laser focused on updating that service. Other internal applications in their portfolio could also use a digital facelift, but since those drive less business value, they’ve been set aside for later. Selecting a service or application that drives business value ensures that IT, Development, and Business Unit Owners are all in alignment.
- Form a “Digital Enablement Team” that serves the needs and business objectives of the organization by providing thought leadership, communication, standards and governance for digital transformation and implementation of digital solutions. This team is responsible for driving collaboration and partnerships across business and IT to ensure the smooth delivery of digital solutions and serve as the touchpoint for all digital transformation initiatives across the organization.
- To overcome the common challenge of “no budget” and “IT cannot respond quick enough,” we recommend working with the business to define and prioritize use cases that can be used to prototype solutions. Prototypesare a great way to test potential digital solutions before you make a significant investment that may not provide the desired results. Prototypes can be completed in a matter of days to weeks, providing fast-feedback while requiring a minimal resource commitment.
- The final key component is the enablement of quantifiable metrics and goals to define what success looks like. Even more importantly, you need to understand what failure would look like and be able to detect potential trouble spots before they develop into major issues. Defined metrics and goals help your team continuously refine and evolve its approach over the course of a long-term digital transformation.
Don’t let the all-too-common problems of a missing shared vision or lack of focus block your path toward digital transformation. Follow the proven steps above and achieve this critical, company-wide goal.
