We live in a world where phrases such as digital dragons¹ and digital icebergs are no longer imaginary concepts. They have become an
integral part of enterprise leaders’ active vocabulary, as they try to beat digital Darwinism and try to keep up with the latest technology tools.
A quick glance at any digital maturity assessment survey today
will reveal a typical bell curve with
10 percent enterprises being
innovators, 60 percent being
majority adaptors, and laggards
making up the remaining 30
percent. If Darwinism is to be
believed, this 30 percent will soon
enter into the confines of memory
boxes and museum shelves. Unless
of course they decide to act right
away, realizing that it is a long walk
from concept to practice when it
comes to digital transformation.
CXOs across the board, whether
adaptors or laggards, are waking
up to the fact that digital is more
than just a knee-jerk reaction or a
one-off initiative. Leaders must
understand that digital is not merely investing in a certain
product or solution that promises to
‘digitalize’ their operations. Digital
transformation is a continuous
journey that goes beyond
technology to fundamentally
change the way businesses operate,
respond to market forces and
engage with customers.
So, how can organizations
internalize the concept of digital
transformation? How can they place
themselves on top of the digital
maturity curve? How can
they survive?
Let’s look at five simple steps that
can answer these questions:
Always Lead with
Customer Experience
Before you roll out any digital
initiative, do keep in mind that
everything an organization does
must ultimately address an existing
customer need, challenge or
frustration. Focus on what your
customers prefer, and how you can
improve their experience. Your digital success will predominantly
be dependent on this single factor.
This can be as much an art as it is a
science and is will serve as the key
to maximizing your digital Return
on Investment (ROI).
Fail Fast, Learn Fast
and Succeed Faster
Although digital investments can
increase your profitability quickly,
as cited by more than 55 percent of
CEOs polled by Gartner,² you may
not be as successful as others in
the first few attempts. It is
imperative that you treat your
digital investments like you do any
other, like a series of experiments.
You can almost never completely
de-risk digital projects. Any failures
encountered can serve as learnings
for subsequent initiatives. Instead
of spending extended periods of
time perfecting a solution, use agile
methodologies to prototype
solutions quickly and then refine
them over time.
Cultivate a Digital
Culture
They say: “Culture eats strategy for
breakfast, lunch and dinner.” A
recent report³ by Altimeter lists
company culture as one of the top
challenges faced by organizations
embracing digital transformation.
Digital initiatives are usually owned
by specific departments, resulting
in competing priorities when
enforced on other teams that do not
have a ‘digital first’ mindset. In
order to overcome this, establish a
core team that liaises effectively
with all departments to roll out
digital programs. Your entire
workforce must be sensitized and
trained on all aspects of a digital
enterprise, including customer
centricity, agility, innovation and
aligned goals.
A workforce with a culture that is
open to change and innovation will
naturally increase your chances of
‘first time right’ in the context of
digital transformation. And, don’t
forget to recognize and reward
intrapreneurial employees willing
to take calculated risks and drive
forth change.
The Right
Metrics
What cannot be measured cannot
be managed or improved. This, of
course, applies to digital
investments and the associated ROI
as well. You must maintain an
enterprise-wide perspective on
digital investments, and constantly
monitor their impact on business.
Each digital experiment must be tracked using a specific,
pre-determined set of metrics,
including both quantitative and
qualitative parameters. Do deploy
an analytics engine to model the
change in probability caused by
digital action. This will play a crucial
role in improving the probability of
your digital programs’ success even
before you invest in them.
Build a Partnership
Model that Works
for You
As you focus on overhauling your
business model to become more
digitally driven, partnering with the
right technology and solution
providers will become critical.
However, you would also want your
existing operations and technology landscape to be able to support any
such partnerships. To optimize this
experience, look for platforms that
naturally support integrations with
most of your business systems or
those that extend or create
customized integrations. Also,
determine whether to build or buy
and select suitable partner models
for implementations using metrics
like the total cost of ownership and
cost of change.
A Final Word
A frequent mistake that most
companies make is to get confused
between a technology project and a
digital investment. Although most
digital transformations are driven
by IT, leaders need to realize that a
wider, enterprise-level buy-in is
crucial for success. Companies
must focus on transforming the
way they do business with
customers, and use technology only
as an enabler to accomplish that.
References:
1. http://www.gartner.com/smarterwithgartner/how-to-become-a-digital-dragon/
2. http://www.gartner.com/smarterwithgartner/2017-ceo-survey-infographic/
3. https://www.prophet.com/thinking/2016/02/the-top-digital-transformation-priorities-for-2016-part-1/