Virtually every industry today is reimaging its business for the digital age. Despite this ubiquitous digital transformation, most companies aren’t very good at it. Studies show that over 85% of digital transformation initiatives fail. Why? When large-scale transformations fall short of expectations, it is often because business leaders fail to realize critical factors and steps necessary when developing their digital transformation strategy. In this article, we explore five critical success factors gleaned from several successful case studies I have witnessed first-hand throughout my time as an account principal at Contino.
Start with a compelling business case
When starting a business, a business plan can be critical to obtaining funding. Similarly, when embarking on an internal initiative for your company, a business case is crucial for obtaining buy-in, support (especially C-level) and, of course, the all-important financing. A good business case should translate the digital transformation effort into dollars and cents. How will it save or make money? How can it impact revenue? Knowing your “why” should go beyond platitudes and illustrate what transformation will do for the company’s bottom line.
Establish a vision that translates across the organization
In today’s accelerated markets, lengthy roadmaps and plan-based approaches have been superseded by a “vision” for the product line or business in question. A vision for transformation must be continuously evaluated for business value and adherence to strategic goals. Where does the business want to be in the next six, twelve or eighteen months? What new capabilities are needed? What are market challenges that need to be met?
Next, socialize the vision and obtain buy-in from stakeholders across the organization. Knowing your “why” goes a long way in reducing organizational resistance to change. Once people understand what you’re trying to achieve, you’ll be in a better position to enlist their support, and eliminate confusion and organizational resistance. People often resist change because they don’t understand why they are doing it, or what they are getting out of it. This works much better if you have a compelling business case and can illustrate how the stakeholders benefit as well as the business.
After all, if the business wins, everybody wins. Once the vision is established, it is time to align technology with the business.
Technology as a means to an end, not the end goal itself
One of the most common pitfalls with digital transformation is creating a technology solution and looking for a problem to solve, instead of focusing on the problem first, and then determining what technology is best suited to solve it. This often comes in the form of adopting technology merely for the sake of “being current” or “in vogue”. The end goal should not be the adoption of a specific technology, rather, it should be focused on positive business outcomes. Hence, knowing your “why” is critical. Ensure that all stakeholders approach the transformation initiative with a business first, customer-centric mentality. Quash religious technology battles and focus on the outcomes.
Conduct an honest capability assessment
Before beginning any business venture, it is essential to understand what it will take to pull it off, and what capabilities your organization may need to build. Organizational maturity, staffing and technology are all important factors. However, fundamental changes in culture, people and process are often required and should be considered equally important. All of these factors can impact the assessment of one key attribute: agility.
Agility is the speed and efficiency at which an organization can meet market demand. Performing an honest agility assessment can be a complicated and daunting project of its own. An outside advisor is best positioned to provide an objective and actionable assessment that will enable your transformation initiative.
Enlist a top advisor
Have you ever tried to lose weight, change careers or win a competitive event? If so, you know just how difficult it can be. Any kind of transformation, whether digital, business or personal in nature is very hard. Most people need a coach to be successful. The same can be said for organizations. Even if you feel that your organization knows what to do, executing is another matter. Even the most accomplished and knowledgeable professionals periodically enlist the services of an advisor.
So what are the traits of a top advisor?
A top advisor is a recognized expert in their field. They may be a leader in one or more professional organizations, and/or teach and speak regularly at conferences, institutions or professional events. Most have a social media platform with a sizable following.
Peer reviewed and published in their field. A true expert should not be afraid to put their thoughts in writing and should be fully capable of doing so. Such writings should also be peer reviewed and published in reputable journals.
Credentialed and accomplished. What have they done for their clients? What have they actually accomplished in their career? Have they gone beyond mere “personal referrals” and obtained credentials such as certifications, advanced degrees, etc. to keep current? Education isn’t everything, but it is one of the few objective indicators we have. Humans are fickle and virtually every business, working professional or pundit has disciples and detractors.
Experienced in your field of context. Be sure the advisor or organization has experience in your industry or technology vertical. Have they solved the same problem for other clients and what were the results? Can they produce compelling case studies?
Evidence of a continual pursuit of excellence. Again, continuous improvement is a cardinal virtue and should be exemplified through education, experience and technical community leadership.
A top advisor can help you complete these five critical success factors, and once you do, you’ll be well on your way to transforming your business. If you’re ready to start a digital transformation journey and need a group of experienced advisors, working with a reputable consultancy can position your business in the right direction. Contino is a leading transformation consultancy that helps large, heavily-regulated enterprises become fast, agile and competitive.