Forward-thinking organisations are realising that they require greater operationally agility to successfully meet ever-rising customer expectations. With customers also demanding easier businesses engagement – and across a wider spectrum of channels, this is forcing businesses themselves to enact internal change more quickly. These factors are putting increasing pressure on IT and business leaders to respond by undertaking ‘digital transformation projects.’
The need for this ‘transformation’ is proving especially relevant to larger companies – where in many sectors, they are being disrupted by more dynamic, nimble, startups and SMEs, that have less legacy IT baggage – such as processes and people - to move around. Ultimately, the key focus for all digital transformation projects must be on the end goal of achieving greater business agility – with the ability to swiftly respond to the needs of the market, and provide a greater ease of engagement, so they become more customer-centric - and ultimately more successful.
Why digital transformation is failing?
What hasn’t helped successful adoption is there have been years of confusion and hype about what digital transformation actually is. Only now is it finally being defined as a series of projects that address the process of using technology to radically change a business so it can respond faster to change and opportunities.
Even after gaining better digital transformation clarity, it’s still not an easy undertaking where organisations are tied to legacy, on-premises systems. These systems are costly and time-consuming to maintain, are often poorly interlinked and typically reliant upon a few individuals within the organisation who understand the work-arounds and bespoke customisations. These complexities naturally present a major hurdle to any IT upgrade project.
Many organisations have a misguided resistance to transformation projects too. Typical objections include cost - where a lot of capital investment has already been put into existing systems, of which the business is still trying to make a return on. Some organisations think they are 'special' and that no mainstream transformation solution will be able to meet their bespoke requirements. Also, sometimes there can be an unfounded security fear factor of solutions that involve hosting data outside of the organisation.
Sometimes doing too much, too soon with a ‘big bang’ change approach can be overwhelming. With the introduction of new technology, many organisations may be worried about job protection – and with staff fearful of losing their jobs, naturally they may put up blockers.
There can also be a lack of user buy-in – as digital transformation presents a cultural shift in the organisation. Many people do not like change, and need to be motivated by understanding the end goal and how the changes will benefit their role. These problems usually occur when members of the board are not initially involved in a project – as successful digital transformation should always be driven from the top down.
Ultimately, all these issues appear when there’s a lack of understanding in the technology available and / or when the wrong solution is chosen. This leads to expensive customisation to bridge functionality gaps – which increases the total cost of ownership and lowers the corporate appetite for further transformation activities.
When digital transformation works
The most successful and agile companies today are ones that constantly seek to improve their processes – and specifically the ones that improve their customer journeys. They also carefully consider what new technologies fit their customer base the best, and how they can use them to work smarter. This presents a huge change, especially for companies that have set in stone, legacy policies.
Organisations must therefore look forward, break down silos and focus on both user feedback and collaboration – so they can start to continually improve - more quickly, through development and design. However continuous improvement doesn’t just mean making processes faster. With customers’ ever-changing expectations, means that every interaction— on any channel – must be a positive and meaningful one – so they remain happy. Organisations must therefore be proactive and anticipate customers’ needs - while thinking of new and better ways to meet them.
Steps to success
When embarking on a digital transformation journey, the following practical tips should help ensure successful outcomes.
1. Get the right stakeholders on board
Organisations must first ensure that the project is driven from board level, and a team is carefully chosen. This may involve bringing a new person in to manage the project that has previous experience of transformation projects and understands the pitfalls to avoid. The next step is to develop a change management programme, beginning with a change vision statement to rally support from key stakeholders within the organisation. Also a communication strategy should be created to keep everyone on board throughout the project.
2. Start a customer first methodology
The next step is to look at the optimal customer journey and then understand the technology and business processes required to support this. This approach will then define the functional requirements for a new system - which can be used to evaluate the best-fit business applications.
3. Tweak existing technologies first
Organisations should avoid building business applications around their requirements. They should review the technology that is available and understand its capabilities. Only then should tweaks to business processes be considered – so they can make best use of the technology - whilst fulfilling the ultimate business objectives.
4. Seek expert help
As most organisations have the usual IT resource and expertise constraints, very few will be able to achieve a digital transformation project in-house. By involving an expert partner, will not only mitigate the risk of project failure, but reduce the initial project outlay too. This move will also offer a host of additional benefits such as getting the latest version of the software and being able to pay for the licenses on a monthly basis.
5. Consider the cloud
Consider cloud-first, this will open up a whole host of new opportunities in terms of functionality, flexibility and reduced infrastructure costs. Cloud is a key focus of all software vendors’ investments now – which means that the technology will be future proofed too. Furthermore, the market leading providers of cloud solutions boast optimal levels of privacy, security and compliance – which would be very difficult for organisations to match internally. Using the cloud also liberates internal IT teams to focus on value-add activities - instead of being the go-to department when things break.
Eddie Harford, Founder and Managing Director of SeeLogic
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