Digital transformation requires many decisions — some easy, some tough, but all of them important. Successful digital transformation requires a commitment to change the business, but you may find that your organization needs to transform more than its technology.
You must be intentional in building a digital culture, including changing legacy technology and structures that hinder transformation. From selling your vision and enabling innovation at all levels to measuring success, there are three important decisions to make when launching a digital transformation initiative.
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How Will You Sell Your Vision?
Every change effort requires excellent communication. As a leader, you have to actively communicate your vision, and explain why the change is necessary, in order for your digital transformation initiative to take hold. At this stage, four communication strategies can help:
- Brand your initiative. Enlist trusted colleagues in your marketing department to develop key messages that are easy to remember, and then use those messages consistently when speaking about your initiative.
- Focus on the goals. Help the organization see how every action is a part of the larger strategy by framing conversations in terms of how the action being discussed impacts your overall goals. Whether you are discussing a technology change, a staffing change or a new product launch, tie it back to the larger picture.
- Be the change you want to see. Actions speak louder than words, and as a leader, you need to show your organization what you’re selling. If you’re driving a change initiative, be sure to use new technologies, mobile devices and social media to build your credibility.
- Champion your vision. Reinforce your goals through various channels. The media, corporate social media channels or speaking engagements are great opportunities to externally share your vision. Internally, you can share your vision at all-hands meetings, during web conferences and in one-on-one meetings to emphasize the importance of the initiative.
Who Will Lead Digital Transformation Efforts?
According to TechRepublic, research firm Altimeter’s “The 2016 State of Digital Transformation” report found that chief marketing officers lead digital transformation at 34 percent of companies, while CIOs and chief technology officers take charge of transformation in only 19 percent of companies. But while digital transformation must start at the top, it only succeeds when the entire organization embraces change.
Although the C-suite typically decides what the business strategy will be and directs the organization, the power of digital transformation lies in the hands of each individual user. To support change, leaders must reinforce digital skills, processes and technologies within their organizations — empowering front-line employees with the authority, data and technology to make better-informed decisions.
Yet distributed authority and bottom-up innovation only works if teams have the skills and information to make smart decisions. A myriad of data analytics and talent strategies can help here. From machine learning to advanced analytics, you have new opportunities to measure more, analyze data faster and make decisions more quickly. Here are a few strategies to consider:
- Fill job openings with “catalyst hires.” Recruiting people from startups, digitally forward organizations or companies in other industries can bring in employees who have new ideas and can help question ingrained bureaucracies and legacy technologies — as well as inject energy and excitement.
- Use analytics that include descriptive, diagnostic and predictive insights. That type of data can provide the evidence needed to drive strategic decision-making.
- Use real-time dashboards. Seeing visual representations of up-to-the-minute metrics enables departmental and organizational leaders to understand if something is working, instead of whether it has worked.
Digital activities and the data generated by those activities have made it possible to automate operations on a scale that was unimaginable just five years ago. According to McKinsey, 40 percent of sales activities could be automated using technology that already exists — and that figure could rise to 50 percent once machines are better able to understand and process language.
Therefore, it isn’t surprising that front-line employees may resist the change that comes with digital initiatives — especially automation. With this in mind, it’s important to emphasize that automation isn’t just about getting tasks done faster, it’s about providing front-line employees with the information necessary to make better-informed decisions.
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How Will You Measure Success?
Even in companies or departments that are focused on technology, digital culture deficiencies are commonplace. Technology gives us an opportunity to optimize, but sometimes organizations can end up focusing on optimization rather than innovation, stifling creativity and potentially slowing growth.
Myriad data analytics strategies can help here. The 2017 Data & Analytics Report by MIT Sloan Management Review found that companies’ use of data and analytical insights for strategic purposes — including innovating business functions and entire business models — is on the rise. The report also found that, in many cases, leveraging analytics gives companies a competitive edge.
Measuring challenges and successes with these strategies can fuel excitement about your initiative, encourage cross-departmental collaboration and connect employees to your strategic vision. By regularly sharing findings across the organization, innovation will become embedded in your company culture and provide long-lasting influence on organizational behavior.
Organizations must move beyond traditional structures, processes and systems to change individual and collective behavior, including culture, mindsets and capabilities, as well as team and group dynamics. This is imperative because digital transformation eliminates silos, enabling the business to react quickly to key signals about customer needs — regardless of where in the organization they’re originating.
The process of digital transformation gives you an opportunity to analyze, optimize and re-engineer the way things have always been done in your organization. To drive digital transformation, the most important question to ask is a simple one: Why?
- Why are we doing things this way?
- Why do we want to fix things?
- What problems will we solve?
- What do we want to accomplish?
- What will happen if we do nothing?
Leading digital transformation requires a compelling vision and commitment from the senior leadership team. Yet as McKinsey notes, vision and inspiration only go so far. For a successful initiative, leaders must embody and advance the key values of a digital culture: customer-centricity, a collaborative mindset, and a tolerance for risk.
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