International Data Corporation (IDC) predicts that by the end of 2019, digital transformation spending will reach $1.7 trillion globally. Yet a recent survey by Couchbase uncovered that 95% of CIOs and technology leaders believe that digital transformation initiatives will fail.
Digital initiatives are vital to success in today’s business environment. So if these initiatives are necessary, and they’re funded, what’s behind their failure?
Change management (or the lack thereof) is the culprit. Most leaders understand the importance of change management in digital transformation strategies; however, many fail to realize that traditional change management isn’t the best fit for today’s agile and flexible digital initiatives. If you want your digital initiatives to gain traction, you must adapt traditional change management methodologies to drive the digital transformation process.
Stages of Traditional Change Management
Traditional change management is linear — a step-by-step approach with a beginning, middle and end. It can work well for certain types of organizational change, particularly those affecting a single department or process. Typically, the steps in a traditional change management process will cover:
- Sponsorship: Ensuring there is active sponsorship for the change at a senior executive level within the organization.
- Buy-in: Gaining buy-in for the changes from those involved and affected, directly or indirectly.
- Involvement: Involving the appropriate people in the design and implementation of changes to ensure the right modifications are made.
- Impact: Assessing and addressing how the changes will affect people.
- Communication: Telling all stakeholders about the changes and how it affects them.
- Readiness: Getting people ready to adapt to the changes by ensuring they have the right information, training and help.
Why does this matter? Researchers at McKinsey found that most change management efforts fail because outdated models and change techniques are fundamentally misaligned with today’s dynamic business environment.
Related Article: Change Management: The Key to Successful Digital Transformations
Stages of Digital Change Management
For successful digital transformation, you must make large changes across highly interdependent processes that affect multiple departments, including sales, marketing, IT and more.
While traditional models of change management may not fit the agile nature of digital transformation, change management is essential to successful digital transformation. You must lay the right foundation for driving change from the start.
- Develop a digital transformation strategy and ensure your executive team is aligned around your goals, and how you will achieve them. Don’t forget to ensure that your digital transformation strategy is aligned with a greater organizational purpose.
- Identify executive stakeholders and change leaders. Digital transformation is driven by change agents who understand how technology can support your organization’s purpose. They may be anywhere in the organization or even outside your organization. Don’t overlook vendors or analysts with specific expertise.
- Build cross-departmental collaboration. Successful digital transformation can’t take place in a silo. Ensure you’re driving a holistic approach that involves experts from across the organization.
- Engage the entire organization. Any kind of change requires employees to learn new skills and change long-held habits, which can lead to pushback. Change will be better received if team members feel they have input and if communication is clear and regular.
- Invest in training. Digital transformation requires your whole team learns new skills, whether it’s data-based decision-making, new software platforms or new collaboration tools. Invest in online courses, certification programs and training to ensure that team members feel valued and your organization has the skills necessary to support ongoing transformation.
Digital transformation is a huge undertaking for change managers, team members and executives. Without a well-thought out plan that ensures everyone in the organization is onboard, it is likely to fail.
Related Article: 8 Tips for Improving Change Management in an Evolving Workplace
3 Ways to Drive Successful Digital Transformation
Like change management, digital transformation is tough, but it’s essential. There are a few ways you can adapt to the challenges and changes that digital transformation brings:
- Be willing to change and innovate. Research shows that since 2000, 52% of companies in the Fortune 500 have either gone bankrupt, been acquired, or ceased to exist because of digital disruption. Obviously the solution to digital transformation is not to remain the same and hope for the best. Be open to new technologies and ways of working.
- Work together. If you’re in IT, ensure you’re partnering closely with the business. If you’re a business leader driving digital transformation, work closely with IT to gain their support and ensure success.
- Remember change is emotional. Digital transformation involves people, and as much as we wish logic rules, people are driven by emotions. Don’t just dictate new ways of working — inspire team members with a vision and purpose for change.
While digital transformation is one aspect of change management, it is not the end of transformation. Your organization still needs to improve on an ongoing basis, so don’t forget to continue to change and adapt to remain successful over the long-term.