• The Value Gap in Digital Transformation, and How to Avoid It

The Value Gap in Digital Transformation, and How to Avoid It

When talking about digital transformation, it’s natural that those of us working in the field focus on the positives of our work - helping businesses grow, develop new revenues and stay competitive.

However, it would be negligent to gloss over the very real barriers to transformation that organisations face, and to fail to recognise that even when businesses understand the need to embed digital, the implementation of such a project can be problematic.

New research by management consultancy A.T Kearney examines this very idea, revealing that 59% of European C-Suite executive respondents report that digital innovation has not delivered high business impact at their organisation, despite confirming that digital transformation is key to greater customer acquisition and increased revenue.

Two primary barriers are identified, with 59% of participants citing the integration of new technologies into established infrastructures, and 51% naming a corporate culture that is not ready to embrace digital technologies.

Although it’s disappointing to learn that digital transformation is not delivering impact for the respondent businesses, the two named barriers are of little surprise to me.

In our work at Discerning Digital, technological integration and cultural change are two of the most difficult areas to influence, and yet they are absolutely crucial to transformation at any scale.

The Integration Challenge

I’m fond of saying that when it comes to digital innovation, technology isn’t everything, and indeed it isn’t, but it would be naive to discount its fundamental role.

Typically, our transformation projects begin with a strategic element but very often a need for new systems, tools or processes is quickly identified.

Many of these strategies share common elements; to grow the business, develop new products, identify new revenues or simply become leaner and faster - technology is a key enabler of all these goals.

However, even when clients agree on the need for tech investment, existing infrastructure and processes can throw up complex obstacles that can stall a transformation project, or worse, stop it in its tracks.

If this is a concern of yours, I’d advise you to:

  • Conduct a thorough review of your existing tech infrastructure and get a complete picture of your current standpoint. This is a fundamental step.

  • With this information, take an honest reading of the skills you have in-house. Embarking on complicated integration is doomed to fail without the right skillset to undertake the work.

  • Engage the services of an integration specialist. The cost will be more than offset by the security and safety of such support, and could mean the difference between a successful transformation and an expensive disappointment. An experienced integration specialist can not only supplement your resources but help keep the project moving.

Cultural Change in Transformation

The role of culture cannot be understated in any digital project, and I’ve seen first-hand how difficult change is without company-wide support.

There are lots of theories on the best way to facilitate change in an organisation but I firmly believe that transformation can only work when visibly supported from the top down.

Some of my key learnings on cultural change in transformation include:

  • Appointing a board champion for digital, to place it firmly on the agenda at the highest levels. This person can bring digital to all top level conversations with authority to make decisions and pull the project together when required, and provide important and visible leadership.

  • Disperse ownership for digital across all areas of the business, and devolve its pressures and responsibilities. Having a talented digital team is great, but everyone in the business must feel invested in digital for longer-term success.

  • Joint milestones or goals across departments can be a useful way to communicate the vision and bring everyone on the same journey.

The most important thing to remember is that these measures should enforce how digital supports your existing KPIs and strengthens your vision, rather than being viewed as a separate set of goals. This truly is a fundamental tenet of transformation.

The Value Gap Can Be Bridged

Talking honestly and openly about the challenges of digital transformation should be encouraged. Transformation isn’t meant to be easy and the greatest risk of all is investing in a project without any real understanding of the potential stumbling blocks.

The insights from this research should act as a pertinent reminder of the common pitfalls in digital innovation, which while they may be challenging, are by no means insurmountable.

As ever, I welcome your feedback, so tweet me @DigiDiscern with your thoughts.

Best,

Richard

Discerning Digital is one of the UK’s first dedicated digital transformation consultancies, specialising in helping businesses unlock their online potential.