Companies embarking on the digital transformation journey face man challenges, such as deciding from the array of technologies — from big data analytics and machine-learning to augmented reality and biometrics — which will be a success. Digital transformation is not just about technology; to succeed some key management fundamentals need to be got right. Four of these are assessed here.
Forming a vision
There are some common themes central to successful digital strategies. The first is with establishing a straightforward view of the industry’s direction over the next five years (or longer). Often the end result can be predicted; what is more variable is the pace of change.
According to San-Francisco based Altimeter, many companies are struggling with the technological and human challenges of digital transformation. This is because many firms tend to embrace the digital project in fits and starts, often making reactive and siloed attempts at change. This happens because these firms lack a clearly defined vision of where they want to go.
Having an honest view of the current state
A second factor is with performing an open (and honest) assessment of the company’s current state. This is necessary in order to formulate a clear vision of where the company is trying to go towards.
According to website CIOWaterCooler, vision is fundamental to strategy. Companies need to to make it completely clear how digital transformation will support overall business strategy. This involves critically looking at the now. To achieve an accurate appraisal improved data collection and analytics are often required.
Data can be used to help develop new technologies, such as those centered on automating tasks and processes end-to-end, such as through single platforms that lower costs and simplifying systems.
Changing the culture
A third factor involves capturing the energy of the entire team and organization. Cultural change is central to any digital transformation success. A McKinsey survey of global executives highlighted three digital-culture deficiencies. These were: functional and departmental silos, a fear of taking risks, and difficulty forming and acting on a single view of the customer.
Importantly, while culture change is critically important to transformation, it is difficult and time consuming to achieve.
Bringing in new technologies based on customer need
The fourth and final point is with implementing new offerings (‘the what’). According to a Bain Brief, this is especially with products and services that customers actually want. In addition, and new capabilities needed to be resourced and costed ‘(the who and the how’).
The types of technologies and how they are achieved will vary across sectors. For a peak into what the utilities sector is grappling with, see the Digital Journal article “How utility companies should approach digital transformation.”
