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Poor leadership can tank digital transformation efforts

Quick wins and dedicated transformation leaders are two ways to ensure success, HBR finds.

Photo by Getty Images on Unsplash
Photo by Getty Images on Unsplash

Companies worldwide are projected to spend almost $4 trillion on digital transformation by 2027. The benefits — increased efficiency, better customer experiences, and data security — are clear. But you won’t reap those benefits without solid leadership. 

The Harvard Business Review (HBR) reports that only 12% of digital transformation plans yield lasting results due to inefficient leadership. You see a lot of initial fanfare and enthusiasm, only for a company’s transformative goals to continue to be far on the horizon even years after an estimated deadline. 

This is partly due to the fact that companies have settled for more mediocre results over time. In two surveys of 300 large companies in 2013 and 2023, Bain & Company found that the percentage of respondents meeting their transformation goals hasn’t changed since 2013 — stagnating at 12%. Those achieving moderate success in their transformation goals increased from 50% in 2013 to 75% in 2023. HBR suggests this is another result of an attitude of cynicism of whether transformation is worth the effort. 

So, how can companies improve leadership in digital transformation efforts to retain lasting change? We rounded up some tips from HBR, Deloitte, and Zendesk: 

  1. Make CEOs more active in digital transformation. Employees need to see enthusiasm for new tech and initiatives, especially as a project becomes more complex in its lifetime. 
  2. Limit change to two primary roles at one time for quick wins and gradual adoption. HBR reported that digital change garnered less productivity if it impacted too many employee roles at once, as it caused “organizational fatigue.”
  3. Continue leading technological innovation even if your team is tech-savvy. Complacency can hinder even the most tech-savvy workforces, which is why Deloitte says leadership should continue to emphasize innovative tech along the way. 
  4. Set grander expectations and focus on aspirations over targets. Even if your target seems the most “reasonable,” think about what will be fruitful in your transformation to lead your company rather than already-tried goals that yield the same results. 
  5. Identify a digital transformation leader and/or manager. This could be an individual or small group of senior managers or executives to be responsible for meeting milestones. Zendesk says they should have intimate knowledge about the company, know how to interpret data, and have enough tech expertise to balance out assessments for potential new platforms and initiatives. 
  6. Set aside enough funding. HBR found that most failed digital transformation initiatives were underfunded. While some finance teams might recommend using internal funds and cutting costs wherever possible, the most successful transformation initiatives were funded with external capital. 

Learn more about digital transformation leadership from HBR’s study here

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Written By

Veronica Ott is a freelance writer and digital marketer with a specialization in finance and business. As a CPA with experience in the industry, she's able to provide unique insight into various monetary, financial and economic topics. When Veronica isn't writing, you can find her watching the latest films!

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