Digital transformations (DX) can be as simple as the creation of an internal digital and advanced-analytics (DnA) system or as complex as an enterprise-wide technological shift. While these shifts have changed the way organizations operate, they’ve also had a big effect on how they plan to do so in the future. At the end of the day, the success of DX efforts largely comes down to people.
With this reality in mind, researchers at McKinsey Digital recently undertook a review of 30 large-scale digital transformations to better understand the dynamics at play behind the process, and ultimately what talent and tech decisions have the biggest impact on DX success.
Through this research, several key insights emerged.
Fill senior roles with the right digital leaders
One of the most glaring points McKinsey made in its review was the need for organizations to prioritize their hiring of digital-minded leaders. The high performance of a transformation project often rests on the shoulders of these individuals, even more so than on the technologies they use.
In fact, the research found that up to 50% of a given group or unit’s performance variability could be attributed to the individual leaders driving the transformation. Therefore, it’s important for organizations to invest in hiring and nurturing these data scientists, digital strategists, engineers, and other digital-focused leaders for their digital transformations to be successful.
But in that same vein, McKinsey notes that companies should be wary of rushing into hiring in these roles. It explains that organizations risk the overall reputation and viability of their programs if they attempt to take shortcuts with early hiring, sometimes delaying progress by a year or more.
Invest in digital learning and development programs
Another key area of impact researchers highlighted was learning and development, and how investments in such programs for DnA rollouts could improve the success of digital transformations. The McKinsey team noted that both on-the-job training and structured learning programs can often do more to improve the success of a transformation than just hiring in new talent.
Furthermore, the review indicated that companies who reward higher skill levels with better compensation were much more likely to be successful in their digital transformations than those who did not. It cited data gathered from leading organizations who comparatively rewarded higher skill levels with better compensation (67%), greater benefits (64%) and more responsibility (78%) than laggard companies who only managed 41%, 23% and 58% respectively.
Similarly, McKinsey emphasized one important fact: digital talent can often be tapped within the organization. Since not all digital products are going to require expert-level skills, upskilling non-digital talent, they found, could potentially cover up to 70% of an organization’s digital needs. Just make sure that you’re being realistic about who can be upskilled and the time commitment.
And while upskilling is important, organizations need to balance immediate results with long-term capability. Contractors can help fill gaps in the early days of a digital transformation, but need to come with a strong transition plan.
Take another look at value propositions
McKinsey also discussed the topic of organizational value propositions and their power to influence the quality of talent businesses bring in. It noted that organizations, especially those undergoing digital transformations, should consider the value they offer beyond traditional total-pay packages when it comes to attracting top digital talent.
Including things such as forward-thinking culture, career growth opportunities, and attractive work environments can go a long way in luring the best and brightest digital minds. McKinsey highlighted that companies who have thought hard about their organizational culture and value proposition enjoy a distinct advantage over those who do not, as the quality of digital professionals populating these companies is often much higher.
