The critical factors that shape the success or failure of digital transformation aren’t secrets, they’re people says Dr Karen Luyt, Snr Specialist: Digital Transformation at BCX.
Digital transformation fails. In fact, it fails slightly too often for comfort. McKinsey says 70% of transformations fail. BCG says only 30% of companies get it right. KPMG puts the percentage of failure at 73%. Considering how beneficial digital transformation can be to the business and its bottom line, it’s time to turn the percentage on its head. To take the 70% of failures and turn them into a 70% success rate, and the way to do this is through people.
Leadership is perhaps one of the most important success factors in any digital transformation strategy. Decision-makers and leaders need to know exactly why the business is undertaking specific digital transformation initiatives and have a clear vision of the digital journey. What do they want to achieve? Why do they want to achieve it? They need to converge their understanding of digital with the realities of the business to ensure that technology is strategic and relevant.
Even though digital transformation (DX) has been around for more than 10 years, the technology around it is changing at such a rapid rate that many companies are still trying to keep up. Legacy technology remains firmly in place as leadership pedals at speed to keep up with the next innovation or relevant aspect of digital transformation. Those who fell behind with DX were forced to catch up in 2020, and since then they’ve been on a pedal boat down a waterfall as they’ve had to plug holes, fill gaps, and meet changing market and employee expectations.
Moving forward, leaders need to understand how to take the two concepts of digital and transformation and wed them to the true hiccups in the business. Digital is about making the business more digital, about implementing automated workflows, artificial intelligence (AI), digital paper trails and improved processes. Transformation is about taking the digital beyond optimisation and efficiency and into the realm of radical changes to work, business and service models and offerings. It is a combination of two factors that create explosive value if visualised clearly by leadership and used effectively by employees.
The second challenge that often inhibits the success of DX is the expectation that it’s a one-stop solution. It isn’t. It’s an iterative approach that’s more about the journey than anything else. There are maturity levels associated with this journey that start at the digitisation of information – shifting from analogue and physical to digital formats – through to the digitalisation of processes and ways of work within the business. Each organisation will be at a specific point in the journey which means that any DX approach must be uniquely crafted to this point – it is not a one-size-fits-all, it’s a pragmatic and strategic approach that’s customised and curated to slip seamlessly into the organisation.
People are going to make the technology work. So yes, leaders set the tone and lead by example by using the technology and being visible in the project and they need to set the vision for DX in such a way that everyone can read the room. It’s here, it’s yours to use, and it’s powerful. Then, it is critical that the people using the technology in offices, coffee shops and homes are given the support and tools they need to make it work. They need to be ready, and if they’re not ready, there has to be awareness and training throughout every initiative. When people buy into the digitisation of systems, then they will be the fuel that ensures the engine keeps driving and that the enterprise enjoys the journey.
By prioritising people and the journey towards a clearly defined goal, DX becomes far easier to implement and far more sustainable. This commitment to putting people at the heart of the strategy while creating vision that ensures it is the right strategy turns the DX statistics on their head. From 70% failure to 80% success, it’s about vision, people, and finding the right road.