What exactly is Digital Transformation? This is the question being asked in most large organisations and has been for the past number of years. In the fast-paced world of business and technology, digital transformation has become the defining challenge for companies across all industries.
The era of devices, automation and instantaneous digital service expectations has brought unprecedented disruption, making it essential for organisations to adapt and thrive. With Artificial Intelligence the next big disruptive technology on the horizon, disruption is guaranteed to continue.
Firstly, what is a successful digital transformation? To successfully answer that question, organisations must have defined measures of success. There is a “myth” that you cannot define success factors in Digital Transformation, as it’s too complex and diverse.
The answer is measuring what matters - and what does not. Understanding these key drivers for each organisation and what will “turn the dial” will maintain focus and alignment to a common goal. These success measures are not all financial and often include benefits such as increased efficiency, productivity and employee well-being.
Businesses need a clear vision of what success looks like, and the ability to take an expansive view of how they want to transform their business. A Boston Consulting Group (BCG) report revealed for businesses that have already started their digital transformation journey, only *30% are ever successful. An even greater number (*43%) of all businesses have not yet begun to invest in a digital transformation strategy at all.
What is Digital Transformation? There are many different perspectives and opinions, our definition at V2….
“Digital transformation is the implementation of digital technology (new and existing) to create a new business model or uplift an existing product, services and operations. The goal is to increase value through innovation, customer experience or digital fluency.”
Today, more than *80% of companies acknowledge the need for digital transformation. They recognise that engaging customers in a seamless and responsive manner depends on an enterprise-wide reliance on the technology needed to communicate, engage and service clients in real-time.
In this article, I will share my experiences driving numerous customer workshops to shape transformations as well as the delivery of transformation projects, exploring the principles underpinning successful digital transformation.
These five crucial principles will help to make a successful transformation sustainable, whilst not exhaustive by any stretch of the imagination, these are consistent across geographies, industries, business size and scope.
Principle 1: Integrated Strategy
A successful digital transformation begins with a holistic strategy integrating business and technology perspectives. This comprehensive approach encompasses vision, key outcomes, technology and data, people and culture, and the roadmap for implementation. A well-articulated strategy with a clear vision will help to galvanise the team to a common goal.
Organisations can achieve transformational success by adopting an agile strategic mindset that adapts to the evolving business landscape. Research conducted by BCG shows that transformations based on integrated strategies are *82% more likely to succeed, making strategic alignment a critical foundation for digital transformation.
Principle 2: Inspirational Leadership
Leadership plays a pivotal role in driving digital transformations. To ensure success, organisations must appoint individuals who possess not only technical expertise but also a deep understanding of the business objectives, goals, and culture. These leaders must take a human-centric approach to transformation.
The leaders become change agents, inspiring and motivating team members at all levels to actively participate in the transformation journey. Through their guidance and vision, inspirational leaders pave the way for a culture of innovation and continuous improvement.
Principle 3: Business-Led Technology
In the digital era, technology is a vital enabler of transformation. Businesses must identify their transformation goals and select the appropriate technologies to achieve them. Organisations can unlock new possibilities and drive innovation by aligning technology investments with strategic objectives.
The key lies in clearly defining desired outcomes and then leveraging technology to deliver on those objectives. By placing technology within the context of business needs, companies can maximise the value of their digital investments.
Principle 4: Embracing a Beginner’s Mindset
A successful digital transformation requires a mindset that is open to new ideas, perspectives, and approaches. Letting go of preconceptions and past experiences is crucial, as approaching change with curiosity and a willingness to learn.
Embracing a beginner's mindset allows organisations to adapt their strategies and adopt innovative solutions. By constantly asking questions and seeking understanding, businesses can navigate the complexities of digital transformation with agility and adaptability.
Principle 5: Cultivating Talent
The importance of talent cannot be overstated in a digital transformation journey. Identifying and securing individuals with the right skills, knowledge, and mindset is crucial for success. The right talent brings modern ways of working and an outcome-driven approach, aligning the whole team to a common and measurable goal.
Organisations should prioritise retaining high-calibre talent and emphasise their critical role in shaping the company's future. By demonstrating the significance of their contributions to the transformation process, businesses can reduce attrition and create a workforce committed to the organisation's digital journey.
Summary
When starting your digital transformation, measure what matters - focus on measuring key outcomes that drive business results. It is important to consider the impact on the bottom line before getting caught up in the excitement of new tools and technologies.
Organisations can ensure their digital transformation efforts are impactful and sustainable by aligning metrics with strategic goals and prioritising what truly matters.
By leveraging successful digital transformation strategies, businesses can increase brand awareness, deliver a better customer experience, drive conversions on e-commerce sites, and deliver more efficient operations internally.
Don’t be afraid to start small with innovation. To drive innovation effectively, start small and focus on key areas that matter most to your organisation. Concentrating your efforts on specific strategic choices increases the likelihood of success and creates a solid foundation for future transformation initiatives.
Digital transformation is an inevitable journey for businesses in today's landscape. By adhering to the principles of integrated strategy, leadership, business-led technology, a beginner's mindset, and talent, your organisation can drive successful transformation and achieve sustainable growth.
Embrace the principles, stay dedicated, and maintain strategic thinking to unleash the full potential of digital transformation for your business.
For more helpful information from the V2 team on Digital Transformation, check out our CEO Craig Howe’s article: The 5 Principles of a Human-Centric Approach to Transformation.
* Boston Consulting Group, Flipping the Odds of Digital Transformation Success, October 29, 2020.
