- 1 Introduction to Digital Transformation Strategy
Introduction to Digital Transformation Strategy
Just like other fancy terms which are thrown around frequently but are still largely misunderstood, digital transformation bears the same fate.
Most people think that digital transformation is all about automating processes. There is much more to digital transformation than that.
Digital transformation is all about changing your mindset, approaches, and objectives.
Digital transformation offers a host of advantages to businesses.
It can optimize your business processes, increase organizational efficiency, boost customer satisfaction, and improve your revenue.
Some of the top companies in the world know this which is why they have invested heavily in digitally transforming their businesses.
If you want to achieve the same success with digital transformation as some of the best companies in the world, then you will have to rethink your digital transformation strategy, if you already have one or create one from scratch if you don’t have one.
In this article, you will learn about seven things you should rethink when creating a digital transformation strategy.
It all begins with a change in mindset. Steve Hall, president of ISG EMEA advises businesses too, “Stop doing the normal things” and “Do a strategic review of what’s worked.”
Many businesses in Europe still rely on brick and mortar stores to sell the products.
When this pandemic hit, countries went into lockdown forcing these businesses to shut their doors temporarily or permanently.
Businesses who have already used online mediums to sell products are the ones who survived. This has forced businesses to re-evaluate their business model and eliminate what is not working.
2. Service Providers
Most IT service providers offer business contracts that tie them in. This forces them to stick to the same service provider.
Businesses should also have a business continuity and disaster recovery plan just in case something goes wrong. Let us say, you want to buy a VPS, choose an IT service provider that does not bind you into a contract for many years. This will help you prepare for similar future incidents that can put your digital assets and business continuity at risk.
Assess your IT needs and have a budget. Choose an IT partner that shares that same values as your organization. Compare prices, offerings, and limitations imposed by different IT service providers before making the final decision.
3. Digital Transformation Approach
The way you choose to digitally transform your business makes a huge impact on the success and failure of your business.
Cecilia Edwards, partner with Everest Group highlighted a common misconception prevalent amongst businesses when she said, “Many firms used assumptions about the channel preferences of their customers – usually assuming only the younger markets prefer digital – to slow down the breadth of the digital transformation efforts.”
To change your current digital transformation approach, you should start from the top. Once you have the support of top management, create a digital transformation strategy.
When you have a game plan and strategy, you can easily minimize disruption. Soon, your employees will start to see change as a norm instead of an exception. This is when the digital transformation is fully implemented.
4. Embracing Project Management Approaches
One of the biggest mistakes businesses make is that they try to implement project management methodologies and approaches for digital transformation.
What they don’t realize is that the key to success in digitally transforming your company is to migrate from project mindset to product mindset at every level of your organization.
The biggest problem with the project-based mindset is that it delivers poor customer and employee outcomes in long term.
Instead of focusing on metrics such as time to live and chasing milestones, you should approach digital transformation with a product-based mindset, customer focus and divert all your energies towards activities that make the biggest difference to your organization.
5. Decision Making Process
The pace at which things move in the business world forces you to adopt a real-time decision-making process. Instead of waiting for a quarter to review the progress, it is important to tell your employees that they are moving in the wrong direction when things go wrong before they move too far in the wrong direction.
The focus of higher management should be on policies, processes, and investments when making decisions.
Top management should have special powers allowing them to take rapid decisions on the fly, so they do not have to wait for the executive committee and a long decision-making and approval process.
The leaner your decision-making process and the fewer steps your decision-making cycle contains, the better as it allows you to take real-time decisions which is the need of today’s rapidly evolving businesses.
6. Digital Transformation for The Sake of It
Make sure all the digital initiatives are approved before pursuing them. Do not pursue them based on assumptions.
Only take your digital initiatives forward if it enhances the customer experience, delivers business value, and aligns with the business objectives.
Do not just blindly continue adding new digital channels especially if it does not offer a better customer experience.
Even if something is working for your staff does not mean that it will bring utility to your customers. Design your digital initiatives based on customer feedback.
Digital initiatives that do not pay attention to customers usually fail and also hamper your progress towards the digital transformation of your company.
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7. Incremental Improvement
Before the pandemic struck, most organizations were making changes at the edges of their operating model. Many have already adopted the agile methodology which relies heavily on bringing continuous improvements in iterations.
Unfortunately, that approach is no longer reverent as it delivers a lower return on investment when you compare it with the cost of capital.
Most importantly, the minor changes brought at every interaction is not enough to keep up with the external pace of disruption. Instead, businesses are better off adopting AI-powered tools and algorithms that allow them to