What is a digital transformation?

The term ‘digital transformation’ broadly refers to the process of restructuring an organization’s use of technology so that it maximizes internal productivity and delivers higher value to clients and partners.

Long-standing organizations are often competing with ‘digital native’ companies, who are disrupting markets by using tech. Digital transformations offer unique opportunities for older organizations to accelerate innovation, advance beyond the competition, and to gain marketshare.

How can organizations lead digital transformations?

Before embarking on a digital transformation, organizations should reflect on the business outcomes that they would like to achieve. Can a digital transformation accelerate time-to-market? Can it accelerate internal productivity or enhance cyber security? Can it reduce the use of legacy software and hardware? Can it provide a more seamless customer experience?

Research shows that digital transformations conducted across an entire organization are 1.5x more likely to succeed than digital transformations that are piloted in small segments of an organization. This is an important statistic to keep in mind if you’re organization is in the planning stages.

Is digital optimization the same as digital transformation?

No. Your organization can adopt new platforms and technologies without digitally transforming. Adoption of email marketing applications or sales lead management tools isn’t considered digital transformation.

Digital transformations are built on plans to achieve fundamental, business critical goals. A clear understanding of goals is key to successful digital transformation outcomes.

What kinds of challenges emerge as organizations proceed with digital transformations?

Digital transformations often fail due to:

Poor leadership. A CEO who’s ambivalent about a digital transformation, or who’s not actively engaged in planning processes may see sub-par outcomes. These include outcomes that require the dismantling of the project.
Inadequate communication between IT and business leaders. Transformational challenges can occur when IT leaders enact abrupt shifts in structures and workflow without internal alignment.
Employee pushback. Workers may disagree with whether or not a new initiative will improve organizational functionality, and may not be willing to adopt corresponding changes to their routines.

How can organizations optimize their digital transformation processes?

Define your organization’s digital goals. Understand the true intention behind a digital transformation. Put your goals in writing.
Define digital speed. Organizations should outline how quickly initiatives need to unfold. This allows teams to anticipate and prepare to respond to internal, bureaucratic hurdles and it sets expectations.
Analyze your organization’s risk appetite. New business models may pose different legal, reputational or security risks. Are they worth the price of change?
Keep the conversation going. Whether your organization is at the early stages of a digital transformation, or has just completed a digital transformation, solicit input and feedback from employees at all levels of the organization. This will enable you to optimize current operations, and/or to embark on more impactful initiatives in the future.