The pace of business change is so rapid now, that digital transformation has become more than a one-off initiative.
The ability to digitally transform, and to continue to do so, has become a requirement for an organisation to capitalise on market opportunities ahead of competitors.
Despite this, research is revealing that the majority of organisations are ill-equipped with the knowledge and skills to carry out successful digital transformation. For instance, a recent survey conducted by Harvard Business Review Analytic Services, revealed that only 20% of organisations had successfully transformed their business, placing them in a niche category of Digital Leaders.
If an organisation is to succeed in today’s rapidly evolving, competitive business landscape we need to start breaking down the barriers that prevent digital transformation. In this article we identify the common factors that prevent change and how you can overcome them.
Barriers to success
There are four stand-out factors that contribute to a failed digital transformation program.
1. Lack of digital leadership
For digital change to be effective it needs to be driven from the top down; a transformation will not get far if the main stakeholders don’t understand it. Yet according to a study conducted by CIO.co.uk and CSC, 39% of CIOs surveyed reported that there is a lack of “board level” understanding of the digital agenda (and how it impacts the business). Harvard Business Review (HBR) confirms this, their study found 57% of organisations in the Laggard category reported lack of leadership understanding was a key barrier to successful change.
2. Cultural resistance to change
Research released by Capgemini and MIT cited that people and culture are the biggest barriers to digital transformation. As reported by Fast Company, study co-author Andrew McAfee states, "you should never underestimate the fondness of people and organisations for the status quo." HBR’s findings support this notion; they found that 44% of Laggards reported cultural resistance to change compared to 30% of Leaders.
3. Legacy processes
Overcoming the status quo also extends to the processes already in place. The HBR study also found that ingrained legacy processes were one of the top blockers for Digital Leaders – 43% said that they struggled to change the way people performed familiar tasks.
4. Lack of strategy
MIT Sloan Management Review and Deloitte’s 2015 global study of digital business found that only 15% of organisations in the early stages of digital maturity had a clear and concise digital strategy; whereas 80% of digitally mature organisations did, indicating that this is a key measure of success.
How to breach the barriers
1. Set your strategy
First things first; you need to set up a strategy. The most successful strategies demonstrate how technology will support the entire organisation to deliver on the transformation vision.
MIT and Deloitte's research project noted that companies in the early stages of digital maturity tended to focus more on individual technologies, thus taking a siloed focus. Whereas digital strategies in mature organisations think of technology in the context of transforming the entire business.
When you’re mapping out your technology strategy, look for solutions that traverse multiple departments. Focus on solutions that foster widespread integration, ultimately helping disparate departments work towards the same vision and goals. That way you can focus on transforming the entire business, unifying departments in the process and replacing outdated legacy systems.
You should also outline to your executives any additional resources that will help the business minimise operational disruption. These should include staff training, and if in budget, external consultants that can implement the technology itself.
2. Embrace cultural change and new ways of thinking
To shift cultural resistance you need to change people’s perspectives. Time-poor, busy individuals are likely to see digital transformation as a friction point, and the less tech savvy are often fearful of the change. Pushing your organisation towards a “digital mindset” involves tactics such as finding digital champions to lead uptake and support their peers, or providing monthly incentives to top users of the digital platform. Circulating success stories that clearly describe the benefits of using the new technologies is also hugely influential in encouraging company-wide acceptance.
We’ve saved the most important for last – education is one of the key drivers of digital transformation. The role of the CIO and CTO is changing; for a tech implementation to be successful there has to be an increased focus on mentoring in order to bridge the gap between departments and their view on technology. In doing so you can foster increased digital leadership and take another step toward breaking down cultural resistance to change.
Education can be split between three parties;
- Your senior executives: Leadership must understand the ways in which new technologies will support the transformation of the business. So invest time in bringing them up to speed. Demonstrate the new solution and discuss the expected impacts its introduction will have on staff and operations. Explain how the provision of sufficient educational resources and tools for employees will minimise any negative impacts. Remember to show them the cost of doing nothing, and the predicted gains of the change.
- Your employees: Ensuring that staff have the skills to use the digital tools you’re adopting is essential to transformation success. This will speed up adoption and give your less tech-savvy employees greater confidence. Educational resources can take many forms: from face-to-face training and peer mentoring to on-demand training resources, or even better, a blend of all. However you do it, providing access to skills will help your staff to embrace the change.
- And last but not least yourself: Business landscapes and technology are constantly changing so keep your ear to the ground. They best way to do this is consult news, tech sources and digital transformation experts to stay on top of the latest trends and breaking innovations. This way your solutions won't date and you can tweak them wherever necessary – ensuring your company can continually move forward.