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Say no to innovation theater. Quantify what success looks like. Encourage widespread agility. Consider these practices of teams beating digital transformation challenges.
Every technology leader knows that transformation is difficult, and digital transformation is especially so. While nearly all IT leaders (93 percent) recently surveyed by Hanover Research said that their enterprises are undergoing some kind of digital transformation, almost half of them (42 percent) indicated that they are struggling to achieve success as they fall behind schedule or their efforts stall altogether.
Those teams with a better track record of success for the digital initiatives, however, offer a blueprint for other teams seeking to increase the likelihood that their digital investments will deliver returns.
11 things successful digital transformation leaders do
We asked IT leaders and digital transformation experts to share some things that successful teams and their leaders do well, so you could learn from their experience. Consider how these apply in your organization and where you need to focus the most:
1. Seek progress rather than perfection
Perfection is the enemy of the good. And that certainly holds true when it comes to digital transformation. “Solutions, requirements, and technologies change so fast during digital transformations, leaders trying to deploy every requirement end up never moving forward,” says Pace Harmon managing director Andrew Alpert. “Set your base requirements with the understanding that you will learn and evolve over time."
2. Quantify success and track it
Articulate the value that digital initiatives are expected to deliver. “The greatest hurdle digital transformation efforts face is neither the technology nor its implementation,” says Prashant Kelker, partner for digital strategy & solutions at global technology research and advisory firm ISG. “Rather, it’s the ability to clearly define and predict the value being created coupled with a way to track that value accurately.”
As much as possible, digital transformation leaders should directly correlate inputs to outcomes. “That is where enterprises often fall short,” says Kelker, noting that there is increasing discussion of new revenue generation enabled by digital. “Almost 60 percent of organizations are actually using digital transformation to optimize operations,” Kelker adds.
3. Say no
Leaders succeeding with digital initiatives take hard lines. “They keep the scope manageable,” Alpert says, “and refrain from allowing additional requirements to expand beyond the project objectives and increase the overall risk to a successful implementation."
4. Be transparent
“In order for digital transformation to be successful, your team must operate with complete transparency," says Jay Ferro, CIO at Quikrete. "Communication needs to be consistent and flow up, down, and across the organization – whether it’s good, bad, or just informational. When bad news needs to be communicated, your team should feel empowered to deliver it without fear of repercussions.
"CIOs and IT leaders can help create this culture through consistent celebration of organizational ‘wins,’ as well as rallying around the ‘losses’ with a positive focus – and figuring out how to fix them together,” Ferro says.
5. Encourage teams to be agile – in every way
“Teams will need to be agile far beyond the concept of software development,” says Cecilia Edwards, partner at Everest Group. “Given the accelerated rate of change in digital transformations (and especially during this time of COVID-19), no one can predict the specifics of what will be needed even a year from now.”
Successful digital teams shore up foundational elements that support most initiatives and then implement transformation in stages to meet current requirements. “They then need to constantly assess the requirements and make adjustments,” Edwards says.
6. Prioritize data governance
"Digital transformation success requires data governance to ensure processes and leadership commitments are aligned with the transformation,” Alpert says. Often, IT leaders will establish a data council of stakeholders and also institute streamlined processes to ensure corporate data is accurate and the source of truth is maintained, Alpert says.
7. Proceed incrementally
“Big bang digital transformation strategies don’t work anymore; organizations need to be ready to adapt and make incremental change in response to ever-changing market dynamics,” says Sherri Brouwer, senior director of industry solutions at IT consulting and services company Avanade.
Successful teams embrace the "test, iterate, and learn" mindset across small and large products – uncovering new business opportunities, revenue streams, and changes to business processes. “Companies have to rethink now and really focus on digital transformation. Being disciplined about investing in what matters to the business and stopping everything else can create entirely new experiences and business results,” Brouwer says.
8. Insist on cross-functional approach
“Silos no longer work in a world of digital transformation,” Edwards says. Technology people and business people need to come together as one to drive toward a common business goal. “This means that those with IT roles must have a greater understanding of the business and those with business roles must become more versed in the capabilities technology brings,” Edwards says.
9. Seek to be a constantly running innovation engine
“Having sporadic ideas every so often is not enough,” says John Castleman, CEO of digital consultancy Mobiquity. “The key that leads to true transformation is having a constant churn of ideas that will help companies identify solutions.”
Those ideas are best focused on specific friction points in the value chain. “Digital transformation leaders must understand that creating an innovative culture is a precondition to success. Encouraging cross-departmental collaboration will lead to more holistic ideas that solve for the friction points from all sides,” Castleman says. “Teams should also be sure to keep ideas in perspective and process the best ideas at predictable costs to make it easier to select winning ideas and scale quickly while maintaining a realistic budget.”
10. Approach change systematically
Everybody wants change, Kelker says. But nobody wants to be changed. “Change resistance is a real and often subtle challenge to digital transformation. It’s not about launching ‘feel-good’ workshops and innovation theater.”
Analyzing processes and introducing gradual changes that show results eases users into the change is a better approach. “You don’t force the team to change,” Kelker explains. “You enable it to change itself.”
11. Put customer needs ahead of technology
IT leaders should know this one well already, but let’s re-emphasize it, since certain people in your organization may be wowed a little too much by a particular technology. “Successful businesses take time to develop a clear understanding of their customers’ needs and the holes in the value chain that this technology will solve for,” Castleman says. “After establishing the end goals, teams can work backwards to develop the technology that will most effectively transform pain points for their customers.”
The best teams involve their customers in their development and delivery process to validate assumptions and test solutions. “Allowing customers to be involved will also demonstrate a commitment to the advancement of your industry, rather than just your company,” Castleman says. “Producing truly innovative digital tools can promote cross-industry open innovation initiatives to attract ideas, talent, and potential partners.”
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