Overcoming the top obstacles to digital transformation success
The road to digital presents numerous challenges as organizations strive to leverage advanced digital technologies to meet business demands, speed time to value and improve agility.
In a recent study, top executives across industries cited three of their biggest obstacles to achieving digital transformation. While agreement on what digital really means may seem like the biggest obstacle, more than half said organizational restructuring and resistance to change were their top two obstacles, and nearly 40 percent cited the lack of key digital skills.
Building a solid foundation to support digital is a critical first step. As organizations struggle to keep from falling behind, many try to build digital capabilities on top of legacy systems, making already frail systems more vulnerable. Others build out entirely new digital platforms, which can result in duplicate data and processes.
As digital teams begin experimenting, they often encounter bottlenecks due to weak interfaces to legacy systems, or they find that digital systems built without enterprise rigor simply don’t hold up.
Instead, digital teams need to create an abstraction layer to buffer legacy systems and provide consistency and flexibility while they explore digital options. This enables digital and legacy systems to move independently at the appropriate pace, allows IT to make changes to legacy systems without impacting digital initiatives, adds layers of security to legacy systems and avoids duplication of enterprise data and processes.
You should begin developing a solid digital transformation strategy by first establishing a small, integrated governance team with equal representation and influence from the business and IT, including security. The governance team will enable a clear line of communication between digital and legacy IT teams and ensure initiatives are synchronized so appropriate investments are made to harden core systems while securely exposing functionality that enables digital initiatives.
While security was not cited as one of the top three barriers, it remains a concern. With the highly-fragmented state of data across most enterprises today, exposing data sources to new digital systems creates yet another opportunity for attack.
IT and security are integral to governance to limit risk exposure as new digital capabilities are introduced. As you launch digital initiatives, especially if you are behind the digital curve, partner with digital leaders who can provide the capabilities you need to get your products to market securely while you continue learning and developing internally.
Next, identify a separate “digital exploration” team with deep cross-functional skills, for whom this will be a full-time responsibility and grant them the freedom to bypass internal rules and standard IT and change management processes. Empower them to experiment and test different technologies and have them report directly to the governance team.
Experimentation should be done in parallel with digital strategy development, as infusing strategy with real-world examples will accelerate your overall efforts and bring practical experience of what works and what doesn’t in your enterprise.
Managing change during digital transformation requires a multi-pronged approach. Establishing a timeline, issuing clear communications and conducting training are all critical elements of change management, but leveraging modern tools and creative approaches can accelerate change. For example, hire external marketing talent to produce a professional, humorous YouTube video starring your senior executives and promote it across internal and external social media platforms.
As you embark on digital transformation, it helps to consider your associates in three categories: the early adopters, the undecided middle and the digital Luddites. Unfortunately, a certain percentage of your employees will never adapt, and it is critical to identify and neutralize them before they influence those who are undecided. However, an equal contingent will typically seek opportunities to participate in leading-edge adoption.
Establish an approach for early adopters by training them first, giving them access to new tools, offering them perks that encourage early adopter behavior and rewarding them for the extra time they will need to do their jobs during the transition. Self-paced learning opportunities using instructor-led videos offer easily digestible training modules that create a pleasant user experience and help quickly get your staff up-to-speed.
Reskilling early adopters also reduces the number of skilled hires needed and helps bridge the talent gap while you seek often hard-to-find outside resources. Most organizations will need a combination of internal and external talent, depending on the culture of the company. Organizations with long average tenures or a change-resistant culture will be more likely to require outside talent, and in some cases might benefit from purchasing a small company as the genesis for their digital transformation.
Once early adopters are up and running, engage your marketing team to champion their successes through social media platforms and internal campaigns that promote associate awareness. Early adopters are your best internal advertising and can help create the momentum needed to overcome organizational inertia. The marketing team is critical to your internal change management function and key to winning over employees.
The process of digital transformation is not easy, but addressing these key barriers can help you overcome the challenges and build a digital transformation strategy that improves your business operations and increases revenues.