How To Prepare For A Successful Digital Transformation

 Regardless of industry or geographic location, digital transformation is high on the list of nearly every corporation's top priorities. As companies look for ways to keep up with the speed of technology, the exponential increase in available data and the demands of clients and other stakeholders, having a thoughtful and attainable digital plan is critical. Such an aggressive yet intentional approach to transformation will change your way of working and how you build and deliver services.

Three Macro Pillars Of Transformation

Before any organization pursues a digital transformation, they must first build three macro transformation pillars — culture, talent and technology: 

• Cultural transformation is how your company thinks about its approach to work, how you think of your company and how you want your customers to perceive your company. The way you worked for the past 20 years isn't sustainable for the next 20. A willingness to embrace change — while maintaining the key cultural elements that make your company unique — is mandatory for any company seeking to make meaningful change.
• Talent transformation is an organizational transformation that focuses on the talent you want to attract or retain. In order to keep pace with change, you need to build or acquire new skills. As the war for talent continues to escalate, you must be committed to educating and developing your employees in order to upscale the workforce while maintaining institutional knowledge. Of course, sometimes you must go outside to acquire your organization's new skill sets, but if you can teach existing employees new skills, you’ll build loyalty, reduce turnover and ultimately save the company money.
• Technological transformation is how you leverage new technology, move away from outdated processes and adopt more automated and data-oriented systems. New technology and applications are important if you're to meet the demands of your clients — but without a commitment to also transform your culture and develop your talent, investing in technology can result in limited improvements.

Once you've committed to cultural, talent and technological transformation, you're ready to proceed. However, communication and buy-in are also requirements for success. You must seek out alignment and agreement before you dive in because if you get downstream without everyone being on the same page, your transformation will have to go backward before you move forward. Here are some considerations to help drive alignment.

Change Management: Difficult, But Critical

Change management is a critical element of a successful transformation, but it is also the most difficult. Proper change management requires a purpose: What do we seek from a transformation? Why is it worth the considerable expense and effort? What prize is on the other side? Everyone in the company, from the board to the staff — including customers and partners — should understand why the transformation is important, what's in it for them and how everyone will be better off on the other side.

Sharing Lessons Learned

It’s vital to keep all parties informed. Because things can and will go wrong, the only thing that keeps everyone aligned is communication — where we are going, why we are going there and why this or that is okay. Communicating these points once is not enough. When attrition happens and people are changing roles, continuous and ongoing communication is important to keep everyone aligned. Additionally, sharing progress and small wins is important to keep people engaged and management aware of the progress (which can sometimes be painstakingly slow).

Getting The Board On Board

A big transformation can come with a hefty price tag, so justifying this to your board of directors means making your case. Every company is different, but consider the following as part of your justification:

• What direction is your industry going with regards to technology? For example, if the whole financial services and insurance industries are changing, you want to be at the forefront of this change.
• Have you adequately invested in technology over the past five to 10 years? The likely answer is no. Think about how to demonstrate where and how you are underinvested in technology. Not just actual expenses, but opportunity costs. True, you can save a dollar on tech today, which may reduce your quarterly expense ratio, but what are you missing out on in one, two or five years?
• Where are the other opportunities to open up new markets or distribution channels? How can a digital transformation help drive standardization and efficiency? If you are an acquisitive company, can you make the case that digital transformation can help make future integrations more efficient?

Your board also wants to see how those investments are generating results and value incrementally because these outcomes will not happen at the flip of a switch. Incremental results and value ensure that you are heading in the right direction.

Keep An Open Mind

Transformation is a journey, but it is not a straight line. Be prepared to engage with an open mind.

When a lot is changing around you, the lack of stability can be challenging. It can create a lot of discomfort and awkwardness. Some things are abstract. But therein lie the opportunities and challenges.

When you start seeing subtle changes, you can tell it's working and things are moving in the right direction. It will start in small pockets, with a few players. The important thing is these are the right pockets because the right players will be catalysts who can affect others.

There's no secret formula. Keep an open mind and take the crooked path toward the right direction. You’ll succeed as long as you are determined to drive the outcome, have decent support at the ground level and the right support at the top level.

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Article Source: https://www.forbes.com/sites/forbestechcouncil/2022/02/17/how-to-prepare-for-a-successful-digital-transformation/?sh=60b5ae7c7e89