Recent events, throughout the world, have highlighted the need for businesses to be more flexible in providing digital tools to help clients and employees alike adapt to the ever-changing conditions we find ourselves in, all while staying on the frontlines of a wildly competitive market.
Near instant response, coming up with new business models and technological solutions, is paramount to keeping up with the constantly changing needs and supply of your business.
The big question is, how do businesses and their leaders adapt to these new attitudes and expectations from both their employees and clients?
Answer: Digital Transformation.
To begin, let’s clear up some industry terms;
Digitisation – is the process of changing from Analogue to Digital – Gartner
Digitalisation – is the use of digital technologies to change a business model and provide new revenue and value producing opportunities – Gartner
Digital Transformation – is the process reimagining the business in the digital age by using digital technologies to create new and/or modify existing business processes, culture and customer experiences to meet with the changing requirements of the busines and market – Salesforce
Each one of the above incorporates increasing areas of change to create innovative solutions to improve the customer and employee experience.
Digital Transformation is about ‘people, process, tech’, in that order. The following Venn diagram visually represents this concept using the above-mentioned definitions.
It should be noted, none of the aforementioned is restricted to a specific company size or type. In theory it may be even more relevant for smaller businesses as they are more nimble, adaptive and quicker to change if the digital transformation is managed properly.
Unfortunately, B2B IT Marketers have co-opted these terms. This means anyone selling a document management system, for example, is calling is digital transformation, when in essence what they are actually doing is installing a new departmental printer with an automatic widget and some software that turns documents into PDFG’s stored on SharePoint, which is in fact digitisation with a hint of digitalisation.
Primarily the objective of digital transformation is focus on the customer and employee experience in order to create positive business outcomes.
Digital transformation is about creating new business models intimately tied into the commercial strategy making sure they are increasingly agile and resilient, the focus becomes more customer and employee centric rather than product centric, for example, and the ways of working are made more efficient e.g. automation, this prime targets for this would include high intensity, low value, repetitive tasks
For all of these processes to have the most valuable impact is it vital for businesses to focus on the culture of their company first. Ensuring cultural transformation is worked on prior to the implementation of new processes and technologies.
Elements of cultural transformation that are catalysts for digital transformations to happen successfully include;
- Creating the right environment to celebrate successes and failure
- Encouraging innovation, collaboration, self-development and learning
Celebrating failure may seem odd however, these moments are intrinsic in the learning process. Learning from what does and doesn’t work opens to doors to new ideas and paves the way for new initiatives.
It has been found 70%, some reports even go as high as 85%, of digital transformation programs failing as a result of a business’s culture not being favourable to change and/or the acceptance of new ways of working i.e. the lack of underlying initiatives and imposed changes coming from the top. Other reasons include; politics, power struggles, silos, lack of knowledge etc.
On the frontlines of any business are its employees, who are intimately aware of the challenges of existing processes and often have ideas for effective solutions to improve these processes.
Employees value and appreciate being included as part of discussion around business processes. Additionally, it is the employees who those most affected by outmoded processes, and they are a vital resource in the developing of new ideas as they hold a wealth of, extremely valuable, information.
Keeping this in mind, it is important to remember how employees may be affected when a consultant is engaged to develop or update current business processes and systems. If the consultant hired has not done the proper research into challenges the business may be experiencing an then proceed to implement changes with a ‘we know best’ attitude, employees may then disengage, lose commitment and purpose in their work.
This leads to a compound effect:
- The new process won’t work
- The people able to fix it have either lost interest and no longer care, or have left the business, taking the wealth of information and knowledge with them
These risks need to be managed appropriately.
During the turbulent times of the COVID-19 pandemic, businesses and organisations already relying on digital channels have been thriving. For example, all hospitality business with a partnership agreement with Uber Eats have continued to operate successfully and are even thriving.
Business with eCommerce platforms have also experienced incredible growth. Online sport, meditation, chess, karate etc are businesses who rapidly pivoted to digital channels and have also managed to weather the storm. In contrast, it took Australian Supermarkets, who already had an online delivery service, close to 3 weeks to increase enough scale into the business to accommodate the surge in online purchases demonstrating the digital channels they had in place were not up to par.
While no one can predict an event like a pandemic, a business plan and strategy plan should be resilient and have contingencies built in.