The integration of digital technology into all elements of a business, radically changing how you operate and give value to clients, is known as digital transformation. It's also a cultural shift that necessitates firms constantly challenging the status quo, experimenting, and learning to accept failure.
From small businesses to large corporations, digital transformation is a must. That message comes through loud and clear in almost every lecture, panel discussion, article, or study about how firms can stay competitive and relevant in an increasingly digital world. Many corporate leaders are unsure what digital transformation entails. Is it just a fun way of saying "go to the cloud"? What concrete actions do we need to take? Do we need to create new jobs or pay a consulting firm to assist us to establish a framework for digital transformation? What aspects of our business plan should be altered? Is it truly worthwhile?
Are you ready for the digital age?
When the pandemic hit, businesses got a wake-up call about their digital readiness. Gone are the days when being digitally prepared was a secondary or tertiary concern for companies. It has now become the primary priority in order to survive in this new reality.
I've noticed a rising demand for digital solutions that diminish face-to-face encounters while also protecting consumer and staff health and well-being. This is due to the fact that digital is a faster method of execution. However, the increasing popularity of digital channels has revealed a number of flaws.
Some of us, who thought we were in a good position to provide digital services during the epidemic discovered that our offerings were not up to par.
Some clients, for example, were dissatisfied with the website's user interface. For some, searching the internet for the product was a difficult effort. Clients were slow to set up virtual call centres to answer customer questions. As a result, the customer experience was subpar.
To businesses that interact directly with customers is to try out their customer service at least once. Set up a new customer account on your website and test buying and returning anything. It'll show a lot more than you expect.
Businesses must use digital technology to close these gaps and drive growth in the new reality. This will enable the smooth facilitation of services both online and offline.
Success necessitates bringing together and coordinating considerably more resources than most executives realize. A poor performance in any of four interconnected domains — technology, data, process, or organizational change capability — can derail a well-planned transition. It's all about people when it comes to the truly essential stuff, like generating and expressing a compelling vision, crafting a strategy, altering it on the fly, and slogging through the minutiae.
In four key areas, talent is key to digital transformation
Digital transformation, more than anything else, necessitates skill. Indeed, putting together the proper team of technology, data, and process experts who can collaborate — along with a strong leader who can drive change — could be the single most essential move a firm considering digital transformation can take. Even the best talent, however, does not guarantee success. However, if you don't have it, you're almost certain to fail.
Let's take a look at the skills required in each of the four domains one by one.
Transformation necessitates an end-to-end perspective, a reassessment of how to meet customer expectations, the ability to manage across silos in the future, and seamless connectivity of work processes. These requirements lend themselves to a process-oriented approach. However, many people have found it challenging to combine horizontal, cross-silos process management with traditional hierarchical thinking. As a result, this important concept has lost its lustre. Transformation is limited to a series of incremental advances without it, which are useful and helpful but not truly transformative.
Look for the ability to "herd cats" — aligning silos in the direction of the customer to improve existing processes and design new ones — as well as a strategic sense to know when incremental process improvement is sufficient and when radical process reengineering is required when hiring in this domain.
The raw potential of emerging technologies is startling, from the Internet of Things to blockchain, data lakes, and artificial intelligence. While many of them are getting easier to use, it is exceedingly difficult to comprehend how any given technology contributes to transformative opportunity, adapt that technology to the unique needs of the business, and integrate it with current systems. To make matters worse, most businesses have significant technical debt – legacy technology that is tough to replace. Only personnel with technological depth and breadth, as well as the capacity to collaborate with the business, can tackle these problems.
As difficult as these challenges are, an even more pressing problem is that many business people have lost faith in their IT department's capacity to drive big change because many IT operations are solely concerned with "keeping the lights on." However, because digital transformation must eventually include institutional IT, confidence must be rebuilt. This means that with every technology breakthrough, developers must produce and demonstrate commercial benefits. As a result, technology domain leaders must be excellent communicators with the strategic acumen to make technological decisions that strike a balance between innovation and dealing with technical debt.
Organizational Change Capability
Leadership, teamwork, courage, emotional intelligence, and other aspects of change management are included in this domain. Fortunately, there has been a lot published about this topic for many years, so we won't go over it here except to say that everyone in charge of digital transformation needs to be well-versed in it. While we don't have hard proof to back this up, it appears that those who prefer technology, statistics, and processes are less likely to embrace the human side of change. Of course, we recommended leaders to look for employees who have strong people skills in our recommendations above.
Unfortunately, most data in many firms today do not meet fundamental requirements, and the rigours of transformation necessitate significantly improved data quality and analytics. Understanding new types of unstructured data, massive amounts of data from outside your company, leveraging proprietary data, and integrating everything all while shedding enormous amounts of data that have never been (and will never be) used is almost certainly part of the transformation process. Data presents an interesting paradox: most firms recognize the importance of data and recognize that data quality is poor, but they squander significant resources by failing to establish adequate roles and responsibilities. They frequently blame their IT departments for all of their shortcomings.
You need data talent with both breadth and depth, just like you do with technology. The capacity to persuade huge numbers of employees on the front lines of businesses to take on new roles as data customers and data providers is even more critical. This entails considering and communicating the data they require today as well as the data they will require the following transformation. It also entails assisting front-line personnel in improving their own work processes and activities in order to produce accurate data.
To Sum Up
So far, we've talked about the domains of technology, data, process, and organizational change capacity as if they were separate entities when they aren't. They are, instead, a part of a bigger whole. The engine of digital transformation is technology, the fuel is data, the guidance system is a procedure, and the landing gear is organizational change capacity. You'll need all of them, and they must work well together.
Consider the dilemma of "our systems don't talk," which plagues most businesses and is anathema to digital transformation. But to whose domain is it assigned? It's a technical issue, but it also leads to massive process inefficiencies, as explained above. However, it originates from a lack of robust data architecture, and it may involve difficult-to-change organizational structure and politics. As a result, it's possible to claim that any domain should take the lead. However, the greatest answer is for all four to operate together.
It's difficult for nearly all corporate leaders to comprehend the full potential of digital transformation without a comprehensive understanding of each domain, which is a contributing factor to many failed digital transformations. Of course, no single person possesses all of the necessary information and abilities. As a result, we've made a call to gather talent in each area.
Finally, work on technology, data, and processes must be done in the correct order. It is widely understood that automating a process that does not work makes little sense, hence process improvement or reengineering must often take precedence. Some modifications, on the other hand, will rely heavily on artificial intelligence. Because bad data stymies the creation and implementation of good AI models, data should always come first in these situations. Begin with your end goals in mind, and then devise the best course of action for accomplishing them.
Digital transformation may and should be focused on the company's most pressing issues. These priorities will also influence the talent required; for example, if the team's focus is on transforming customer relationships, the data talent may specialize in customer data, the process talent in sales and marketing procedures, and so on. More importantly, the individual must possess the four types of knowledge we've discussed and have prior experience planning and implementing any type of technology-driven transformation.
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