Successful Digital Transformation: How to Start
Successful Digital Transformation: How to Start
By this point in our post-COVID world, most companies have implemented at least a few technologies to adapt to our new reality.
And with changing customer preferences, supply chains, and processes, many businesses are now thinking about a wholesale digital transformation in order to remain competitive.
But you’re likely struggling with a common question when it comes to digital transformation: How to start?
This post is designed to give you a starting point for your company’s digital journey, along with an awareness of your current strengths and vulnerabilities.
From there, you can begin thinking about how you can shore up vulnerabilities and leverage strengths into processes that make customers see you as the only logical choice.
Tip #1: Understand the possibilities
How did Netflix put Blockbuster out of business?
By understanding what technology could do for their business and their customers.
Blockbuster understood that they could rent movies to people who came into their stores.
But Netflix understood that they could provide a much larger selection of movies, let customers browse from home, mail them out, not charge any late fees, and ultimately provide unlimited streaming movies and TV for a modest subscription fee.
Taxi companies understood that they could transport people from A to B.
But Uber understood that they could transport people, pick them up within minutes, introduce the driver, show what it costs, and automatically process payment.
What could technology do for your customers? What would their experience ideally look like in our suddenly-changed world and beyond?
Naturally, many of your initial answers will be dictated by customers’ immediate needs.
That’s fine. Just keep the larger picture in your mind.
In our suddenly-changed world, what processes, features, and experiences do your customers want most?
Tip #2: Imagine the destruction of your business
You’re likely thinking that Coronavirus has already done this.
But try to think of what opportunities might be found amid the challenges.
Gather some team members and ask the question, “In addition to the changes we need to make as a result of the virus, how could competitors and potential disruptors further destroy our business model?”
After all, remember that everyone in your industry is making the same basic changes that you are now; but how might they be going above and beyond?
Answers will depend on your business, of course, but might include things like, “They could provide made-to-order products at scale, with two-day delivery.”
Or, “They could provide ingredient traceability and production information from field to fork in one click.”
Or, “They could make telemedicine the standard for primary care consultation.”
Here is your opportunity to create the customer experience of the future, instead of clinging to a dying business model.
Tip #3: Evaluate current processes
Where are the inefficiencies and bottlenecks in your current processes? How can technology help you streamline your operations?
You don’t need to understand every technology solution out there.
Just ask your employees what is slowing things down, or what seems harder and more complicated than it needs to be.
Ask how it’s affecting them, and how it affects customers.
Ask them what they would do to change it, if anything were possible.
You’ve likely already discovered a lot about what’s working well with your processes (and what isn’t) as your workforce moved to fully or largely remote.
Just as you’re making continuous strides in transforming the way your team works, you can do the same with all your systems.
It’s important to keep in mind that you aren’t merely making changes – the goal is to fundamentally shift to a digital business.
We asked Rob Llewellyn, CEO of CXO Transform and bestselling author of The Transformation Files for his take on this crucial distinction:
“Digital sugar coating and the delusion of digital transformation have already resulted in countless leaders announcing their ‘transformation’ when in reality they were only undergoing ‘change.’
As a consequence, many well-intentioned CEOs led their companies into decline.
It is vital that leaders understand that transformation creates a new future without the constraints of the past, while change only creates a better version of what already exists.”
Transformation creates a new future without the constraints of the past.
Tip #4: Evaluate your digital platform
Is your company trapped in legacy spaghetti?
This is a term technologists use to refer to digital platforms with tangled code, proliferated systems build on top of one another, and unnecessary complexity.
As a result, processes are harder to change, full customer views are almost impossible to accomplish, assumptions are harder to test, and agility is unachievable.
On the other hand, a well-designed digital platform allows for instant analytics and customer personalization, synchronized multichannel operations, scalability, and centralization.
If your platform is mired in legacy spaghetti (which is almost always the case for any company over 10 years old), focus your initial digital investments on platform redesign.
In fact, there’s a good chance you’ve already started this as part of your COVID-related efforts.
As you continue, take care not to recreate the problem by haphazardly bolting things on, Frankenstein-style.
A clean platform is the foundation for all the rest of your digital efforts.
Tip #5: Build awareness among stakeholders
In many companies, especially in slow-to-change industries, lack of urgency has been a big barrier to transformation.
Until this COVID hit and forced everyone’s hand, senior-level team members may have been in the “wait and see” trap.
Others may have been in the “too much hype” trap, and still others may have been in the “overwhelm” trap.
Now that everyone must transform whether they want to or not, it’s a good time to discuss the big picture rather than just the immediate patches.
Stakeholders, now more than ever, are suddenly aware of the impacts of doing nothing, as many companies are now dealing with the fallout of postponing their digital changes.
That awareness allows you to more easily make the case for steady and incremental digital implementations.
After all, as Jack Welch famously observed, “If the rate of change on the outside exceeds the rate of change on the inside, the end is near.”
Stakeholders, now more than ever, are suddenly aware of the impacts of doing nothing.
Tip #6: Just get started!
Ok, so you know that COVID is forcing every business to become digital.
And you know that ultimately, becoming digital is a wise and profitable business move.
But you still may be not be sure of your first step.
If you’re thinking of legacy modernization, do you choose a full or partial migration? Lift-and-shift or cloud-native? Which apps do you move first?
If it’s data analytics, what do you want to start discovering? Are you collecting all the data you need? What unknowns are you trying to clear up?
We asked Greg Verdino, Fortune 500 Digital Transformation Advisor & Co-Creator of AdaptManifesto.org, for his advice to companies in this position:
“The biggest challenge today isn’t aspiration – it’s action. Every successful transformation journey I know of began with a single step.
Identify a pathfinder project that is important in terms of potential impact but constrained by what’s possible in terms of time, resources and risk.
Be sure this project is clearly defined, has tangible outcomes, involves multiple stakeholder groups across the organization, and – when it succeeds – helps prove the validity of your digital vision.
Beyond that, be prepared to prove success incrementally, then replicate and scale what works.
Ultimately, transformation is a process of revolution through evolution that moves your organization toward a state of always-on adaptability – not merely a one-shot change.”
Digital Transformation: How to Start – Conclusion
Now that transitioning to digital is not just important but urgent, you could actually be in a better position than some of your competitors.
They may be partway through their technology initiatives and must now suddenly shift gears.
You have the opportunity to transition to technologies that reflect where your systems and customers are now, where they’re headed, and the trends that will shape business in the long haul, post-Covid.
