The digital transformation of today’s businesses is more a matter of when it will occur, rather than if it's needed. Global marketing firm IDC reported in 2019 that 85 percent of enterprise leaders have started this process or plan to do so within the next two years. This accounts for massive investments in cloud resources, data center technologies, security, and training.
While there's a high level of commitment, in theory, getting it done successfully for the entire organization can be tricky.
Dell Technologies and Intel conducted a study about digital transformation that indicates there is a solid commitment to investing in digital transformation in these areas:
- Cybersecurity – 58%
- Internet of Thing – 46%
- Multi-Cloud – 44%
- Artificial Intelligence – 40%
But there are challenges. In fact 91% of businesses in the Dell study reported consistent barriers to accomplishing their digital transformation process. Not surprisingly, Forbes reports that only three percent of enterprises successfully complete their digital change.
The most common reasons for failure include
- resistance to change
- lack of agility
- inadequate cloud resources
How to Start the Digital Transformation Process
Forward-thinking leaders recognize that digital change greatly affects a company's culture, processes and technology, which is never easy. But it can be done. The best approach is using a methodical process that builds upon itself for more and more digital transformation over time.
There are a few different ways you can assess what to do first. Consider:
- What are your most manual processes that, if automated, could give employees the most time for other activities? Strong candidates include employee on-boarding and off-boarding, order-to-cash processes and a virtual helpdesk. These processes lend themselves well to answering questions with a chat bot that uses machine learning (ML) to improve its answers over time.
- How many different teams are going to be affected at once? You might start with digital transformations that will impact your IT team the most and then move to transformations that would impact departments where you may have fewer technically-savvy team members.
- If the digital transformation process that you’d like to tackle will affect a system used company-wide, such as accounting or the customer relationship management system (CRM), you may want to try other transformations first and then work on those that will affect the most people later. If you are going to impact a widely-used system, find a way to keep your users’ current tools intact while automating some of the processes. This is a win-win and will typically cause less friction from the team.
- Lines of business (LOBs) may drive decisions about which digital transformations may be most important to complete first.
Initial Stage of Digital Transformation
One of the most common digital transformations is the automation of common business processes. You don’t want to change all the processes in a widely used platform all at once. For your initial stage of digital transformation, choose one area to focus on. It’s at this point that you need to identify your change management process. Without it, your initiative is likely to fail.
Change management for digital transformation use cases
When choosing a digital transformation activity, such as a process automation, it’s easy to identify what has to be done. Where it can become difficult is trying to get buy-in from all the people who are involved. Change is hard for some people and they’re going to resist unless you have a plan in place for explaining what and why you’re asking for change. What is your plan for addressing how the employees’ jobs will be changed before, during and after the process is complete? There should be people who specifically handle change management in any digital transformation.
The benefits of transforming manual processes to digital ones offers a great potential for savings. But the best laid plans can be sidetracked if you aren’t tracking the results to prove they’re worthwhile. Be sure you know how you’re going to measure success before going any further.
Middle Stage of Digital Automation: Creating Playbooks
Once a digital automation is in place for a specific process and functioning regularly, you can consider it the middle stage.
At this time you can start to develop a playbook that can be used for future digital transformation implementations. To create something that is useful, try to do the following before recording your best recommendations for future projects:
- Run a cost-benefit analysis of the first use-case to help identify excess costs in the first year. And, over time you can see how your expectations turned out in actual cost and time savings.
- What are the technical aspects that you would recommend for consideration on future use cases? This might include hardware, software, the technology vendors you used, and any other services that you found helpful as part of the process.
- If you used third party vendors to complete the transformation, are there things you learned or processes you used that you want to use again (or don’t want to use again). Note vendors that were great to work with and those that weren’t as knowledgeable or as easy to work with.
- Consult with those who participated in the first transformation use case to see if there are things they’d do differently for future projects. Consider surveying the employees for their feedback on how successful the automation is. Ask questions about the communication process before, during and after the implementation. And also ask them about how their job function is better (or not better) as a result of the automation.
Growth Stage: Power Users to Help Others Adapt
A business has several use cases deployed by the time it reaches the growth stage of digital transformation, even if they aren’t specifically related to one another. This stage is a good time to identify which business processes can be removed from the organization because they’ve been automated.
You should also have a plan in this phase for how you’re going to improve the employees’ digital skills and increase comfort with the technology they need to use to do their jobs. As a part of improving digital skills you may want to identify power users who aren’t in the IT department (in other words: find those who aren’t overly tech savvy) to serve as champions for using the new processes. This can increase adoption among their peers and the organization can start to see the savings sooner. In the case of larger organizations, this step should be done before releasing the platform to end users or making a center of excellence (CoE).
The growth period may also include:
- Infrastructure changes that will decrease costs including moving to a cloud platform.
- Additional change management based on issues that arise when you take the automation to more and more users. The less frustration experienced by users, the quicker you’ll have cultural adoption of the technology.
- Nurturing the power users to be sure they’re having a good experience and address issues they’re seeing so you can hopefully avoid them when you get to a larger scale.
Mature Stage of Digital Transformation: Serving as a Thought Leader
At this point a list of best practices for your digital transformations should be complete, including the integration playbook. There may be phase 2 activities that you’d like to implement, especially if doing the entire transformation at once was going to be too much for the users.
Thought leadership is also an important factor once an enterprise is ready to perform in new ways with respect to digital processes. By sharing what you learned, you’re able to help other companies with their processes and lead your industry.
The IT team is always on the lookout for digital transformations that can save time and money for your organization. Change can be scary, but when you have a plan in place and a trustworthy track record of helping your employees through it, you will reap the benefits of making these changes throughout your entire enterprise.