Digital transformation is a hot
topic in the media. Many news sites and consulting firms have published their takes
on the opportunities and threats associated with it. A Google search will
direct you to numerous articles with instructive titles like “5 Winning Ways,”
“Six Stages,” “Nine Elements,” and “Top 10 Trends” of digital change. There is
even a link to a specialized Executive
MBA in Digital
Transformation.
Digital transformation is defined
as an organization’s use of digital technologies (e.g. mobile, cloud, social,
big data, robotics) to improve how it operates to achieve its goals. It
typically alters a company’s business and operating models, including how the
organization creates value through products and services, processes are
designed, and employees, suppliers, customers and consumers communicate and
transact.
Ford Motor Company is an example of
a digitally transforming organization. Responding to socio-economic,
environmental, and consumer trends, it is evolving from being an automaker to a
car and mobility services business. As
Mark Fields, President and CEO explains, “We have
to recognize what is going on in the world around us, embrace consumers’ desire
for connectivity and mobility, and use the data available to us and new
enabling technology to better anticipate and foresee their needs.”
An account manager for a digital platform
provider told me that installing digital technology is rarely an issue. The problem
is the low levels of adoption by employees after it has been implemented. The new
functionality (or the system itself) is not used as intended, which reduces the
benefits realized from the initiative. This is not a new challenge for change
managers.
Bigazzi, a UK-based consulting
company, reports similar findings: "The main obstacles [to digital
transformation] relate to company culture, organizational complexity, and the
lack of processes that enable employees to engage, collaborate and
innovate." These potential barriers are not unique to digital
transformation; they apply to any large-scale organizational change.
Digital transformation doesn’t pose
anything new for change managers. It is a type of change just like a merger,
restructure or efficiency drive. The specifics of the future destination may include
different elements or have different levels of importance, but the process to
define it and approaches to help people take on new ways of working (mindsets,
actions and behaviours) to get there are the same.
One element that appears essential to
digital transformation is trust among stakeholder groups (networks or “ecosystems”).
As Klaus Schwabs, author of The Fourth Industrial Revolution counsels,
“You are about to define a new level of trust between yourself and your
employees, between yourself and your customers, between yourself and your key
stakeholders and shareholders, and... between you and your partners.”
Earning greater trust implies changes
to how leaders and their teams think about their stakeholders, how they engage
with them, and how they behave when doing so. As Accenture’s Technology Vision 2017 report
suggests, “To become a true partner, companies will need to shift their
thinking, and replace the immediate sales goals of the past with goals that
customers and employees have themselves.”
Digital transformation, like all
other large change initiatives, requires sound change management strategy and
implementation for the defined outcomes and benefits to be realized. Boston
Consulting Group and the MIT Center for Information Systems Research (CISR) conducted
a two-year research study of designing
digital organizations. Its analysis suggests
three requirements to design a digital business:
-
Develop a visionary business strategy
-
Identify gaps in the current operating model and identify needed
changes to them – roles, processes, ways of working, stakeholder networks
-
Create a team accountable for implementing the changes
This looks like solid change
management to me.
Phil
