Recently, we posted a roundup of some of the current articles on technology initiatives during COVID-19. Today, we’d like to offer some concrete digital transformation advice to companies moving forward.
McKinsey points out, “If necessity is the mother of invention—and it often is—there could be some positive outcomes of the coronavirus crisis. These are unlikely to come anywhere near to compensating for the human and economic toll it is wreaking. However, given the general shortage of optimism at the moment, it may be heartening to consider a few encouraging possibilities.”
Included among those possibilities is this: Businesses can come out of this crisis more resilient, more prepared, and more innovative than ever.
With that in mind, we spoke to consultants, futurists, and thought leaders to get their take on how companies should move forward today.
This digital transformation advice is geared specifically to those companies who, pre-COVID, had not yet started a transformation journey in earnest, and now may find themselves wondering how to begin.
Here’s what the experts say.
“In kicking off a digital journey, think 4 S’s – Have a simple objective in going digital, make sure your leaders are actually aligned behind it, start small, and sustain energy by not overloading leaders, people, or teams.
These things sound basic – but in practice they are proving really difficult for organizations. Poll the C-suite of many digitally transforming organizations, and you’ll hear a completely different account of what digital transformation means from each leader. Or you’ll hear somewhat similar, but really convoluted accounts – which is equally unhelpful.
Moving from strategy to implementation, you often see problems because the organization went for a ‘big bang’ approach and realized all of the leaks in the pipes, so to speak, too late…when small experiments could have allowed them to learn more, faster, at lower cost. Or maybe they start with great momentum, but wear their leaders and talent out just as quickly with ‘too much, too soon.’
Starting digital transformation off right means slowing down to speed up – which asks leaders to be humble and thoughtful.”
“I organize a group of chief strategy officers from large enterprises and the challenge of advancing along the digital journey comes up often.
Invariably, our discussion leads fairly quickly past the tangible – understanding the technology, mapping customer journeys – to the softer and more human challenges of changing culture so that the people who will be running the new digitized organization shift their behavior.
This includes getting people to start trusting data rather than their guts and industry experience, building data analytics capabilities and deciding where in the organization this should sit, and moving from a model in which digital is centralized to a holistic model in which the digital mind-set is broadly shared and understood.
The answer to these seems to start with leadership prioritizing a broad cultural change effort, which requires true belief and persistence in order to succeed.”
“My single biggest piece of digital transformation advice to companies about to start is to understand the principles upon which their transformation is based.
Stephen Covey taught us that while values govern behavior, principles determine consequences, and we know that the best leaders steer their organizations based on principles.
There are six guiding principles of digital business transformation known as THRIVE – the first of which requires leaders to understand the difference between Transformation and Change.
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.
Once the CEO and their leadership team share a common understanding of this guiding principle, they can begin to embrace the other principles and orchestrate the legitimate transformation of their business.”
“My digital transformation advice is to get started immediately, because you are lagging behind your industry peers and other competitors that want to disrupt the markets your business serves.
This is even more true today as digital companies have the culture, agile practices, data, and technology to enable pivoting and adjusting to the COVID-19 health and financial crisis.
Starting doesn’t require a grand digital strategy or a substantial upfront investment. It can begin with a leader, a dedicated team, a vision, and a series of quickly executed experiments that enable data capture and learning.
Leaders should focus on customer-facing and growth areas first, as these should help define the new products, customer experiences, and business models. To be successful, executives must be willing to challenge the status quo and promote data-driven decision making.”
“When it comes to digital transformation, 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 toward some ‘new normal’ that emerges on the other side of a one-shot change.”
“As the wave of coronavirus immobilized businesses and societies worldwide, many companies prioritized business continuity and resiliency initiatives. The main focus has been to enable core operations, as well as remote access for the employee base. As a result, digital transformation initiatives, deemed as long-term change, have been frozen to make way for short term, operational priorities.
Instead, I would advise companies to accelerate digital transformation efforts to better position their company after the pandemic passes. Not all digital initiatives can be carried out, and prioritization is required to focus investments and gain maximum returns from digital initiatives.
Top priority should be offered to investments in digital systems that enable companies to optimize their core business and daily interactions. For example, quickly implement online platforms that enable collaboration between teams or automating processes. These short-term investments contribute to boosting employee or process efficiency.
Additionally, optimizing the ways to engage and interact with customers would be highly impactful. For example, apart from online stores and social media, there are many affordable augmented and virtual reality solutions that offer immersive, near real-life engagement and create a ‘wow’ effect for customers.
In terms of the longer-term view of digital transformation advice, I would advise companies to start by assessing their digital maturity to identify gaps and determine where to focus their transformation efforts. A clear strategy for digital transformation is also critical.
This process will take into consideration external forces that disrupt business operations and how the company could navigate through it by leveraging digital technologies. Based on the digital transformation strategy, develop a digital target operating model for the next 1-3 years that will withstand future disruptions.”
“The nirvana of transformation is what I call ‘digital platforming,’ where everything you do has an interconnectedness. This lets you respond, react, and deliver at speeds exponentially better than ever before.
So if you have a problem with a product, you can instantly relay that problem straight back to product design, marketing, sales, and even supply chain.
Take Zara, for example, the world’s most successful clothing retailer. They get feedback on the shop floor from customers that instantly goes to other departments.
So they may say, ‘We don’t have the right color or size in the Barcelona store,’ and the supply chain is instantly alerted.
Or, ‘Customers say this item is too small around the arms,’ feedback that instantly gets delivered to product design.
It’s this sort of adaptability and transformation at the core that will define the new business normal.”
With so much uncertainty about where we will all be next week, let alone next year, it can be hard to feel confident about making such fundamental changes to your business model. However, one thing we can be sure of is that the worldwide move to digital has been vastly accelerated, and is here to stay.
As McKinsey puts it, “Research and experience show that those acting with a through-cycle mindset will be best positioned to accelerate out of the downturn…Companies that move early and decisively in a crisis do best.”
Do you have questions about how to strategically implement digital transformation advice in your company, while minimizing risk and maximizing ROI?
Contact us for your ideal path forward.