Investing in the wrong technology
Organizations need to move away from large, packaged solutions towards more small-scale, cloud-based solutions in order to become more flexible to business changes and market needs. Extracting maximum value from these solutions will hinge heavily on how effectively they’re integrated. We’re also in a golden era of technological innovation and it’s easy to invest in a shiny new technology that doesn’t actually fit with the vision or strategy of the business, or even the basic principles of a Digital Transformation. RPA provides a good example of this. It is used to automate manual activities caused by ineffective systems, interfaces, and processes. However, a Digital Transformation should eliminate most of these and in a perfect world, all of them. Yes RPA will have a role to play but it’s not a critical element of a Digital Transformation. The key point here is this—don’t just invest blindly in a new technology without ensuring that it’s right for your business and fits with the wider digital strategy.
Focusing too much on Digital and not enough on Transformation
The technology is only part of a Digital Transformation, and organizations often neglect the business change and transformation side of the coin. That is because many Digital Transformations tend to be led by IT functions with minimal business input. It almost goes without saying, but a successful Digital Transformation requires IT and business to work in tandem to deliver the solution, in order for the requirements of all parties to be considered. Moreover, the technology is purely an enabler–more often than not, people are an organization’s most valuable assets and Digital is just the tooling they’re provided to allow them to perform more effectively. Employees need to be provided with upskilling or lifelong learning opportunities to capitalize on any Digital Transformation. Any implementation must also be accompanied by a strong change management, transition, and readiness approach, with important stakeholders engaged along the journey.
Failing to become an Agile organization
Modern organizations are facing increasingly difficult market conditions and need to be more agile to accommodate new technologies and become flexible to changing needs. Unfortunately, traditional PRINCE2-style waterfall delivery and the separation of business and IT is unlikely to be the most effective way of sustaining organizational agility. But it’s the model that many organizations still adopt. In order to realize the full benefits of a large-scale Digital Transformation, organizations must become truly Agile by removing bottlenecks and becoming lean. It’s no good implementing a market-leading technology if it still takes an organization months to release a new product or offering due to slow and inefficient organizational practices.
No transformation vision, poor leadership, and a culture that discourages innovation are big hurdles in delivering successful Digital Transformation. Not only does the organization need a clear digital vision that employees can buy into, but the transformation needs to be advocated by strong leaders—according to research by Capgemini and MIT, all successful transformations are driven top down, not bottom up. However, employees need to live and breathe the transformation—they should be encouraged to think differently and innovate, and be empowered to make change happen. Unfortunately, many organizations possess cultures that do not foster innovation and change—particularly in heavily regulated or traditional industries—making transformation more difficult. Organizations that do not embrace an innovative, collaborative culture will fail to realize the full benefits of a Digital Transformation.
Forgetting the customer
When it comes to new technology, the customer isn’t always right (consumers didn’t know they wanted an iPad until Apple put it on the shelves). But customers are an organization’s end users and a Digital Transformation has to benefit the customer in order to retain the customer base and market share. Organizations that undergo Digital Transformations with the sole aim of improving internal operations and reducing cost to serve may end up neglecting the customer journey and end user experience. If customers aren’t happy, they’ll go elsewhere. Ultimately, an organization might get away with an inefficient operation if it has incredible UX, but not the other way around.