There are a handful of critical topics that executives must grasp before embarking on a digital transformation journey. There is often a gap between perception and reality. What we think needs to happen and what actually needs to happen are often in misalignment. Unless we are intentional about marrying the two, the gap could carry through a digital transformation project and lead to ERP failure. Let's discuss how to bridge that gap, and what concept you should focus on mastering as you craft your digital transformation strategy.
Whether you are an executive or a digital transformation project leader, these are the core, fundamental concepts that you must come to terms with before any digital transformation initiatives take place.
The reality is that the technology you select has the least amount of material significance to digital transformation success. There are many elements of digital transformations that are more important than technology. For instance, your business process, your organizational design, your future state, and your overall digital strategy all carry more weight in driving success than the technology itself. Rather than looking at your digital transformation project as a technology upgrade, you should look at it as a grand scale business transformation that will help you get closer to your business strategy.
One of the biggest air balls that executives endure is that they believe their team will be able to adapt more easily than they actually will. It is very rare, rather nonexistent, that an executive goes through a transformation and comes out the other end thinking that leading through change was easier or even just as hard as they anticipated it to be. The reality is that change will always be magnified, and it will always be more difficult than meets the eye.
Sure, maybe you have an adaptable, entrepreneurial organizational culture, or your team understands the technology is outdated and they are verbally excited to transition to a new ERP or CRM software, but the reality is, there is so much more to the story that will make or break an organizational shift. That excitement you feel will shine brightly at the beginning of a project, but it will inevitably dwindle as the digital transformation project excels. Any type of digital change requires a cohesive organizational change management strategy that will enable your team to adapt to new business functions.
Many executives tend to manage their digital transformations through delegation to a project team, a software vendor, an implementation partner, or a third-party consultant. Don't succumb to the idea that you can hire people to do this for you. You must be involved, and you must lead the initiative.
It's the executive team that will ultimately determine the success of this project. This comes in the form of setting a clear vision and ensuring alignment across leadership when it comes to the greater business strategy and the digital transformation strategy. It comes in the form of outlining the key performance indicators that will move the needle, and ultimately taking ownership of the digital transformation project rather than passing it to a third party.
At the end of the day, it is your company, your capital, and your future as an entity. To trust that entirely to an outside third party is foolish. The executive team needs to also be bought in on the change management aspect of the digital transformation initiatives. You will be the ones making difficult decisions regarding the future state of the business and blessing the business processes that are pivoting from your current state to your future state.
Given the dismal success rate for digital transformations in the past decade, it's easy for executives to set the bar and ensure they don't mess it up. Rather than operating in fear of dropping the ball, pivot your mindset to play offense and determine what will truly enable the organization to propel itself into its future state and drive business innovation.
Sure, it can be uncomfortable when making stretch goals, but it's important. There's a good chance you'll fall short of your goals no matter where you set the finish line, so if you set the finish line too close to the starting point, you won't see the ROI you're after. Find the courage to be the catalyst as your business jumps into the current digital age.
Many executives think there is a silver bullet, cookie-cutter best practice when it comes to a digital transformation initiative. The truth is, there is not. Each organization is unique in its business operations and good digital leaders will recognize the distinct, strategic needs that will ultimately drive business value. Take the time upfront to comb through business processes and build a strong implementation plan to understand exactly what needs to happen to drive growth and optimization.
The more time you take upfront to prepare, the better your result will be. Outside consultants can't do things like data migrations, process improvements, and change management as cohesively as you can do it internally. Nobody knows your company like you know your company. Invest time and resources into doing things like scrubbing data, assessing your organization's appetite for change, and process mapping internally before you begin your search for the best software selection.
The more you invest in the change management initiatives, the better your results will be. Get it right from a people perspective. The most successful organizations are the ones that invest in change management. The companies that see digital transformation failure are the ones that don't pour into organizational change management.
Technology is only one piece of the puzzle, and without the people behind it, it will be a dormant machine. In order to reach business goals such as improved customer experience, revenue growth, or simply making sure your organization will remain competitive as the technology landscapes change, you first must start with your people.
If you are considering digital innovations for your organization, feel free to reach out to me directly. Our independent, technology-agnostic consultants are helping organizations large and small across the world in adopting technologies ranging from ERP cloud solutions to artificial intelligence and robotic process automation. We are always here as a sounding board through your digital business transformation. You can also subscribe to our YouTube channel for weekly videos about all things digital strategy.