Five Focal Points of Digital Transformation

Change is not for its own sake, digital transformation is the journey.

Today’s business is dynamic and complex, many organizations are on the way for radical digital transformation. To stay competitive, companies must move from “Doing Digital” -experimenting with digital technological tools to “Being Digital” -Commit to transforming themselves into a fully digital business powerhouse. But more specifically, what are the focal points, and how to manage change and transformation in a structural way?

The human touch will become more central to build competitive advantages: Digital is the age of people. People-centric change methodology is evident reinforcement and proof of "best practice" of digital management. By having an empowered workforce that is able to respond to changing conditions, using its own initiative can truly make a business nimble. Change is usually required when an organization is expanding its business, its mission or updating processes or technologies. For the large changes or digital transformation, vision and strategy are the most critical elements for the organization. There are two elements that are critical to bringing in the human element in a change management program: These are fairness and communication. The employees’ input helps to get to the point of change. For any type of changes, communication is critical. Once the employees feel fully invested in the change and they see upper management is fully invested in the change, then the likelihood of the change being made more smoothly exist. It also makes it possible for everyone to be on the same page speaking the same language and fosters an atmosphere of accountability.

Do more with innovation which leads to business differentiation: In order to survive and thrive, innovation is “must have,” not “nice to have” differentiated business capability in running a business today. For every initiative, you work closely with clients to articulate their important needs; define the most compelling and unique approach to addressing their needs; analyze the benefits per costs of that approach, and quantify why the chosen approach is better than the competition and alternatives. Digital innovation has a broader spectrum which includes both hard innovations and soft innovation. There are many components in an effective innovation environment or ecosystem:  Each component by itself may not cause a good environment, but collectively they can and weave an innovation ecosystem such as innovation leadership, innovation culture, innovation capability, practices, tools, recognition system measurements, risk management. The stepwise methodologies to analyze "Needs, Approach, Benefit per Costs," helps organizations manage innovation in a more systematic way to improve the innovation success rate.

Collaborative relationships will multiply and intensify digital transformation: Hyperconnectivity is one of the great characteristics of digital transformation. Organizations and their people learn through their interactions with the environment. It is the responsibility of the leaders to initiate his or her team to break the silos to realize the common goals or strategy which are far more important than the personal and departmental goals. Silos are reservoirs for homogeneous thinking, limiting the organization's creativity and innovation. Creative collaboration via integrative diversity can overcome silos. The least effective culture at fostering a digital workplace is traditional command and control environments. Fostering collaboration is the key to creating a seamless organization when in pursuit of the digital strategy. The most effective digital workplace is one where collaboration and sharing are the norms.

Technology spending will shift to enabling knowledge workers to do their job better and delight customers: All of IT spending must be looked at through an investment lens, provide a framework for thoughtful and informed decision-making, etc, for improving both bottom-line efficiency and top-line business growth. Some organizations apply the technique, either being called touchpoint analysis or another term – for identifying and tracing through the manner by which an IT initiative impacts an organization’s bottom line such as productivity and the top line such as innovation. Such analysis traces through the manner by which the organization’s business processes are ‘touched’ by an IT initiative. What returns are you expecting? When do you expect them? What risk levels are you taking on? Scrutinize every expenditure and ask if it can be done more cost-effectively; leveraging demand-side analysis with TCO shifts from technology budget to business budget discussions, to ensure that technology spending is in line with the business strategies and objectives. By identifying and visually portraying these touch points, the data and knowledge held by others can be tapped in monetizing an initiative’s benefits flows.

Organizational structures will change to break down bureaucracy and improve business collaboration, effectiveness, and innovativeness: Limited hierarchy works best in a creative environment where the free flow of ideas and their prompt implementation is a key element of success.  A flatter organization is more about collaboration: It's worthwhile to explore new models and be congruent with the words "change management"; and actually consider changing the model to meet what the future may be bringing. Many say the digital organization is a living thing to keep growing and fulfilling its purpose. The nature design allows the organization to morph as living conditions and organizational capacities change to allow a better fit for the purpose. And, when that purpose is fulfilled, or a more compelling purpose appears, then the organization can morph again and move on to the next great purpose. This requires that you start with a complete and accurate diagnosis of the organization's current state, identifying any barriers to excellence that may exist, then developing strategies for lowering or removing those barriers.

Change is not for its own sake, digital transformation is the journey. A clear vision, a systematic thinking and effective communication, the logical processes and exemplified change leadership are all the key success factors to overcome the challenges, manage changes smoothly, and make a leap of digital transformation.

Posted in: Change Management,Digitalization