Why Do Digital Transformations Fail?
The road to digital transformation is not always a smooth one, and organisations that choose to go down this route do not always succeed in their digital transformations.
As an agile business analyst, I know that organisations and enterprises come in different shapes and sizes, so there is no uniform approach to digital transformation that is guaranteed to work for all.
But there are reasons why digital transformations fail that are common to different businesses, and I’ll examine them in this blog.
1. Not Understanding What Digital Transformation Means
You can’t engage in digital transformation successfully if you don’t know what it is you’re trying to do.
Digital transformation isn’t just one thing, applicable to all businesses. For some, it will be about their customer experience. For others, it could be a focus on automating processes. Certain organisations will be looking at digital transformation on several fronts, while others will have a narrower set of objectives.
But it is important to understand these objectives first, and to understand how digital transformation will enable you to achieve them.
2. Lack of Top-down Commitment
Digital transformation has to have support from the top of an organisation. If a CEO has traditional views on how things should be run and is resistant to change, then this will hamper any project from the start.
Leaders must lead by example, which means demonstrating their commitment to digital transformation to the rest of the organisation from the outset.
They should reflect this commitment in how they think, act and behave. If they fail to do these things, then digital transformation will become just another failed initiative.
3. Internal Resistance and Lack of Expertise
It’s not just leadership which can be resistant to change. People can be very risk-averse, and this leads them to feel that the way they have always done things is the best, tried and tested way.
This can create a sense of internal resistance to digital transformation.
Doing things differently can be a challenge, and it requires that everyone is on board.
Another issue can be that the expertise simply isn’t there to make digital transformation happen. A digital transformation requires focused resources. It can’t just be something people do when they’re not occupied with their usual work.
It requires strategists, innovators and experts as well as experienced employees. The right teams have to be in place to make it work.
4. It’s Only About the Technology
You can change your technology, but if you don’t change your culture, then you won’t have a digital transformation that works.
The technology simply supplies the tools for change, but it’s not the reason for change.
What it requires is a shift in mindset, throughout an organisation. People need to buy in to the change at all levels, understand what it’s for, and what part they will play in its success.
5. The Tech Doesn’t Match the Business
The technology needs to serve the business. If it’s just off-the-shelf software, this might not be sufficient to meet specific, practical business needs.
The real risk is that things happen in exactly the opposite way that they should, and the business ends up adapting to fit into the model the technology presents.
Digital transformation should ensure that any technology an organisation adopts is usable by its employees, and will help the organisation achieve its business objectives.
6. The Customer is Missing from the Equation
A vital aspect in many types of digital transformation is improving the customer experience.
Automating processes and cutting costs will count for little if they have no measurable, positive impact on customers.
Change should therefore impact positively on the customer as well as the business and the people working in it.
If this doesn’t happen, then the risk is that the competition will move in and take advantage of the situation, if customers haven’t seen an improvement in how change impact on them.
7. Lack of Testing
There are lots of possibilities with digital technology, but success comes from testing new systems and processes on users, to refine them and get them right.
If you adopt new technology but don’t make sure that it will work as an integral part of your business, then the risk is that these ideas will fail to translate into practical solutions.
The agile approach to this is to constantly test and get feedback, and to try things out incrementally, and go back to them again and again if necessary.
The objective of digital transformation should never be technology for technology’s sake. It needs to work in real world situations.
8. Keeping Everything In-house
Some organisations think they have all the in-house experience they need to make digital transformation happen.
But often, an external view will yield fresh perspectives and valuable insights that are vital to the success of the project, but which an in-house approach cannot see or appreciate.
Not only this, but bringing in someone to organise and drive the change process provides a dedicated resource to this process, and one which will work with existing resources within the organisation.
9. Failing to Plan for What Happens Next
If a business has brought in third party support for its digital transformation, it must be ready for when this support is no longer there.
This relates to mindset. Change is not a one-off project, but a constant state of preparedness.
Without this, organisations will not be able to consolidate the changes they make and go on to develop further.
Transformation should become the new normal, with digital transformation providing the platform for this to embed itself in the organisational culture.
Transform the Mindset of Your Business
If you want to know more about the benefits of digital transformation, agile working, and how to transform your company mindset, then please contact Simple Progression.
