A survey recently conducted on directors, CEOs, and senior executives showed that digital transformation (DT) related risks were their main concern in 2019. But out of all the DTs initiated, only 70% reach their goals. Approximately $900 billion of $1.3 trillion spent on digital transformation in 2019 went to waste. In Africa, specifically the opportunity that digital transformation brings is enormously promising. So how can we change the thinking of our leaders and enhance our leadership development short courses to ensure that leaders across the continent take advantage of this opportunity?
People’s mindset on change and the organizational practices greatly determine the success or failure of the DT. This is because a DT magnifies the strengths or flaws of the organization. But we only have to look at the opportunity that digital transformation can bring in order to make this change worthwhile. The statistics below from the Brooking Institute outlines the opportunity well.
Lessons that lead to the success of digital transformations in organizations are:
Lesson 1: Before investing in anything, you must understand your business strategy:
Leaders aiming to enhance organizational performance through the application of digital technologies often have in mind a specific tool. Business strategies should, therefore, be the guide to digital transformation.
A company should establish specific goals to achieve to decide which digital tools to be adopted.
A good combination of technological tools delivers speed and innovation to an organization and may vary from one organization to another due to their varying goals.
Lesson 2: Pivot around the insiders:
The best approach to digital transformations is to use the organization’s staff that have sufficient knowledge of the company’s processes and operations, thus know what works and what doesn’t work, rather than the outside consultants.
The staff of an organization are in a better position to recommend tools, processes, and key elements of a system to be adopted as they are the ones that interact with the customers; thus, they understand them better. Therefore, overlooking the insider knowledge while implementing new technologies leads to failure in organizational productivity improvements.
Lesson 3: Customer experience design from the outside in:
Efforts must be made with the help of in-depth customer input to ensure customer satisfaction and intimacy while implementing DT. The company should interview the customers to realize its strengths and weaknesses. This would also help the company to identify the customers’ needs and priorities to ensure a better service to them.
Maximization of customer satisfaction, however, is achieved through small-scale changes to various tools at different intervals of the service cycle. The customers’ input thus determines where and how to alter.
Lesson 4: Address the fears of employees of being replaced:
Employees may consciously or unconsciously resist changes if they feel threatened by the digital transformation. The management may abandon the efforts of digital transformation with the thought of saving their jobs when it turns out to be ineffective.
Leaders should identify those fears and stress on digital transformation processes being an opportunity for the employees to improve their skills to suit the future marketplace.
Employees should also be given a chance to identify their strengths and unique contributions to the organization and connect it to components of the digital transformation process. The employees will, therefore, have control over how the digital transformation will turn out and give the employees a chance to improve on what they are already good at doing.
Lesson 5: Adopt a Silicon Valley start-up culture:
Silicon Valley start-ups have speedy decision-makers, rapid prototypes, and flat structures. In the digital transformation process, changes and adjustments are provisionally made, decisions rapidly made, and involvement of all organizational groups as the process is inherently uncertain. The flat organizational structure should be adopted and kept separate from the rest of the organization.
Most digital technologies can be customized, thus more need for agility and prototyping that in other change-management initiatives. Therefore, the leaders must be ready to make crucial decisions such as which apps from which sellers to use, the business area to target while implementing new technology, whether to roll out the transition in phases, among others. Decision making on the most suitable solution requires lengthy experimentation on interdependent parts.
However, the impact of some digital technologies is only seen when the new system is implemented on a big portion of the company. This effect becomes evident as various employees of the company interact with the system and provide feedback regarding the functionality of the system.
Digital transformation works best for companies whose leaders go back to the basics, that is, focusing on mindset change of its team and the organizational culture and processes before deciding on what digital tools to use and how to use them.