At its core, a digital transformation is all about taking the business you have today and helping it evolve into the organization you WANT to be running tomorrow through a newer and more innovative approach to technology. It’s a way to modernize your infrastructure, improve user experience, and create a bold new company culture — all at the exact same time.
It is possible to get this all wrong, however, and the results could be disastrous if you’re not careful. By understanding the top five causes of digital transformation failure, you can take steps to avoid them at all costs.
One of the most admirable things about the entrepreneurial spirit is the idea that “we can do it all ourselves.” After all, the mentality that “there’s no better person for the job than me” is a big part of the reason you are where you are right now. It’s why businesses thrive and enjoy a tremendous amount of success because of it.
It also, unfortunately, happens to be another one of the major reasons why digital transformations fail.
This is especially true when it comes to technology partners, who a lot of people make the mistake of viewing less as an organic part of the execution strategy and more like an afterthought. Make no mistake about it: they are NOT passive third parties who are going to come in when you tell them to, do what you tell them to, and leave, never to be heard from again.
If your digital transformation is going to succeed, you can’t be afraid to ask for help — and that’s especially true in terms of finding partners to come in and fill a few of the tech-related gaps that you may have. These partners need to be a part of your execution strategy from the moment you start working on it and they need to be willing to stand by your side and lend a helping hand every step of the way.
Most of the time, the types of people who initiate changes want to see results as quickly as possible. This is all well and good — unless you’re trying to implement several changes at once as you would be in a digital transformation. It’s impossible to control everything at that type of speed, so don’t even try.
Instead, slow down and pay attention to those little details. Digital transformation is BORN from those details. Scale and transform processes one-by-one and just remember — there really is no need to rush.
Another one of the reasons why many digital transformations fail has to do with the Bottom-Up Approach. That is, the advocacy for the digital transformation process begins with one or maybe even a select few employees who love the idea of automating processes, implementing new technologies, or changing the company culture in some appreciable way.
This is all great — but it requires them to essentially work their way UP the organization, getting buy-in from all key stakeholders along the way. While it’s likely that they’ll be able to get a lot of their contemporaries onboard, they’ll almost never be able to achieve 100% support — thus dooming a digital transformation initiative before it ever really had a chance to get off the ground.
Instead, you should use a Top-Down Approach where leadership buys in FIRST and evangelizes digital transformation initiatives along the way.
By far, one of the major reasons why a lot of digital transformations fail comes down to siloed activity and especially siloed information. Never forget that a true digital transformation is all about allowing a business to evolve from its very core — so anything less than an “all hands on deck” approach simply won’t suffice.
But if one department is engaged in activities that another is totally unaware of, how are they supposed to work with and complement one another? How will Department A be able to understand that what they’re doing will have a very real impact on Department B? If information is siloed because departments and individuals still want to use their own systems, how is any type of collaboration supposed to take place at all?
Thankfully, avoiding this type of situation altogether is easy — you just have to make sure that you have the right tools and resources in place before your digital transformation begins. One of those will undoubtedly be an information management platform, with M-Files being among the most prominent examples. Here, it doesn’t matter where critical information for your digital transformation happens to be stored — M-Files automatically works with many different repositories to bring everything together. All data is available via a straightforward interface that everyone in a business can access — thus allowing information to flow freely across your enterprise during a time when that is desperately needed.
Finally, we arrive at the idea of unclear goals — a problem that a lot of people don’t realize even exists until it’s far too late.
If your only goal for your digital transformation is “embrace new technology” or “gain a competitive advantage,” that really isn’t as specific as you think it is. Before you begin your digital transformation, you need to sit down and think about what you’re really trying to do. Are you trying to bring about a strategic initiative that will help your business reach a new level of revenue? Is there some other type of specific, precise business goal you have in mind? Are you trying to take advantage of process automation, remote working, or something of that nature?
It doesn’t actually matter what it is — so long as the goal itself is clear at the beginning of this process. Unclear business goals are also unfortunately the ones that you’ll have the most difficult time explaining to your employees — meaning that it’s going to be hard to get them on board, too. This almost always creates a resistance to change that is difficult to course correct from, which is why you’d want to avoid this type of situation in the first place.
In the end, don’t forget that digital transformation will impact both the experience you’re offering to your customers AND your company culture in one fell swoop. If you make the types of mistakes as outlined above, you run the risk of damaging both, at once. But if everything goes off the way it should, you’ll have the makings of genuine competitive advantage in both fields that will serve you well for years to come.