Despite the ever-growing status of the digital transformation market, which is projected to grow at a compound annual growth rate of 19.1% from 2021 to 2026, the actual success rate of digital transformation is as low as between 5% and 30%.
With such risk and potential loss in return on investment when it comes to implementing digital transformation, ensuring your senior leadership team and staff are aware of digital transformation works is essential. Especially considering one of the biggest causes behind the failure of digital transformation is resistance to change within an organisation.
Treat this seven step process as a guide to ensure your digital transformation is not only comprehensive but effective in its outcome, because whilst the potential losses are high, the potential rewards are even higher. Working with a digital transformation consultant can reduce these risks even further.
What is digital transformation?
Digital transformation refers to the process of utilising digital technologies to improve the efficiency and reliability of an organisation’s operations. It essentially refers to integrating digital technologies into an organisation’s activity across all departments.
How does digital transformation work?
The process of digital transformation can be carried out in seven steps:
- Business assessment and strategy
- Corporate culture change
- Investment in technological adaptation
- Implementation of process optimisation and automation
- Employee learning and development
- Cyber security investment
- Investment in sustainability and scalability
1. Business assessment and strategy
Whilst digital transformation must be comprehensive in order to be effective, there is a high likelihood that there are areas or departments within your business that have already adopted or part-adopted digital technologies into their processes.
Departments and teams that have commonly integrated digital transformation into their processes usually include IT and marketing and sales. That said, it’s important not to cast these teams aside and tick them off the list – with the rate at which technology is developing, improvements can always be made.
It’s at the business assessment stage that you want to state clear objectives and outcomes for the digital transformation process. These will usually include objectives for:
- Improving efficiency
- Enhancing customer experience
- Entering new markets
However there should be unique objectives that apply solely to your organisation and business model.
It’s also at this stage where you will want to develop a strategic roadmap. This is where you will create a detailed plan outlining the steps and technologies required to achieve your objectives.
It’s important to get creative at this stage, remember that the whole organisation needs to buy into this new digital transformation strategy so communicating it in a way that is engaging and easy to understand could heavily influence the success of your digital transformation.
2. Corporate culture change
Whilst it can be simple to do, changing or adapting a corporate culture is always a long-term process and cannot be completed overnight.
Encourage your team to foster a ‘digital-first mindset’; an attitude of embracing innovation and an openness to change. This can be done in the following ways:
- One to one mentoring sessions
- Group workshops
- External training sessions and away days
- Hiring the support of a digital transformation expert
- Updating the internal CMS and/or intranet system
Remember that all cultural change starts with great leadership so ensure that top leadership actively supports and champions the digital transformation effort and mindset.
3. Investment in technological adoption
Investing in and successfully integrating technological tools throughout both your hardware and software is absolutely critical when it comes to delivering a successful digital transformation.
These technological tools to invest in could include any of the following five:
- Cloud computing
- Data analytics
- Internet of things
- Artificial intelligence (AI)
Now that the most effective tools have been identified and invested in, it’s time to focus on gaining a return on that investment, and it starts and ends with integration.
Ensure that these new technological tools are integrating seamlessly with existing systems and processes. This is best delivered through training and you may want to consider composing a formal learning and development programme to deliver this.
4. Implement process optimisation and automation
During your business assessment process (step one of this guide) you will have identified the most inefficient and slow processes within your organisation. These inefficient pain points are where the implementation of optimisations and automation are required most and should therefore be focused.
Using the digital technologies you have invested in, whether it be AI or cloud computing, this is where you redesign and make these processes more efficient and customer-centric. This process should effectively reduce manual tasks and increase productivity.
How do I know if I have successfully implemented process optimisations?
The answer is simple – speak to your people. By removing the often mundane and repetitive work tasks and replacing them with various digital tools, your staff should feel more valued, more effective and ultimately more satisfied in their roles within the company.
5. Employee learning and development
Step four and five are very closely linked, you cannot have successful implementation without learning, development and training within your team.
At this stage you should have clearly communicated the new digital strategy with your team that was designed at step one. Remember, it’s okay and completely logical to hire external support at this stage. In the face of change, it’s impossible for your leadership team to be completely versed in technological implementation.
Make this process exciting for employees and communicate it as a shining opportunity for them to upskill and not only make themselves more valuable as an employee but more fulfilled as a worker.
6. Cyber security investment
Whilst your organisation is becoming rapidly more efficient and more sustainable it also means that your processes and functions are becoming more reliant on digital systems, especially when it comes to cloud computing, data storage and communication.
Cybercrime is projected to cost the world $10,5 trillion annually by 2025, and this figure could rise even further if cybersecurity standards cannot keep up with the complexity and unpredictability of cyber attacks.
Investment in reliable cyber security is therefore absolutely essential, and whilst it can be costly, it’s far less costly than the potential loss of a data breach, bug or cyber attack. It’s worth therefore working with a digital transformation consultant or cybersecurity firm to implement robust cybersecurity measures in order to protect your new data and systems.
7. Sustainability and scalability
A digital transformation process is rendered useless if it cannot effectively grow with the rate at which your business is scaling and expanding.
At this stage it’s important to reflect on your business assessment and the implementation between steps two and six in this guide and identify which tools, departments and systems may need changing or upgrading as the business grows.
When looking at each step consider the following:
- Will we need to recruit more specialist support?
- Will we need to change software providers?
- Will we need to scale up our cybersecurity efforts?
- Will we need to plan future training to ensure the new digital-first culture is sustained?
- How do we train new recruits to ensure the digital-first mindset is adopted?
Asking yourself and your leadership team these questions will highlight any areas of your new digitally transformed organisation that may need to be adapted along the way to be sustainable as your organisation grows.
Final advice on how digital transformation works
Remember digital transformation is far from a one-size-fits-all process and the specific tools and processes involved can vary hugely depending on your organisation’s business model, industry, size and long-term objectives.
Digital transformation ultimately requires commitment, agility, and a willingness to adapt and change across both leaders and staff.
If you’re looking for support with digital transformation or security services, be sure to contact Fuse digital today. You can also read our digital transformation case studies to learn more about how digital transformation has benefited our clients.
Written by Aled Nelmes for Fuse Digital, the digital transformation consultancy.