But what are the key challenges of digital transformation? How do we overcome them?
As you can see, a successful digital transformation reaps many rewards for organisations who put in the hard work. Although, it does not necessarily come easy. Digital transformation is constantly evolving, and not everyone is willing to get on board.
Change is difficult. You can never enact change and not receive a level of pushback. Digital transformation presents the possibility of employee pushback to cultural changes. For employees, it could mean a challenge to their role or even a possible loss and this negativity seeps into the culture of the workplace. As a result, these oppositions can lead to trouble with digital projects getting funded or resourced, there are unreasonable levels of certainty required to fund them and often they are completely overlooked. When people aren’t willing to invest in change, your business suffers.
Completely erasing doubt and uncertainty is not always attainable, but it is certainly possible to alleviate them. By being consistent and transparent, you keep employees involved and informed throughout the whole process. Empower them by painting a future they can all work towards, through relevant digital transformation strategies.
Challenges can also present themselves where there is a lack of vision for the digital customer journey. Without a clear vision of how to meet digital needs, companies may find themselves lost and uncertain. Over time, you must develop this vision, set relevant objectives and then execute your strategy.
To overcome your lack of vision, you can begin by:
- Taking stock of your assets – your customers, your brand, your intellectual property and your strengths.
- Study your market – understand what your customers need, and how you and your competitors aren’t meeting those needs.
- Be on top of technological trends – do your research, keep track of emerging technology and study the shifts in consumer behaviour related to technology.
- Finally, establish processes that are designed to generate portfolios of potential ideas for the future. This allows your business to enact possible scenarios and test them against real research. That way, new ideas come about that align to your vision of customer interaction.
Another challenge of digital transformation is an ineffective gathering and leveraging of customer data. In the age of Facebook, Netflix and Amazon, we understand more than ever of the importance of customer data. Many organisations are aware and have systems containing this data, but no clear way of how to use them to their advantage.
To ensure you are making the best of the information you receive from customer data, you must take a simplistic approach to creating value from the beginning. This ensures you are in a good position to start looking at the more complex customer data, and considering how some of that data can enable you to further enhance customer experience and add value to your business.
Digital transformation is closely linked to the software and infrastructure of your business utilises. Overly complex and rigid legacy IT infrastructure can present many challenges to your transformation. If you continue to rely on a product or principle of structure (that has secured your survival in the past, you will not be securing survival in the future). Similarly, if you are not willing to part with your traditional server environment and invest in Cloud services, you are missing out on the benefits of a flexible, more agile workforce.
When you accept the risks and cross the murky waters to digital effectiveness, you will discover a level of scale, revenue and profit that you don’t find with legacy infrastructure. Sometimes providing services for free that were once charged, selling subscriptions which were once one-off fees, monetising through advertising rather than other avenues and simply rethinking the way you derive value and revenue can be risky, but you must run those risks in order to move away from tradition and do the best for your business. Failure to change shouldn’t be the end of the road for your business.
No digital transformation can succeed when IT and business goals do not align. It is no longer a question of IF businesses are going to utilise technology, but HOW and WHEN they can do so. If you are viewing IT as an end unto itself, rather than a means of achieving business goals, you are doing digital transformation wrong.
When you approach marrying your business goals to your IT goals, you must ensure a top-down educational approach. Strive to inform all employees and leaders to help create a proactive stance that formulates strategies based on understanding what is really possible. This approach also empowers the organisation. All of this is meaningless if the results aren’t measured and you must choose the right metrics to ascertain what outcomes they expect IT to provide. Maintaining this IT and goal alignment is a constant work in progress.
Digital transformation does not always work well for everyone and can mean that there is a lack of expertise in the organisation. You may not have hired for technical skills but rather for relevant experience in the field and skills related to this. This creates a shortfall in staff that are equipped to handle and implement digital transformation.
This goes beyond training your office to be digitally literate; it’s perhaps more about changing their thinking and behaviour. Investing in your people allows you to be ahead of the game. With insightful, dedicated training, you can get your employees up to speed. Alternatively, focusing on digital competencies during the recruiting phase means you are hiring for more than just field experience, building that expert team from the get-go.
Lastly, budget limitations create massive obstacles to digital transformation. Sometimes, budgets are designed for at least six months to a year in advance, which makes no room for up-and-coming digital investments. Similarly, budgets are handled by the ‘top’, and redesigning business to create new value comes with limitations and hesitations to enact budget changes from those in control.
By being well aware and well prepared for budgetary constraints, you are being realistic about your digital transformation. Sometimes budget limits also mean you can be more practical about what your company can actually handle during its transformation journey. You can develop a plan that involves several phases over many years, so you are not at immediate risk of budgetary issues.