The gold rush is on, and data is presently the new gold. The present digital transformation can be classified as a gold rush. Several enterprises are rolling out holistic and costly digital transformations with the ambition of discovering an important gold vein. A small fragment of these enterprises will achieve success with their ambition, while others will find one or two lessons and also benefit from massive digital investments. Presently, the rush is still on, and things are again taking shape.
Just like in any other gold rush story, some companies will strike gold. For each of those success stories, you will unravel a different set of failures and false beginnings, which were reinforced by a lot of myths around digital transformation. Here are 10 such myths:
This is very common in the industrial sector. Most digital transformations were pioneered by engineering, information, and tech nerds who know little about business models and marketing. Therefore, most organizations find themselves in the 90/10 trap- 90% of attention, investments, and resources are channeled toward IT and Technology, while only 10% is allocated to marketing and business development.
This is risky. A digital transformation that will end up successful is in the first place, a business model, and a strategic transformation. It must be ‘captained’ by marketing and strategy. The Chief Digital Officer must also double as a great marketing expert. Lastly, the allocation for marketing and technology must be at equilibrium-50/50.
This myth holds that digital transformation is about offering digital products to clients and the market. This could be valid on paper and while developing a strategy. Nevertheless, digital transformation will fail if the appropriate tools are not made available internally. What this means is that for execution to be productive, internal digital transformation must precede the external one.
This duality strategy is always a hard nut to crack at the management level. It is easier to acquire IoT gadgets than to educate the workforce on how RPA can help in simplifying business processes and automating mundane activities.
Speed is what makes the business world tick. The transformation speed is breathtaking in the digital sector. Exciting start-ups and digital entrepreneurs take on more risk and enter the market fast than their industrial counterparts. Someone once said 90 days is the minimum duration for an industrial entrepreneur to organize a workshop. A start-up, on the other hand, will also require 90 days to implement a go-to-market plan.
If you lack the requisite marketing and customer maturity in your business model, your digital transformation will end up a failure. Several enterprises don’t develop quality customer relationships and don’t prioritize investment in digital marketing.
Several others still outsource customer relationships to the third party. You can’t design and develop digital solutions if you lack customer data. It is crucial to invest in the right marketing tools to gather customer intelligence locked up on the internet and in people. If there should exist a deep gap between marketing and sales, it could make your ambition to be rocky.
All the “over-night sensations” you will find spend years developing their concept before they get to the limelight. It would, therefore, be wrong to define transformation as finalizing on a technology roll-out or hitting a strategic milestone. Digital Transformation is a continuum that combines every phase and piece in the project development. It includes the removal of legacy innovation and replacement with emerging technologies.
For instance, the banking industry has undergone a revolutionary transformation from a paper-based cash system to an exciting digital experience where anyone can send money through their smart devices.
As revolutionary as the journey seems, it did not happen as a single project, but a product of incremental steps that took almost two decades. Digital transformation is not an over-night achievement, but a series of steps in the right path and direction.
It does not mean you have to have to be an eCommerce company. The aim of leverage technology goes beyond attaining efficiency, as well as effectiveness; it is about transforming the business and providing platforms for new opportunities.
You don’t have to overhaul the business to transform digitally; instead, you can utilize technology to enhance the core strength of your business. Also, ensure you provide meaningful employee recognition and be employee-centric. A great workforce creates a quality customer experience that is pertinent to digital transformation.
A digital transformation is a holistic series of transformational activities and investments that are carefully customized to bolster a strategic agenda. It is not about rebranding some connected products or software into a digital package. One or two digital projects don’t culminate in an extensive digital transformation. If you check the websites of several organizations, this is usually the situation.
Some manufacturing companies have also installed some new software or automated their processes; they now classified themselves as digital champions. Also, there is this belief that once you set up a technopark or an incubator, it is digital transformation. It is included, but not all in the digital transformation.
The first approach is establishing divisional and functional digital leaders and digital innovation. The subsequent step is to upskill and reskill those leaders. It means your digital academy must be practical and you must have digital learning assets and framework before launching digital transformation. Learning must precede transformation. All these are not what you begin two years to launching digital transformation.
People don’t gain requisite skills overnight, it takes time and concerted effort. Attending a conference, boot camp, or reading a book will not perform the magic too. You will need a sustained learning activity. Learning has to be an organizational culture.
If your company has been product-centric over the year, your organization will naturally possess a product-centric paradigm. It is possible you even have some service divisions in your product departments, but the chances of them being coordinated are very slim. A service mindset is a prerequisite for digital transformation. If you lack a service mentality, you can’t just expect to transition from product-driven to a solution-focused firm overnight. It will take a decade.
If your enterprise is wired for solutions and complicated service delivery, then you have a chance to succeed in your ambition. Crawling precedes running. You need to transition from products to solutions, then to connected solutions and products, and later on to PaaS( product-as-a-service). This transition does not happen in a couple of years.
Don’t even think your IT division, sales, and finance team will buy into your digital programs and innovations easily.
Someone has to bear the burden of integrating all these technologies into the existing infrastructure and the back office. This is the graveyard for most digital transformation projects.
Culture matters here. Spearheading a digital transformation as a trendy program managed by millennials in flip-flops and jeans activates silo thinking and turf wars. It is difficult to convince the IT division to synchronize an open-source Internet of Things framework into a secured and optimized IT configuration.
Some industry and consulting reports affirm that about 85% of enterprises have kickstarted some forms of digital transformation before embracing digital transformation and investing a considerable amount of money. You should deliberate on these myths so you can avoid pitfalls that make digital transformations fail.