Successful digital transformation goes beyond the tech
According to Statista, global spending on digital transformation should hit 2.4tn USD by 2024 and digital transformation is currently the No 1 IT initiative within companies.
Digital transformation is rapidly climbing up company agendas with the race to leverage technology to increase competitiveness and customer experience but what springs to mind when we tune in to this subject? Is it the shiny new ideas around digital products, services, and technology or the discussion around driving more innovation and actionable insights through data? My one watch out for any company building their digital transformation journey, is there is one critical thing that is often forgotten within the discussion and will get in the way of embedding great ideas and tools within your organisation and that is building a digital culture with your people. You may have a great digital strategy and you might have the best tech, but are your people ready for it?
How building a digital culture can drive the success of your transformation
In a Boston Consulting Group (BGC) study of 40 digital transformations, companies that focussed on culture were 5x more likely to achieve breakthrough performance than those who neglected to address culture and 80% of the companies who focussed on culture sustained strong financial performance v 17% of those who ignored culture. Also when comparing digital champions and laggards across 1900 companies in the US and Europe, BGC found the digital champions who embedded digital practices and behaviours scored 14x higher on the digital acceleration index and the impact of culture was greater than digital initiatives and recruiting digital talent.
So how can culture change enhance your digital transformation?
Company culture is an interesting topic. Even when "this is the way we do things here" is written down in black and white, there is so much more to it than that. Culture is both the written and unwritten rules around the people you hire, the way you work together, the processes you follow, and the mindset and values you uphold as a collective. It's that feeling, behaviours observed and values experienced when you enter the office, attend a meeting or open your emails. If your culture is not reflective of the new practices expected for your digital transformation, the result can be confusion, change resistance and a frustrating loss of traction.
In my experience, the critical steps to successful culture change and transformation are to ensure you achieve transparency, alignment and accountability throughout your organisation on the change required. By addressing the following key questions, you will lay the foundations to start your digital culture building journey.
- How aligned is your company culture with the transformation you want to achieve?
- Consider the mindset, values, and processes required to achieve your transformation
- What cultural obstacles will prevent you from achieving your transformation?
- How will you communicate the why for your digital transformation?
- Why are you going on this journey and how does this align with the company priorities?
- What will be the value to the customers, organisation and employees for the long-term?
- What is the potential impact of failure on your customers, the organisation and employees if you don't succeed?
- How will your employees understand their role in your digital transformation?
- What will a great transformation look like for your organisation and how will you measure success?
- How will the customers and employees feel?
- What is the mindset and behaviours required from everyone to make your digital transformation a success?
But who's responsible for building the culture?
Effective leadership is a must for building a digital culture, however, I am not only talking about top-down leadership - building a digital culture must be owned both horizontally and vertically within your organisation to succeed. The pace of change with digitalisation means it is not about the senior leadership team and/or project lead having the answers but the organisation learning together on how to make it happen and how to make it work in the most meaningful way. Developing a learning culture where those with the knowledge can come forward and lead where required, is critical to the successful leadership of a digital ready organisation.
When reflecting back on change management projects that I have led or been a part of over the years, we have achieved some great successes where the impact has been clear which has been hugely satisfying, however I have also experienced change initiatives where significant time and money has been invested and the new initiative has not lived beyond roll out or beyond a General Manager's country assignment.
So why have some transformations worked and others not? Culture alignment is without a doubt a critical step to organisational transformation, however leadership culture both formal and informal is the golden key to embedding meaningful change for the long-term. When employees understand you have a culture of learning where informal leadership and the sharing of knowledge and views is embraced at all levels, that is where really exciting things can happen with transformational change. The informal leader that is valued for their input into the company transformation versus having a transformation happen around them, will be motivated to bring their best for the greater cause.
The 5 steps to building a digital culture and transformation
- You have a clear vision, culture change requirements and communication plan for your digital transformation journey
- Communication is brief and frequent to maintain alignment, take feedback and drive fast learning and decision making
- Customer focus is your priority
- Every decision, objective, action, recognition and reward is invested in the value delivered for the customer
- Cross-functional collaboration occurs horizontally and vertically across your organisation
- Alignment and informal leadership are encouraged and championed across all corners of the organisation to build your digital capabilities
- You encourage employees to discover, test and champion new digital technologies to reach the right customers in the right moments
- Employees are encouraged to lead and are recognised when exploring and seeking new customer solutions with an innovative approach
- You are working quickly and iteratively to deliver
- An agile team mindset is in place to deliver with a fail fast learning approach
Are you ready to take the next step with building your digital culture? For further information on how we can help you, get in touch to discuss your requirements and we will suggest the best approach for you.
