The “One thing” of Digital Transformation
Digital transformation is key to business growth and sustenance of organizations across industries. It has become a common belief that without digital transformation, organizations cannot survive. And this is the hard reality of today! While many organizations are still struggling to navigate the digital path, a very few are able to capitalize adequate value from its digital initiatives.
What makes digital successful? What differentiate the winners from the rest? The people response on such questions are getting scripted these days with mixed responses such as culture, stakeholder buy-in, investments, market insights, customer preferences, capabilities, processes efficiency, emerging technologies, partner ecosystem, innovative product, business re-imagination, agility, innovation, leadership etc. Unfortunately, none of these popular management keywords provide any help, clue and guidance on the “one thing” that organizations need to focus to make its digital initiatives successful. The sad part is very few organizations have patience and courage to change things, operating models, business processes and other methods.
Without a paradigm shift organizations cannot discover the “one thing” that is most crucial for digital success.
Paradigm shift for identifying the “one thing”
Many CXO’s believe digital is about topline, bottom-line improvement. But in reality it is not about just numbers. These performance numbers are primarily the outcome of digital. We know clearly that any output is derived from inputs and processing, which clearly suggest that if we expect significant changes in output, we must reconsider new set of inputs and processes to achieve it. This may appear simple, but it is not. It requires new thinking, new perspective, imagination and zeal to change.
In short, digital expects paradigm shift to deal with current processes and inputs within an organization. This simple rule holds true right from industrial age (1.0) to today’s industry revolution 4.0 (current digital age).
One may argue if things are that simple and just about input and processes, why organizations do not achieve it? Where does capabilities, people, market insights, customer preferences, business dynamics, competitive environment, market demand, technology changes etc fit in? Well, all of these are part of the inputs that goes in making of the digital enterprise and deliver digital output. Organizations often underestimate or misinterpret inputs resulting in its poor performance. There are few enterprises that just focus on processes alone and stagnate after sometime once processes are optimized and automated.
If organizations focuses on similar set of inputs with similar yardsticks/processes, it would continue to get the similar results. It need a paradigm shift to identify that “one thing”, the most significant input that can give them an edge in its digital journey.
The growing chasm between realities and digital aspiration
The poor performance of Digital initiatives are often attributed to the growing chasm (gap) between the organization ground realities, challenges and the higher expectations of senior management. It often overlooks or ignore the ground level challenges and aspire for higher results from digital programs ignoring the current state of the organization. Without fixing the chasm, it is impossible to get adequate value from the digital projects. How do organizations address the chasm? The simple answer is with new paradigm and “one thing” approach. It may apply earlier correlation of input, process and output here too to address the chasm problem within the organization.
Digital new paradigm can help filter out insignificant inputs (causing chasm) and augment new inputs that can boost organization performance. As a leader, executives must holistically assess irrelevant inputs such as poor leadership, capabilities gaps, corporate politics, poor governance, business-IT divide, poor staff motivation etc. that create a chasm. And augment new inputs such as new capabilities, new market and technology insights, rewards and recognition, innovation, new partners and startups capabilities, better governance etc.
Without understanding context of the organization in detail, its ground level challenges, it is hard to address the chasm in the organization. Organizations must identify key things that are responsible for the chasm and discover the most significant “one thing” that can act as a catalyst to accelerate its digital journey.
Technology — the most significant “One thing”
Historically, it is evident that organizations that ignored the power of disruptive technologies became extinct. With ongoing changes and advancement in technologies, how long organizations can continue to “waste” money on technology? Well, if an organization is strong believer of rationale investments, it will never get convinced with the topic of innovation, ongoing experimentation, interim failures and such things may appear as waste to them. Such organizations are more vulnerable to failure. They need new paradigm to understand how to navigate the industry with new technologies in the smaller markets, focusing on new customer segments, at times exploring newer markets by developing new set of capabilities and offerings leveraging emerging technologies.
Most of the organizations prefer to operate in mainstream market to protect its revenue and growth rate. And refrain from touching the low margin opportunities and unproven technologies.
But very few companies realize that disruption caused by emerging technologies is never visible in mainstream but originates from the bottom or the down market that are low margin, low growth markets. Confronting the emerging technologies is a foolish move in today’s digital age.
Planning to fail early and inexpensively with the emerging technologies is probably the best defence organizations can adapt to foster innovation and get the best value for their digital investments. With new paradigm of leveraging emerging technologies that has potential to disrupt the industry, it can discover the most critical “one thing” such as new business model, new innovative product, new services etc for their digital transformation journey.
Making digital a Habit
Digital is like a new habit. New habits requires change in behavior, demands new learning, strong desire and commitment to acquire new skills. It takes time and are not easy to develop. In simple terms, habit is an intersection of knowledge, skills and desire. In an organization context, the same attributes are applicable. Having good intent or aspiration or desire to go digital is not enough. It needs actions from the organization to fix the old behavior (recall the impediments causing the chasm), develop new capabilities and skills.
The new capabilities and skills can be developed by adopting emerging technologies for building value propositions for future and acquire new knowledge on market changes, technology changes, industry changes in the market where organizations operate. These are the most significant things for digital journey.
The “one thing” that organizations can do to navigate the digital journey is to develop new paradigm, build digital habits while addressing the chasm and leverage emerging technologies for building new digital value propositions.
There is no standard recipe or “one size fits all” approach for digital. The context of organization, its appetite to change, its approach to address the organizational chasm and commitment for building new digital habits will dictate the fate of the digital initiatives within an organization. Organizations need new paradigms to deal with digital.
Emerging technologies are the best weapon to deal with disruption threats and offer numerous opportunities of growth to organizations. One thing of digital primarily emphasizes on focus, commitment, new paradigm and developing new habits for doing the right things for the organization. Digital transformation is about discovering and executing the “one thing” that matters the most for the organization.