Digital transformation success is found in the execution of processes selected and developed in alignment with the needs of the enterprise.
When an enterprise embarks upon a course of digital transformation, much of the process is necessarily focused on the acquisition of new technology. Much of this acquired technology will be software—software, either licensed for use on premises or accessed under some sort of SaaS agreement.
The C-suite will be involved in almost every substantive decision made during an enterprise’s digital transformation process. They almost certainly will make the final purchasing decisions and technology selections that are key to the success of the project, as a whole.
The problem is, not everyone who occupies these senior positions within the enterprise are technically qualified to make informed decisions involving technology. Much of the decision-making may be based on familiar, comfortable and risk-mitigating factors, such as ROI, comparative initial costs and vendor name recognition.
The unfortunate fact is that, too often, the risks, costs and commitments required for the execution of the entire digital transformation project are simply so high that risk-averse managers will naturally “kick that can” upstairs until it lands in the lap of someone who is not afraid to make a choice.
Sadly, these risk-avoiding and financially driven choices are made without adequate consideration of the operational and technical merits of the available options.
The decision-making individuals are simply not equipped with the knowledge and experience required to make wise decisions related to esoteric operational processes powered by the proposed solutions.
What is the CIO’s Role in a Digital Transformation Project?
When the desktop revolution began to gather strength and LOB managers began buying PCs on their own, many companies realized the need for some expertise within the executive suite related to emerging technology.
DP managers, directors of MIS and similar folks too frequently saw the desktop technologies as fads, threats or at best, viewed them with amused tolerance.
The notion of Information Technology evolved and in the executive suite, was personified in the form of the chief information officer. The positive effect of this evolution was the focusing of technology and the alignment of technology with the mission, goals and objectives of the enterprise.
Today, the CIO is still carrying the heavy load in terms of knowing and understanding the language and technical information related to technology purchases and the necessary decisions these purchases require.
If the CIO is sitting at the table as a full and equal partner with CMOs, CEOs and CFOs, maybe this is fine. However, chances are the CIO is still somewhat marginalized. The CIO is frequently seen analogously as an expert on plumbing and wiring but, at the same time, not equipped to design the house.
Marketing, finance, security and operations managers rightfully demand input on the prioritization, selection and implementation of technology related to their particular lines of business, as well as the enterprise, as a whole.
They also may feel bewildered by the technical aspects of these processes, and the result is some level of conflict between the CIO and the other C-level functions. CIOs who speak of technical matters may be regarded with suspicion or distrust by those who are not conversant at that technical level.
A recent article in Financier Worldwide magazine tells how certain members of the C-suite do not buy into digital solutions because they are not proficient in technology.
Mike Gillespie, managing director of Advent IM, puts it this way: “Research tells us that there is a major disconnect, largely a language disconnect, between IT decision-makers and the people who work in digital security and the C-suite.”
In too many situations, the CIO is either overburdened with managing the project autonomously or faced with adversarial conflict within the executive suite as priorities are set and resources are allocated.
Indeed, a growing number of technology-related buying decisions are made today outside of the IT operation or the control of the CIO. A recent CIO Magazine article cites a report that states as much as 68 percent of technology spending happens outside of the CIO’s budget.
That is a recipe for failure. It doesn’t have to be this way.
Four Steps to Digital Transformation Success
Digital transformation is a long journey that involves the participation of nearly every person within the enterprise.
Digital transformation success is found not in the product selected, the amount of money spent or the glitziness of the solutions chosen. Success is found in the execution of processes selected and developed in alignment with the needs of the enterprise.
1. Manage the Digital Transformation Process Effectively
The transformative process must be managed from a central point. The key to this is overseeing and backing a stated commitment to change; it is not micromanaging every decision and process within the overall project.
A committee approach is valuable as long as members of the committee are able to communicate and understand each other. This understanding extends into the business processes involved, technology required and the relative priority of that aspect of the process in relation to the project as a whole.
The job of the committee is to identify and state specific requirements for each phase of the project. Following that, the committee needs to assign appropriate resources to accomplish each phase of the project and to back decisions made by individual implementation teams.
2. Establish a Common Vision of Digital Transformation Success
The first order of business is to clearly establish a common vision of success. What will a successful outcome look like in terms of the enterprise as a whole?
This is critical. A company cannot embark on a journey if there is no destination in mind. All of the maps and GPS systems in the world will not be helpful if the destination cannot be indentified.
What do you expect to accomplish within the project? Leaner operations? Better products? Higher market share? This vision will serve as the compass and lighthouse for the project down the road. Without it, progress can’t be measured. Failure and success are virtually indistinguishable.
3. Realize Digital Transformation Is Not One Project
Digital transformation is not accomplished as one project, but as many projects that are independent of each other, yet aligned with the overall success vision.
Project teams must understand and accept the nature of their projects with other projects within the overall process.
At the same time, the individual project teams must function with some degree of autonomy and operational latitude to accomplish the specific goals assigned to them.
Each project team must also understand the requirement of meshing their processes and solutions with the overall process and solutions of the enterprise. A marketing automation system that does not communicate with a CRM system or sales territory management system is useless.
These requirements must be addressed at the project level, as well as by the oversight committee.
4. Align Knowledge and Expertise with Decision-Making
Buying decisions, solution selections and process designs involve many necessary points of view. It is essential that the people who use, benefit and depend on a particular system are involved in decisions that affect the system.
Membership on project teams must be based on knowledge and expertise. Additionally, team members who simply have a stake in the success of the individual project are just as important.
Buying decisions, technology solution selections and process designs involve many necessary points of view. It is essential that the people who use, benefit and depend on a particular system are involved in decisions that affect the system. This expertise must bridge the gap between process knowledge and technical knowledge. Both are critical to the success of the project.
Managing Digital Transformation Success
Digital transformation is more than a buzzword, but it can be mismanaged toward a disastrous outcome. Successful digital transformation projects require a fundamental understanding of goals, needs and requirements.
Before any technology can be applied to a problem, the problem itself must be fully understood.
Adhering to these four basic guidelines will help the digital transformation project stay on course and deliver success.