Today, every company is becoming a technology company—whether they like it or not.
Even if it's a hardware store, like Lowes, people will come in with smartphones and headphones. Business owners have no choice but to respect that. They need to be able to deploy technology solutions to give customers the technological experience they’ve come to expect. If they don’t, Home Depot or other competitors will. And when they do, they’ll be able to provide a better customer experience.
In other words, if you’re a business owner, you need to be aware that you’re now a tech company, too—no matter your industry.
This is digital transformation.
It’s a hot topic among company executives these days, and for good reason. Emerging digital technologies are completely transforming society, culture, and business. But many organizations are unsure of exactly what this means, and skeptical about how to undergo digital transformation initiatives. And when they do end up shelling out lots of money on new tech, they’re often disappointed with the results.
For these reasons, many business leaders are leery of technology at best, and hostile toward it at worst.
But all companies have to learn how to harness emerging technologies if they want to succeed in the era of digital transformation.
Here’s what you need to know:
So, what does “digital transformation” really mean?
There’s a lot of ambiguity around the very concept of digital transformation.
At its core, digital transformation is the novel use of digital technology to solve traditional problems. These digital solutions enable inherently new types of innovation and creativity, rather than simply enhance and support traditional methods.
And in the C-suite, there are a number of differing attitudes about what, exactly, digital transformation entails.
Some understand what it is, know the world is fundamentally changing, and realize that they have to change with it. They’re taking the necessary precautions to weather the upcoming storm.
Others are aware of what digital transformation means—sort of—but don’t totally get it. Why would Lowe’s understand technology? They sell lumber and hardware. Why would Merck need to understand technology? They’re a shipping company. They aren’t Google, Facebook, or Microsoft. More than anything, they’re confused.
Still others are just plain afraid. They’ve seen other companies throw away tens of millions in failed digital initiatives at their firms. They think of a company like GE, which went out and hired 100,000 software developers and fundamentally changed who they were—for the worse. Once one of the greatest and most prolific manufacturers ever, their efforts tanked. They were even delisted from the Dow Jones.
When tech decision makers hear horror stories like these, it stops them in their tracks.
But when done right, digital transformation is nothing to fear. Digital implementations have major potential to decrease your overhead across the board. They can make everything more efficient and bring your company to even greater heights.
You just have to be smart about it.
Transformation initiatives often fail—but it doesn’t have to be that way.
All too often, companies spend millions on digital initiatives and have nothing to show for it. It’s discouraging.
Earlier this year, we had a meeting with a client. When we brought up the phrase “digital transformation,” they said, “Oh, don’t use that word. That’s a bad word here.”
It turns out they had gone through such a nasty digital transformation, they didn’t even want to talk about it. It's a very common experience, where companies are breaking the bank on these initiatives and not seeing the results they want.
When this happens, they tend to stick to their old software and never actually address the realities of our modern world in the way necessary to remain competitive.
Doing it right begins with being thoughtful and asking the following questions:
What are our goals?
Are we biased toward action?
What actions do we need to take to achieve our desired results?
You have to know what’s going to take time and be incremental with it. I call this “plant and pivot.” Plant your foot solely in an area where you know you’ve made a digital move forward. Measure, understand, and do it again. This creates a positive feedback loop of change.
The best way to do this is to find the people in your business who are passionate about technology and willing to champion this transformation. It’s the guy that buys a new iPhone every year, or the woman who always has her AirPods in. When you find these people in your workforce, empower them to help show others that technology is valuable and will help pull them along. They share that mentality and it becomes powerful.
In technological terms, the attitude of change goes viral.
Successful digital transformation hinges on communication, transparency, and patience.
Executives owe it to their team to say, Listen, this technology isn’t about replacing people. It’s about making people more effective through automation and digital technology.
Taking frequent measurements will help convince your workforce. A lot of people skip this step because, frankly, it’s hard. But knowing how the transformation is affecting your business over the long term will help show whether its working and also potentially identify other places for improvement. Understand that you need to measure your changes often and be purposeful in how you roll out the transformation. Start collecting data about how you operate and run data analytics on your invoicing processing, or your shipping, or supply chain.
Those metrics are crucial to being successful.
Patience is also a big part of this process.
If you’re giving your team a new tool, it’s going to take time to learn, so you’ll be slowing things down in the short-term. You can’t expect immediate results. When your accounting isn’t 300% more effective the very next day, remind your that team you just installed the system and it will take some time.
At the end of the day, you have to consider how technology is going to change not just your company, but your employees’ lives. Without taking your employees into account, you can’t have a successful digital transformation.
But when you communicate to your employees that you value them, frequently check in, and measure your process—“digital transformation” will be a word met with enthusiasm around your organization.