Is Your Digital Transformation Set Up to Fail? 4 Warning Signs to Watch Out For
According to McKinsey, 70% of complex, large-scale change programs don’t ever reach their goals. Given the time, energy, and money that companies spend on large transformation programs, the fact that the majority of them fail is discouraging, to say the least.
However, there are some powerful lessons to be learned here. How can we study digital transformation failures and come away knowing what not to do? How can your company make sure it’s among the 30% where digital transformation succeeds?
RelationEdge specializes in helping companies navigate powerful business transformations, and we’ve learned quite a bit along the way about what makes for a successful project. We’ve identified some telltale signs you can look out for along the way to ensure you’re staying on track:
1. Your Leadership Team Doesn’t Believe the Transformation Is Critical
You’ve probably heard that any change management initiative — especially one as involved as a digital transformation — requires a champion on the executive team. It’s also commonly noted that your CEO has to be completely behind the endeavor in order for it to work.
While those sayings hold true, they’re also not enough on their own. John Kotter, who literally wrote the book on change management, notes that in order for real change to occur, about 75% of a company’s management must be “honestly convinced that business-as-usual is totally unacceptable.”
If your management team exhibits signs of lukewarm support or even indifference when it comes to digital transformation, that’s a major sign of problems down the road. It indicates that many people in the organization don’t understand or believe that digital transformation is critical to the company’s continued success — and if they don’t believe that, they won’t be motivated to change their behaviors.
2. Though It’s Been Months, the Vision Is Unclear
If your digital transformation team has been working hard for months but your company’s CEO or its line employees still can’t concisely explain the vision behind the transformation, there’s a disconnect.
It could be that the digital transformation team hasn’t developed a compelling vision or that they haven’t adequately communicated it. Either way, this needs to be addressed quickly.
Without a clear, compelling vision, employees won’t understand the point of digital transformation. The transformation effort may become sidetracked with a list of confusing initiatives that take your company in the wrong direction. Individual departments may not understand how the changes they’re being asked to make relate to what’s happening in other departments or in the organization as a whole.
As a general rule, if the vision can’t be described in five minutes or less and if employees who hear the vision do not react in a way that demonstrates they understand it and are interested in it, the vision needs to be further refined and better communicated.
3. There Haven’t Been Short-Term Wins
It’s no small thing to ask employees to undergo a digital transformation. It requires them to give up the comfortable work processes they’ve grown accustomed to in favor of new, often more time-consuming ways with uncertain outcomes.
That’s why it’s crucial for your staff to see short-term wins. Asking employees to go a year without seeing any wins worth celebrating is unreasonable. They need evidence that the journey they’re on is taking them somewhere worthwhile.
Without short-term wins, your company risks turning enthusiasm into indifference. Employees may give up and begin to resist the change.
4. Your Company Doesn’t Have Clear Targets
Even if your digital transformation has a clear vision and high-level goals, it needs those goals broken down into specific, clearly defined initiatives. According to McKinsey, nearly three-quarters of companies that were extremely successful in meeting their transformational goals had broken down their change process into this type of clearly defined, smaller initiatives.
It’s easy (and fun) to dream big — but with a digital transformation, you have to start small first. Clear, unambiguous milestones must be defined and tracked. Otherwise, your digital transformation risks being pie in the sky that never actualizes down on earth.
Digital transformation is never easy, and it’s natural to hit bumps along the road. Knowing what to look out for along the way can help you recognize signs your transformation is off course, and make adjustments as necessary.
Partnering with a digital transformation expert like RelationEdge is one way to ensure you’re set up for success. We’ll take a thorough inventory of your business processes, find out where you want to go, and develop a roadmap to get you from current to future state. Contact us today to get the conversation started.