Technological change is inevitable, and for any business of significant size, making the digital transformation isn’t a matter of if but when. Many businesses were already engaged in their digital transformation before the COVID-19 pandemic. Work-from-home and hybrid work was the impetus for many others to rapidly start or accelerate their own initiatives. Even many companies that were reluctant to go digital have been surprised by the positive impact on ROI that their digital transformation has yielded. Embracing digital transformation now can give you a competitive advantage and reveal profitable new opportunities.
For instance, one of the most successful digital transformations of all time is perhaps the most obvious. Netflix switched its entire business model from physical products shipped by mail to digital products available on-demand. In the process, it revolutionized how people watch television. But for every Netflix, there’s a Nike or a GE, two companies whose digital transformations failed famously. This article offers key insights on how you can make sure your transformation succeeds.
- Total enterprise spending for digital transformation is expected to reach $2.3 trillion (US) dollars by 2023 (Source: IDC 2020)
- 70% of organizations either already have a digital transformation strategy or are in the process of developing one (Source: PTC 2019)
- 21% of enterprises in North America and Europe have already completed their digital transformations (Source: Forrester 2019).
There’s no stopping this shift; digital transformation is inevitable and a major key to business success moving forward. However, the top two barriers to digital transformation are employee pushback and the lack of needed skills among individuals. While traditional strategies can get you through individual reluctance, upskilling is more complicated. That’s why it’s vital to have a strategy for digital skills development.
The Impact of Digital Transformation
A successful digital transformation can bring many benefits to your business. From streamlining work processes to improving customer service to discovering new revenue streams, digital transformation should positively impact your entire organization. It can lower costs, increase ROI, and provide behavioral data that will help you understand your customers. But you can only take advantage of new technologies and capabilities if your digital transformation is done right. How do you make sure your transformation is successful and delivers maximum payoff to your organization?
The first key to a successful digital transformation is having a solid and proven strategy. The same way you wouldn’t build a house without a blueprint or fix a car without an owner’s manual, you shouldn’t start your transformation without a well-thought out strategy. Without a strategy and partner to help guide you, you risk failure of the project, the loss of confidence of stakeholders, and a lack of investment from top executives. Failure is a waste of time, energy, and money that most organizations simply can’t afford.
The second key to a successful digital transformation is making sure you develop the skills your people need to support the transformation and ensure its long-term success. Here are the most important skills your teams will need:
- Critical thinking – this is what distinguishes people from machines and it’s an incredibly valuable skill for battling technological overload. Critical thinking can help us look at problems from different perspectives, identify good and bad reasoning, and rapidly adapt to new technologies – all of which are vitally important in managing your successful digital transformation.
- Emotional intelligence – this is a skill that’s just as important as practical knowledge. Emotional intelligence allows us to balance our emotions to constructively manage problems and stress and gives us the capacity to think through challenges clearly and effectively. Emotional intelligence improves communication and collaboration and will boost your team’s ability to tackle unforeseen problems that may arise during your digital transformation.
- Collaboration – this is the skill that drives teams to succeed. The key to effective collaboration is the development of trust among team members. Showing vulnerability, admitting mistakes, allowing constructive conflict, obtaining cross-team support, and demonstrating accountability are all vital components of good collaboration. Elevating trust and freeing people from siloed, divisional thinking will help your team rise to the challenge of a complex digital transformation.
- Active listening – this skill is much more than paying attention. Active listening involves understanding the emotions of other people and the challenges they face. Good active listeners obtain a more complete understanding of people and problems, letting them more effectively confront challenges in your digital transformation and design better solutions for them.
These are only some of the skills that contribute to a successful digital transformation and as technology changes, so might the skills required. The most important thing you can do to support your digital transformation strategy is to develop a robust skills development strategy that is forward-thinking. In addition to supporting your digital transformation, a targeted skills development strategy is likely to lead to additional long-term benefits for your business, like mitigating skills gaps, increasing worker productivity and engagement, helping to attracting and retaining top talent, and making your business more competitive.
Our new e-Book outlines Nathan Furr’s proven methodology to develop your strategy for a winning digital transformation.