Over the last decade, digital transformation projects have had less than a 30% success rate, with 2018 showing the lowest success to date, 16% – according to McKinsey’s latest research. With technology improving and a growing body of experience, why are results going backwards?
When it comes to digital transformation, change is often harder than normal change programs. Executives are unsure how to start as their organisations get stuck between choosing what to change first. Do they choose projects that will deliver the biggest potential return, lowest risk of failure or meet the largest competitive threat?
Because digital transformation is associated with technology, it’s often led by the technology teams. This means that the objectives are skewed towards big impact (i.e. ROI) tech platform implementations and updates. However, the research shows that the results from these projects are poor and most fail. This means that businesses are getting worse at transformation as the technology gets better.
Even more interesting is that 7% of those whose projects that were previously successful feel that the improvement from their transformation projects was not sustained as time went on. The initiatives struggle to get support in the organization, especially as people fear the loss of their jobs. The “corporate death yes” when everyone agrees in meetings but nobody adopts or changes any behaviours, is a common outcome.
A potential strategy is to approach digital transformation from an HR perspective first. Rather than a Big Bang platform change, you plan your transformation around the adoption rate of your people. You should look for the small wins, the confidence building automations that give people back a little more time each day. This could be a small bot that simplifies getting a report that you need every day or improving the expense claim process so it doesn’t take up so much time. Once one automation has helped your team save time and reduce frustration, they start seeking the next one, making the transformation conversation much easier. Why? They provide the feeling of change, crossing the boundary of fear that keeps people in their present state. These automations free up peoples’ time and start them on a journey of “what else am I doing that does not require so much effort, but actually doesn’t threaten my job”.
Internal Digital transformation is more about culture and changing how people work together to solve problems versus what the IT system does. Without the culture change, the benefits either don’t occur or don’t stick.
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