10 lessons learned from digital transformation

by | 24 Jul 2020 | Business transformation

Incremental improvement is not enough to win in today’s exponentially disrupted business environment, says Karen Thomas-Bland, founder at Seven, a business transformation consultancy based in London. 80% of CEOs say they have digital transformations in place and based on the pandemic this is likely to accelerate faster than planned. From experience, there are 10 key areas to consider when embarking on a digital transformation.

1. Regular board conversation

It’s important for the board to ask on a regular basis are we at risk of being disrupted or are we disrupting others? When thinking this through and identifying potential competition and acquisition targets, it’s important to cast the net wide, beyond the obvious.

2. Start with strategy

In moving forward with a digital transformation, the first step is to identify new and existing capabilities required to meet the strategic ambition. The capability set should include both existing and new capabilities. A digital transformation should be guided by the broader business strategy, rather than the starting point being ‘we need to adopt AI’ or ‘we need to implement RPA’.

3. An understanding of how the operating model needs to evolve

It’s important to consider how the operating model needs to evolve whether it’s to reduce costs, grow the top line, extract greater value from data and technology, embed a different culture and/or deliver a more engaging customer experience. Questions to consider include is your operating model flexible? Has it been pivoted around new demand and opportunity? Do you need to think about new services and products to offer or modify existing ones? Does it sustain the value creation born from the crisis?

4. Commitment from the top

Commitment from the top of the organisation is needed to rethink and retool across culture, processes and technology. Experience shows it’s the cultural/behavioural changes that most likely impede the transformation effort. There needs to be leadership and sponsorship from the board, Executive and those in functional and regional leadership roles. Any transformation should take up significant leadership time and attention and all roles need to pull in the same direction.

5. Develop next gen skills

It’s important not to forget the talent needed. Ability to adapt to an even more digital future depends on developing the next generation of skills, closing the gap between talent supply and demand, and future-proofing your own and others’ potential.

6. Manage four interrelated parts

Manage the four interrelated parts throughout the transformation: people, technology, data and process. Assembling the right team of technology, data, culture and process talent who can work together and having a transformation lead to orchestrate these efforts is necessary, so efforts are integrated and sequenced.

7. Understand how technology contributes to transformational opportunity

The complexity often comes in adapting technology to the specific needs of the business and integrating it with existing systems. Complicating matters is most companies have embedded legacy technologies that are difficult to change.

8. Work on securing a good baseline of data quality and analytics

As The Economist highlighted, one of the most obvious consequences of the current COVID-19 pandemic will be ‘the infusion of data-enabled services into ever more aspects of life’. For many companies their data is not up to a certain standard and the rigours of transformation require a good baseline of data quality and analytics capability. Transformation likely involves understanding new types of unstructured data, integrating massive quantities of data external to the company, leveraging proprietary data, building predictive capabilities and integrating everything together.

9. End-to-end mindset

Transformation requires adopting an end-to-end mindset, a rethinking of ways to meet customer needs, seamless connection of work activities and the ability to manage across silos going forward.

10. Transformation capability

Transformation capability is required to drive the change process, pull together all the component parts, have the right sequence of activities and move from pilot to scaling. Companies may face a choice between accepting long delays in ramping up production or attempts by leadership at rapid, unwieldy change to meet what they have promised.

Based in London and with over 24 years’ global experience, Karen Thomas-Bland is often cited as one of the top business transformation consultants and coaches in the world. She is a trusted advisor to boards, executive teams and investors, creating sustainable, long-term value for FTSE/Fortune businesses and PE funds. She writes for many publications including The Times, FT, Association of MBAs and Management Today.