Despite the value and increasing importance of the digital sphere in business, terms like ‘digital transformation’ regularly come across more as generic buzzwords than anything else. People hear about the value of digital transformation without understanding its purpose, much less when or how to carry it out in practice.
In a recent webinar, Good e-Learning invited digital transformation specialists Richard de Kock and David Cannon to answer practitioners’ questions. These experts offered insight from their own experience on how to make the most of digital transformation in several different industries and even took various popular digital and IT frameworks into account.
In this article, ‘5 Quick & Effective Ways to Drive Success in any Digital Transformation Program – Part 4’, we provide the answers to the final round of questions.
Mark: What are the aspects or dimensions of digital transformation? How are the benefits measured? How do the major roles contribute to the process of transformation? What are the responsibilities of these major roles? Why do many organizations fail to achieve transformation objectives within time and budget? What are the skill shortages to meet the demands of increasing transformation needs?
I will try and address these below, but given the broad nature and number of questions you have, I would recommend as a start reading ‘Leading Digital: Turning Technology into Business Transformation (G Westerman, D Bonnet, A McAfee)’ and the more recent publication, ‘The new elements of digital transformation (G Westerman, D Bonnet)’.
I have grouped the questions in the hope that this produces a more focused response:
1. What are the aspects or dimensions of digital transformation?
a) Customer Centricity/Experience – This is the designing and management of customer experiences and understanding customer behavior
b) Operational Excellence – This is how Operations is to be managed, automated, and made more dynamic and agile to keep up with both customer demands and strategy
c) Strategy and Innovation – This involves understanding your organization’s strategy and ensuring it is aligned to the market and customer needs
d) Governance and Leadership – This ensures there is leadership, as well as a workforce that is enabled to deliver against the transformation (organizational change management) and how governance will be performed to ensure the organization is transparent and trusted by customers
2. How do the major roles contribute to the process of transformation? What are the responsibilities of these major roles?
Depending on the size of the transformation, it would typically involve:
- The Board:
o The need to work with others to define a compelling vision and be actively engaged and visible throughout the transformation
o The need to ensure the strategy is up to date and made available to all employees
- Business and Enterprise Architects:
o The need to define the current organizational capabilities and the required capabilities, and define the required target operating models and roadmaps to lead the transformation
- Customer Experience Manager / Leads:
o Defining customer personas and journeys
o Leading customer-centric approaches and cultures
o Understanding customer behavior and highlighting this to product teams
- Service / Product Owners: Many companies are starting to structure their operations against their portfolios, i.e., you get teams dedicated to lines of services who are supported by platform teams to:
o Ensure the service/product meets customer requirements and journey experience
o Guarantee accountability for the quality of the service/product and the resultant impact on customer satisfaction/experience
o Lead service/product innovation based on understood customer behavior and the competitive landscape
o Management of the adoption of services/products
- Change Management Leaders: These people need to work with other teams to define the change plan to transition the organization through the transformation. This includes the need to:
o Define, manage, and continually adopt change plan
o Establish the change network
o Manage change resistance
3. Why do many organizations fail to achieve transformation objectives within time and budget?
There can be multiple reasons. The two most popular are:
- Lack of vision and strategic objectives and a single program of work – Not having a clear vision and strategic objectives for your transformation, such as ‘cloud-first’, results in many initiatives being labeled digital transformation to get buy-in. This results in too many non-strategic projects spreading resources too thinly, or it creates so much complexity that the organization completely loses sight of what it is supposed to be achieving for its customers. Organizations should vet all projects carefully and ensure all strategic transformation initiatives fall under a digital transformation program of work
- Immature Project Management – The organization does not perform project management well, often have failed projects, and do not adequately tie projects to strategic drivers
- People Change – People change is not focused on, resulting in significant change resistance and projects failing to take off or land the intended value. Not having a change force that has the digital and technical skills to do the required work is another large inhibitor to success
4. What are the skill shortages to meet the demands of increasing transformation needs?
It depends on the transformation itself, as well as where your company is in terms of its journey. But generally, the below list is a high-level view of the most common:
Example of Management Skills:
- People change management
- Leadership through change
- Coaching and mentoring
Example Technical skills:
- General cloud management and administration
- Data Scientists
- Machine learning and artificial intelligence
- Basic development technical skills for business users such as low code used in application like Power Platform from Microsoft https://bit.ly/2ZjcHLm)
Kati: Does Digital transformation take into account or even recognize the organizational culture change (human aspect)? What about the relationship between digital transformation and agile?
1) Does Digital transformation take into account or even recognize the organizational culture change (human aspect)?
Organizational culture change is, unfortunately, the most undervalued element to effective digital transformation. It has been recognized as the most important element to succeed, as companies don’t technically transform – their people do. If we are not managing this in a structured, proactive fashion, we are unlikely to support our people effectively across their individual journeys. i.e., what digital skills are they going to need, and how do we ensure they are trained to effectively do their jobs confidently going forward?
2) What relationship is there between digital transformation and agile?
The relationship that exists is straightforward. How we go about achieving it is, however, another story. Things are changing at a pace never experienced before. Competitors are producing new innovative services, products, and features at a rapid rate to retain customers and attract new ones. Customer behaviors are changing at a rapid rate as well. To effectively compete, organizations are needing to ensure they can implement new technologies, new ways of working for employees, and changes or other new processes and partners at a much faster rate. In short, companies need to be extremely flexible and agile in how they operate daily.
How does this get achieved, and to what level do you need to be agile (fully or only a few departments)? This is where it gets difficult. What does it mean for a company to be fully agile? Are our financial approaches agile, i.e., yearly budget review vs. funding a product portfolio backlog? Is your strategy agile i.e., is it planned annually vs. monthly? Does your PMO use agile methods or one single form of waterfall project management?
To be truly agile, you would need to consider an entire organizational redesign. Can your product teams be agile when their funds are provided once a year? To know how agile you really need to be and the extent to which you need to adopt new agile ways of working, you would need to examine your industry and your competitive landscape. For most, starting the journey with a few key customers impacting divisions and improving customer lead time will be a significant step in the right direction.
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Richard de Kock
With over 17 years of experience in the Service Management industry, Richard currently works for Microsoft where he has been assisting organizations in modernizing their cloud strategies, operating models, and cloud capabilities.
Across the tenure of his career, Richard has engaged organizations of all sizes across the globe in a variety of industry verticals to resolve complex strategic and operational challenges using a multitude of frameworks and standards.
Richard is an award-winning consultant who holds a Master of Science degree in Service Management from Northampton University in England and specialized in digital transformation practices and capabilities. Richard is currently authoring the ITIL 4 Digital & IT Strategy book and has co-authored VeriSM: Unwrapped and Applied released in 2018.
As a business executive and consultant, David Cannon has led and contributed to digital transformation initiatives of various scopes and sizes across several organizations. He specializes in defining and implementing strategies in a challenging digital world, from IT back-office to front-line business processes.
He has seen what happens when strategies work and when they don’t, and brings the benefits of these lessons to his writing and consulting work.
Over the years, David has used ITIL as a practitioner, consultant, and business executive in companies that include Hewlett-Packard, BMC Software, and Forrester. He is also the lead editor of the ITIL® 4 Digital and IT Strategy book, as well as the co-author of the ITIL® v3 Service Operation book in 2007 and the ITIL® v3 Service Strategy book in 2011.