Digital transformation (DT) is more than a fad, it is a business necessity. It is easy to stick with what you have been doing in the near term. Since most companies have not implemented DT, the competitive landscape will be static. This masks the threat of not developing plans and implementing DT over the long term.
Why Digital Transformation?
Since the rise of the internet, people have envisioned a state of operations that, until recently, technology and culture could not support. In his book “Business @ the Speed of Thought” (1999), Bill Gates envisions a business operation wholly built around the capabilities of technology. This was the early idea of digital transformation, though not called that.
Implemented correctly, DT is built from the ground up, leveraging internet & telecom technology to fully ‘digitize’ a business process. Some of the technology is relatively newly available (5G for instance); other tech has been around for decades.
With DT, companies can become much more efficient and provide customers and employees with a much better experience.
So, why DT now?
While some new technology is available, DT could have been implemented widely sooner than now. The change is more cultural than technical.
For years we just tried to make the old processes go faster.
Consider collecting information via forms. When companies first considered applying technology to forms, the answer was to scan it into a PDF and email it; the recipient printed it, filled it out, scanned it, and emailed it back.
The next evolution was to use document services that allowed the user to fill out the PDF online. But, it was the same form, designed for printed use, and not very legible on a computer, and not at all usable on a mobile device, just as our use of mobile devices exploded. The final product (the form) was still stored as a PDF, or printed, with limited utility beyond the finite purpose of collecting information.
This is the quintessential example of “paving the cow path.” Rather than deciding if the path is going in the right direction, the goal is simply to make the path as smooth as possible (and go wherever the cows used to go.)
As consumers, we have seen how much easier technology can make our lives. It is manifested in everything from household automation to apps that help us stay in touch with friends and family to transacting with retailers. But, it is only recently that we’ve gone to work and started asking, “why not here too?”
Aside from our personal interactions with technology, business pressures have become more acute. Staffing shortages, decentralization organizations, regulations, and profit squeezes force executives to reimagine how business is conducted.
The overused trope of “a perfect storm” is applicable. Personal experience, business pressures, and the state of technology have come together to make digital transformation practical and necessary.
Short-Term Challenge to Digital Transformation
While inertia is a short threat to digital transformation, impatience is equally detrimental. As Rafael Sweary at Forbes pointed out at the beginning of “The Digital Adoption Gap: Realizing The Promises Of Digital Transformations,” patience is a virtue. Businesses have come to operate in short, quarterly cycles; if we don’t see results in 3 months, we discard projects or reduce resources.
Digital Transformation is new to most organizations. Implementing DT will have fits and starts, small successes, and some failures before the real benefits will be realized. Executives must create long-term plans with cycles that recognize setbacks as a normal part of the growth process. Historically, this has been the toughest cultural challenge to any improvement.