Developing Your Digital Transformation Strategy. Strategy. Developing Your Digital Transformation

Transcription

1 Developing Your Digital Transformation Strategy V Strategy Developing Your Digital Transformation Strategy Course# Course Title 1

2 Contents Clicking on the titles will take you to the different sections. About the Program I. Introduction II. III. IV. Strategizing for Digital Transformation/Organizational Restructure Your Three Step Guide for Digital Change Management Achieving Buy-In and Engagement V. Key Takeaways About the Author Course# Course Title 2

3 About the Program In this digital age, the pace of change is increasing exponentially and every organization faces existential threats from new and existing competitors. The program is crafted to give everyone within an organization from the C-Suite to the production line an understanding of what digital transformation means within a global context, and guidance to achieve the digital transformation journey in your own organization. We will cover an explanation of what digital transformation involves, the roles and responsibilities around digital transformation, as well as the cultural aspects of a digital change. Over the course of the program we will detail tips and tricks, potential barriers, clues into the ideation approach, and how to move towards seeing digital as an ongoing process. By the end of the program, participants will be fully conversant about digital transformation, and will be armed to be the change agents within their own organization to implement digital broadly. No matter whether you are just beginning the journey of transformation or are well on your way, the guidance in this program will be useful to you. Early adopters, those mid-way on the transformation journey or those yet to begin will all find something of value from this program. Welcome to the future! Course# Course Title 3

4 Course V: Developing Your Digital Transformation Strategy I. Introduction In this course, the rubber begins to meet the road. We ll discuss how to strategize an organizational restructure that will enable transformation. We ll also discuss the different roles and responsibilities of those involved. As with any change process, people and culture is a huge area when it comes to digital transformation. We ll discuss these issues and look at ways to reduce the negative impacts, while increasing the beneficial ones. We ll show how better outcomes can be gained through involving everyone in the transformation process, and how the collective wisdom of all employees can deliver unintended positive consequences. We ll discuss the issues around company governance, and give some guidance to managers and boards who worry about losing control. Finally, we ll look at how digital transformation projects tend to have the effect of democratizing roles and responsibilities within an organization, and we ll provide some insights into how this impacts real-world situations. Course# Course Title 4

5 II. Strategizing for Digital Transformation/Organizational Restructure As we highlighted in previous courses, in order for an organization s digital transformation initiatives to be effective, the process needs to be purposeful. Since digital transformation is a business change rather than a purely technology one, and since digital transformation by definition touches all parts of the organization, digital transformation requires a high degree of change management. In an article 1 reflecting on the change management process, Mark Peacock ( Global Transformation practice leader with strategic consultancy The Hackett Group) said that: For us, digital transformation is really that intersection of technology innovation and business innovation. It s how you re taking digital technologies and as a company really, fundamentally changing the way you re delivering products and services. It s about applying technology innovation to come up with new business models which really drive new revenue above the line and new ways to deliver products and services. The fact of the matter is that digital transformation will fundamentally change an organization s processes and operations. This is especially true as the transformation gains broader traction within an organization. Because of this, it s critical to have a change management plan that covers both the cultural and the technological impacts. Part of this change management plan will include a strategy to help stakeholders change their expectations. In its own forays into digital 2 GE had to encourage this change. Previously, most manufacturing plants had static requirements documentation which set out the specification that were cast in stone. This meant that every facility was, essentially, running a custom process. The GE Digital Services team would take those requirements 1 Olavsrud, T. (2017, August 03). Change management for digital transformation: What s different? Retrieved from 2 Olavsrud, T. (2016, March 16). How GE will bring the Industrial IoT to life. Retrieved from Course# Course Title 5

6 and build solutions based upon them. The reality is, however, that employing best digital practices means that sometimes those developing digital solutions need to help users see the utility of changing the way they work. At the end of the day, stakeholders need to understand that simply doing something because this is the way we ve always done it doesn t really work. We can t overstate how much this change management process is critical. In the GE example, a static approach would mean that as needs changed, the delivered result would potentially not deliver what the business required. Research from McKinsey shows companies that get digital transformation right win market share, and those that don t have a negative ROI for their investments. Since culture is one of the key determinants of successful application of digital, this is a critical area. And given that less than half of decision makers are confident that their organization has the ability to achieve its digital vision 3 spending extra time on this process is a smart investment. Here are three key strategies for how to manage the process. III. Your Three Step Guide for Digital Change Management There are, we believe, three key strategies that leaders and teams should think about as they manage the change around digital transformation. AIM HIGH: INCREMENTAL CHANGE ISN T REAL CHANGE While we have advocated for teams to identify low hanging fruit as they begin their digital transformation process, this doesn t mean that their planning and their aspirations should be similarly constrained. There is, after all, a difference between a project s vision and a project s first steps. Teams and leaders should be bold in their vision for digital transformation. The scope of the process should move far beyond incremental improvements and minor features. The aspiration should be around making large-scale change. Indeed, in something of a self-ful- 3 Executing Digital Transformation. (n.d.). Retrieved from Course# Course Title 6

7 filling prophecy, consultants McKinsey suggest that those who win in the digital transformation space are those who invest more, rather than less, in the process. Obviously there is a balancing act here and sometimes obtaining larger budget is predicated upon success of initial projects, but from a vision perspective, the team should aim high. FOCUS ON HIGH-LEVEL BUY-IN We ve mentioned this before, but to truly achieve velocity and momentum in a digital transformation process, the C-suite and the board need to be part of the journey. While the digital transformation process is a team game, like in any sport, having a captain to muster the troops and fly the flag is critical. A digital transformation team needs a high-level sponsor who can articulate its value and success, shield it from political interference and motivate the troops when pitfalls arise. NURTURE AN ENVIRONMENT THAT VALUES CHANGE Change is hard. Change that fundamentally impacts upon the way people work is even harder. But just because something is hard doesn t mean that it s the wrong thing to do. As with any change management process, showing people the value that change can drive is key. There is, however, a balancing act to be played here. The skills needed to effectively manage and develop digital processes isn t something that everyone inherently has. Leaders need to think deeply about the balance between developing the skills of existing staff versus recruiting new staff who already have the requisite digital skills. Existing staff may rebel against the idea of digital transformation, however, on the flip side, recruiting new staff may result in a disjointed organization. Leaders should develop a dual strategy, one that evangelizes the value of digital to existing staff, but one which is also open to hiring newcomers where appropriate. Course# Course Title 7

8 IV. Achieving Buy-In and Engagement The success or failure of digital transformation initiatives is directly related to achieving buy-in from those who are actually going to be using the systems. As such, identifying the best ways to achieve buy-in, adoption, and engagement early on will be key. Buy-in is a complex area and involves both leaders and those at the grassroots. The goal here is to ensure that strategies used for a digital transformation project tie into high-level desired outcomes and the reality on the ground. As we have pointed out previously, the best way to ensure this is to identify the right stakeholders across an organization. These are the ones who can successfully engage employees and communicate a vision for digital transformation that individuals at all different levels can relate to. Another important aspect of this process is consultation across the organization. While it might feel contrary to the move fast drive for most digital transformation teams, dedicating time to understand of the current state and the current way workflows progress will help to set the scene for transformation efforts. It is always a balancing act here. Henry Ford famously said that if he d asked people what they wanted when designing his first motor car, their answer would have been a faster horse. While it is true that transformation teams should avoid being hamstrung by the current state, designing a new system or process without first understanding a user s needs is arrogant and doomed to fail. GAINING ENGAGEMENT AND ADOPTION Personas and stakeholder stories are a good way to develop a deep understanding of an end user s requirements. The added benefit of this sort of approach is that it also encourages a relationship of trust between end users and the transformation team. Personas are a highly effective tool that can be used to ensure the products and services closely align with what users need and want. Creating personas is also a great way to assess the willingness of end users to experiment, learn, and change the way they work. By undertaking workshops to design personas and canvassing end users views, a digital transformation team can set itself up for ongoing success of its projects. Course# Course Title 8

9 GOVERNANCE FOR DIGITAL TRANSFORMATION A very real tension exists in the world of digital transformation. On the one hand, for digital transformation to be successful, it should be unfettered by the constraints of the current situation free to explore new ways of thinking and working. The reality, however, is that digital transformation does not occur in a vacuum. While the process is occurring, attention still needs to be given to the regulatory and legislative environment within which the organization works. We have previously written about the poor results the BBC historically saw from its digital transformation projects. Much has been written about the governance structure within the BBC and how that failed to deal with the highly complex nature of the project at hand. Digital transformation which often involves a highly complex, fragmented, and distributed range of devices, platforms, and data introduces significant challenges to those tasked with the governance of the organization. Subsequent reports into the poor results that the BBC saw suggested that: Corporate governance bodies did not have clear oversight over the transformation process and the status of projects falling under the purview of the transformation team There was no consistent and coherent plan in place which would manage the various risks related to the transformation, meaning that teams had to deal with issues in an ad-hoc, rather than planned manner It should be obvious to anyone who has worked in organizations with regulatory requirements that any digital project in particular broad digital transformation projects need a well designed and constructed governance process. This helps mitigate as many risks as possible. Undertaking a digital transformation process without governance is akin to setting sail intending to circumnavigate the globe without maps or charts. So what are the key factors for good governance in your digital transformation projects? Luckily, digital transformation doesn t happen in a vacuum. It is highly likely that there are individuals or teams within your organization who are already tasked with governance Course# Course Title 9

10 issues. These people are your first port of call. You need to identify the individuals who are both subject matter experts in the area of governance, and who also have the requisite skills to be helpful partners in the transformation journey. In a focused discussion about Governance for digital transformation, the CIO Executive Council identified ten critical success factors for digital governance 4 : 1. A need for clear digital decision-making roles 2. Transformation should be regarded as both a business and an IT activity; often CIO enables and a CXO leads 3. Transformation should operate at the right pace for your company 4. The funding model recognizes different types of investment, not one-size-fits-all 5. A team that monitors and pulls plug on failing initiatives early should be established 6. Creation of a process that ensures all elements, not just technology, are considered before funding happens 7. Clear communication for the measures of expected value and how it will be counted 8. Business leads should be held accountable for the results 9. Creation of a process that examines actual vs. expected outcomes 10. Creation of a clear exception process 4 Rob Llewellyn. (2016, July 19). Digital Transformation Governance Success Factors. Retrieved from Course# Course Title 10

11 George Westerman, Andrew McAfee and Didier Bonnet published a book 5 looking at the broader issues related to digital. In their book they comment extensively about digital governance. The authors suggest three key areas that should be deeply considered when creating a governance framework for digital transformation. The three areas they identify are: 1. Governance Committees Who will be on it? How often will it meet? What will its terms of reference be? 2. Digital Leadership Roles Skills and attributes, KPIs and resourcing 3. Shared Digital Units Specific projects or shared services, where should the emphasis lie? 5 Westerman, G., Bonnet, D., & McAffee, A. (2014, October 2). Leading Digital Turning Technology into Business Transformation. Retrieved from Course# Course Title 11

12 V. Key takeaways We re in the nuts and bolts part of digital transformation now. The work you do to set things up well now will have a direct bearing on the efficiency and effectiveness of your initiatives. While it might seem like time spent thinking about how to set up a group, liaising with the business, and carefully dealing with the sensitivities of stakeholder is all time NOT spent on actually affecting digital change, these are all critical factors to ensure smooth sailing later in the process. Likewise, while some people might resent having to spend time setting up governance groups and audit processes, a bit of time spent ensuring good process at the outset can save huge amount of time and money later on, not to mention the amount of risk it can remove from the transformation process. There is always a balance, however, and too much time spent thinking about governance can lead to a stalemate which doesn t progress the actual transformation. It is hard to put a quantum on how much governance is enough, but the adage often used in agile circles, that 80% done, is done, is a good touchstone. We cannot stress enough the important of these foundational tasks. A robust and resilient building is only possible when a good foundation is in place. This becomes your organization s foundation for digital transformation. Course# Course Title 12

13 About HelloSign HelloSign is powering the future of intelligent business. The company s software platform which includes esignature, digital workflow and electronic fax solutions converts process to revenue for over 60,000 companies around the world with HelloSign, HelloFax and HelloWorks. About Ben Kepes Ben Kepes is a business leader, a technology evangelist, an entrepreneur, and a commentator. Ben covers the convergence of business and technology. His areas of interest extend to leadership development, startup activity, digital transformation, and enterprise software, as well as articulating technology simply for everyday users. He is a globally recognized subject matter expert with an extensive following across multiple channels. His commentary has been published on Information Week, Computer World, Forbes, Wired, ReadWriteWeb, GigaOm, The Guardian and a wide variety of publications both print and online. Ben s insight into the business of technology, and the technology of business has helped organizations large and small, buy-side and sell-side, to navigate a challenging path to a successful future. Ben is passionate about technology as an enabler and enjoys exploring that theme in various settings. Course# Course Title 13

14 Course V Developing Your Digital Transformation Strategy hellosign.com/digitalstrength Author: Ben Kepes 2018 HelloSign, Inc Let s stay connected! Join the s LinkedIn Group Course# Course Title 14