About digital transformation and process digitisation
When people talk about digital transformation, they usually refer to companies that have analog processes and interactions (e.g. banks that have physical branches).
So to bring digital transformation to my company, do I just digitise my processes and customer interactions?
That's a strong statement, mate. A strong statement.
When you digitise a process, you:
- Trace a systemic view of the process and the agents involved
- Study various tools that enable the new digital interaction, either internally or with customers until you find the one that has all the functionalities you need
- Translate the process to the digital environment, dealing with various adjustments along the way
- Adapt all the processes that have an interface with the one you just digitised
- Communicate/align/convince the people who will change their habits to the digital (depending on the level of user-centricity)
Not to mention the data that is (hopefully) collected and the decisions that this allows you to make.
Quite a lot, isn't it? Can you see that this is something much more systemic than it seems? So, let's answer a fundamental question: what is digital transformation?
In a global McKinsey survey in 2018 on digital transformation, more than 8 out of 10 respondents said their companies had efforts in the area in the last 5 years [1].
The problem is that "digital transformation" has become a buzzword to describe the process of turning legacy companies into digitally native ones, but this doesn't always translate the concept of "transformation" as a whole, which is the crucial element for success.
So what is digital transformation?
Digital transformation is a strategically planned organisational change that empowers teams with new methods to create highly responsive and adaptable strategies for the new context
Phew. Now we can move on. Next topic: how to bring digital transformation to a large company?
Have you ever thought about how much money is invested in digital initiatives worldwide? According to Harvard Business Review [2], in 2018 US$ 1.3 trillion were invested.
The fact is that a good part of this money goes to projects that won't work. More precisely 70%, according to the same article.
That's over US$ 900 billion in misused funds. For reference, that's (at the time this article was written):
- Half the Brazilian GDP
- 8 times the net worth of Jeff Bezos
- 70% of Apple's value
Then, the golden question:
How do I get to be among the 30% that succeed?
A holistic approach is essential for an effective solution. Aligning strategy and initiatives is essential to ensure that each project is part of a bigger goal and is aligned with other initiatives in the company.
It sounds simple in theory, but the day-to-day challenges are many. Let's go through some tactics that will help you reduce uncertainties and think more holistically:
1. Understand the company's motivations behind the projects
Ideally, digital initiatives are an extension of the company's broader strategy. However, having an accessible and meticulously unfolded strategy is a challenging task when we look at a big company's context.
At the same time, many clients come to me with a solution to be put into practice. The willingness to make things happen is exciting, but often the target still needs to be calibrated.
It's important to always ground an idea in a user's pain, so we ensure the idea has a customer basis and we know who to look for to understand what they would like as a solution.
On the other hand, it's no use bringing an idea to practice that is not aligned with the company.
With this, to achieve the balance between user-centricity and corporate pragmatism, comes the BUS → Business, User, Solution framework [3].
The idea is relatively simple:
- A solution is dependent on a user problem to be effective. Otherwise, the project will stall, constantly changing scope and value proposition while trying to find a fit with a target audience.
- The problem of a group of users, in turn, is dependent on a business problem to support it. Otherwise, the project will not have durability within the company.
By tracing a dependency relationship between the solution, the user's problem, and the business problem, you have a holistic view of the project, understanding what motivates it to happen.
2. Focus on pilot projects
Sometimes, all a company needs to get buy-in for an idea is a small win. Something tangible that makes them believe it can work.
Pilot projects can help solve this dilemma. Not every pilot project will be successful, but they will all help understand the approach that works for you and gain the company's support to ensure more budget and continue the project.
To get a pilot project off the ground, a tip: reduce the scope to what is truly essential.
Minimum Viable Products are the simplest versions of products that can be launched with a minimum amount of effort and development.
By applying the MVP filter to a scope, we ensure that what remains is essential for building the product.
# 3. Empower people to work in new ways
Digital transformation requires cultural and behavioural changes. Active collaboration, user-centricity, and calculated risk-taking are some examples.
The best way to develop these capabilities is in practice.
By doing everything hand-in-hand, we not only deliver something highly aligned with the expectations of each project, but we also plant a seed in each participant. When they return to their companies, each one becomes a standard-bearer of contemporary methodologies.
I hope this has helped to bring clarity to what digital transformation is, its impacts on large companies, and how to be part of the 30% that will be successful on their journey.
Until next time.
References
[1] https://www.mckinsey.com/business-functions/organization/our-insights/unlocking-success-in-digital-transformations
[2] https://hbr.org/2019/03/digital-transformation-is-not-about-technology
[3] https://uxplanet.org/the-bus-product-design-framework-4e9fb6f81bcf?gi=ca70b8fbcf68