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Why Digital Transformation isn’t a tech project.

I’ve highlighted innumerable times, there are as many excuses for digital transformation failure as there are failed transformation projects. There is, however, a single cause and that doesn’t change.

Wherever you look and whoever you listen to, despite differing terminology, the message is the same – failure is always the result of a lack of focus.

Who should be running your transformation project?

Nowhere is this more obvious than in the question of who should own a transformation project. This is a very cloudy issue, but it shouldn’t be. Those businesses that are enthusiastic enough about the idea of “digital transformation” to appoint their Chief Technology Officer to manage their process are often shooting themselves in the foot. The last thing you should be doing is putting your techies in charge.

You can’t be too critical of the enthusiasm of these organisations. The problem is it’s misdirected. Their leaders just don’t understand the difference between change and transformation.

Change is the process of automating an existing model and it’s reasonable (although still not necessarily correct) to expect techies to be able to handle this. However transformation – the process of re-engineering your business from the ground up, using today’s digital technology – is is something entirely different.

Transformation projects with technology people in the driving seat almost always fail. The reason for their failure is that the object of the exercise becomes digitisation and that really isn’t the point. It’s a mistake made by so many of the businesses I encounter, so I just want to focus on that for a moment.

Get digital transformation right first time.

Digital transformation isn’t about the technology. This may sound a bit odd, but bear with me.

It is generally accepted that at least 70% of transformations fail. In fact Michael Wade, one of the world’s leading authorities on change and author of nine books on the subject, suggested in a recent interview on Rob Llewellyn’s podcast, that a more accurate figure might be as high as 95%. Personally, I wouldn’t be surprised. However, this isn’t just a failure of a project. It usually represents the failure of the organisation. Few organisations survive beyond this point, for three reasons;

  1. Transformation is very expensive and their “transformation” will have stretched their finances to the limit.
  2. Transformation takes a long time and disrupters will have been converging on the organisation concerned throughout their transformation process. There simply isn’t enough time to start again.
  3. Transformation relies on winning the hearts and minds of a diverse range of stakeholders, which isn’t easy to start with. Few organisations will be able to muster credibility for a second time for a different mission.

If there ever has been, there’s no longer a margin for error. You simply have to get it right first time. The stakes couldn’t be higher.

The reasons disrupters take over a sector are three-fold

  1. They stay on top of customer needs because they can collect and analyse data faster than a traditional business could even imagine.
  2. They deliver a product/solution that EXACTLY meets those needs – design, speed of delivery, simplicity of process etc.
  3. Their proposition is cheaper than a traditional business could ever be.

This all adds up to a far superior customer experience.

You might argue that automation is part of this and you’d be right, but it has to be in context and this context get’s lost when transformation is treated as a technical project. When the tech is the hero you can be pretty sure the organisation has lost sight of the real objective, which should be customer satisfaction.

The ONLY point of digital transformation is to create a better customer experience. One that meets the needs of the 60+% of consumers/customers who are digital natives and, by this definition, both demanding and unforgiving.

Why marketers should drive digital transformation

The people in an organisation who are best-placed to understand what this means are marketers. These are the people within any organisation who own the realationship with the customer, which is why transformation projects led by marketers are the most successful.

Of course, you have to have marketers worthy of the title and I accept this is a problem for many businesses that have devalued the term “marketing” over the decades. Fundamentally marketers are the people who have always aligned switched-on organisations to market opportunities. They are not simply advertising or communication experts. If you’ve fallen into the trap of believing this to be so, you’ll have a bit of prep work to do before you can start your transformation. Once again though, you don’t have a choice, so get on with hiring a Marketing Director.

This prompts me to highlight another point. Whatever, you may believe, if marketing isn’t represented on your board you are lucky to have survived until now. You certainly won’t make it in the digital marketplace, where the relationship with customers/consumers is paramount. Because marketers are the owners of these relationships they drive a contemporary business and therefore need to carry the weight and have the credibility derived from board membership.

Setting transformation objectives

Once you have your marketer in place you can kick-off your transformation process and it all starts by identifying where your business opportunities lie. To do this you need to consider four things:

  1. What consumers/buyers want
  2. How well other organisations are meeting these demands
  3. What gaps/opportunities remain
  4. Which of these are you best-placed to respond to

This much is strategy development #101.

When transformation is tech-driven organisations will build infrastructure against a back-drop of a legacy model or at best without purpose. When you get this right and start by identifying what you are trying to achieve, the strategy briefs the technologists to build an infrastructure specifically to facilitate this.

Logical though this may seem, it has shown to be beyond many organisations. That’s why so many transformations and organisations are failing. In fact, neglecting to make your objective the hero of your organisation – or, as I express it “focus” – is behind every commonly-quoted excuse for transformation failure.

When you don’t have focus you get organisational silos, obstructers, digital ignorants, apathy and more. In fact, the process of sharpening your focus is one of the essential components of a successful transformation strategy.

The often overlooked key to digital transformation

There’s good news though – you already have what’s required to achieve the focus you need. You call it your brand. Few people fully appreciate the purpose of a brand or how central it will be to survival in the digital economy and most need help to manage their brand for either successful transformation or survival in the digital marketplace. However, pretty much all the knowledge you need is published somewhere and you need to start working through it.

Meanwhile though, don’t lose sight of the real point of transformation. It’s not the tech!

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