New or updated technology enables organizations to transform into a platform-based workplace and to open up new possibilities for growth in value. This form of Digital Transformation doesn’t happen just by itself. Technology might be available, you still need to find ways to learn how to apply them and make them work for you. You might need to develop new skills in your staff in order to benefit from the opportunities. Digital Strategy is the active approach to transform the analog company into a digital organization.
A lot of research has gone into finding what makes transformation and change initiatives successful. These researches and the real-life experiences have created a subgenre in organizational management literature. There is plenty of empirical findings on how organizations and people deal with change. There is also a lot of ideology and wishful thinking when it comes to subjects like transformation leadership and change initiatives. When I consider leadership in transformations I bring down into two areas: governance on the more technical side and commitment on the human side.
Governance refers to the formalized accountabilities in functions and roles and the decision-making procedures within the organization. In most organizations there is a board of directors or executive committee that is accountable for the organizations performance and operations. They have the final say in setting the strategy and they have a role to play in the process. Often organizations have some kind of planning and control cycle where plans are made, budgets allocated and initiatives are monitored and evaluated. Any strategy to accomplish some kind of digital transformation has to take governance into account and work within the constraints of the organization.
The fact that a CEO or director has to approve the plans and strategy does not mean that the CEO alone can decide that the transformation into a digital organization will happen. First, these initiatives are often quite complex and far-reaching and thus difficult for one person to oversee. Second, digital transformations will effect all staff, partners, customers and others involved. If they are not in one way or another committed to make the transformation a success, it will not happen. It might take more time and energy to get most of them committed to the goals and strategy, in the end it will be more effective. Because when they see the benefits and are personnaly invested they will make the initiative stronger and can work more autonomous without needing direct supervision.
When the governance of the organization is not addressed in the digital strategy, it will fail. When the commitment of the people within and around the organization is not addressed in the digital strategy, it will fail also. Both aspects are needed to make digital transformation initiatives a success.
Executing the digital strategy often means finding one or more technology partners within or outside the organization to provide the necessary digital services. Sometimes specific technology has to be developed to fullfill the needs of the organization (make). Many other times It comes down to procuring services and tweaking it to fit the needs (buy). This is not a static process, coming to an end after contracting the required provider, but a continous and dynamic process to keep on developing or procuring services supporting the digital transformation.
Waterfall or agile, a strategy needs to be executed. In some circumstances the top-down waterfall approach can be successful, when there is strong commitment from higher management and the organization is already mature to work in this way. The agile approach requires management buy-in as well as high attention on people skills and behavior. It fits better with an highly committed workforce and when the objectives are clear to all involved. In all cases there will be a constant adjusting of projects and activities dealing with changes in context and in energy.
Improving and Optimizing
When the program to execute the digital strategy has run its course, the dynamics of constant change, embedding new technologies and learning new skills will not stop. Continual improvement will be the new modus operandi of organizational management. This will come down to improving services providing value for the customers and optimizing the internal workings to become more efficient and effective.