The pace of change is increasing day after day and it sometimes feels difficult to cope with all the new innovations and trends that you can read about. I believe that everything that can be digitized will become digital. This is a fact that companies have to live with and prepare for. It is hence critical for any company to define a clear strategy for the digital era. When defining the strategy of your company, the digital element of that strategy is most likely increasing year after year. What should you do about this? Most likely if you haven’t already done you will initiate a digital transformation project that will allow to keep up with competition or even better take the lead in the digital economy. The problem is that many companies engage in this transformation by doing some fatal mistakes, here I will list 8 of them that you will probably recognize. Big parts of this article are inspired by a french article I read some time ago, written by Laure Anne Warlin. Credit to her for much of the initial ideas, even though I am sharing here my own views and providing new flavors to the original article.

Denying that the transformation process is dynamic

Corporates often deal with digital transformation projects as a huge one-time monolithic project. The corporate reality in the 21st century though is that our environment is constantly changing and the pace of change is accelerating. In such an environment, you have to constantly transform, you have to break-down that project into multiple projects and constantly revise the objectives and outcomes your strategic plan. For a transformation to be successful you have to constantly consolidate new insights, learn and adapt. Whether it is related to technology trends, consumer behaviors or changes in the business environment, you have to regularly and systematically inject these new insights into your strategy and spur new transformation projects. You have to constantly think about the value you are providing to your customers and challenge the status quo. With the emergence of digitization we have already seen far too many value chains disruption and new business models emerging without the incumbent market leaders reacting properly or at all. It started with apple disrupting the music industry. Nowadays the largest taxi company in the world, Uber, doesn’t own any taxis. The largest accommodation provider in the world, Airbnb, doesn’t own any hotel rooms.

Glorifying startups

There is a myth that startups incarnate an agility and innovation capability that big corporates will never be capable of developing. In the media, corporates are often pictured as big elephants. Moving slowly and with heavy processes that would kill any attempt to innovate before even getting a chance to prove itself. Startups on the other hands are glorified, and there is not a single day where the press is not talking about unicorns. It would seem that missing the startup train is recipe for failure, and startups are the holy Graal for the corporates’ survival. Again, the reality is different. The majority of startups actually fail… and there is big, big difference between a corporate appearing as innovative, which is the perception creating when collaborating with startups, versus actually innovating to transform your company. Building relationships with startups makes sense only if the offerings of these startups can actually be turned into some kind of business value for the corporate that goes beyond CSR and Communications. Far too often incubateurs are setup by corporates, with a primary focus on PR, and very little thought on how these startups’ innovations can be integrated into the offering of the corporate.

Betting your future on a Chief Digital Officer

As the urgency to transform increases a quick fix is usually to assign somebody to the task. The recruitment of a ‘Chief Digital Officer’ (CDO) is often expected to provide that fix. The CDO is expected to guide the digital transformation and lead the company into its digital future. The problem with that approach is that you might end-up create a silo within your organization. Unless the CEO itself is onboard and makes the digital transformation one of his top priorities, there is little room for the CDO to succeed. In fact the CEO has to convey that priority to his entire leadership team and make sure he empowers the CDO across all key functions that will be affected by the digital transformation. Another risk to manage if hiring an external CDO is the culture clash that might occur between a legacy organization, with rigid processes and mindsets, and one of more persons recruited from the outside. If there is too much of a culture clash, it might actually have a negative effect, paralyzing both new and existing initiatives.

Being obsessed with IT

IT is just a tool. But in many organizations, IT spending has increased so much, that IT has become a monster that lives its own life. IT Departments and Chief IT Officer (CIO) have become very powerful. In fact they are given so much power that the business objectives of the company are sometimes forgotten. Of course a lot of the digital competence lies in that part of the organization, but the complexity of the systems in place and the complexity of the integrations, means that it is very difficult to perform change in this type of environment, and the persons in charge, and the CIO in particular are not necessarily interested in weakening their power. It is therefore key to make sure the digital transformation doesn’t resume itself to an IT project or an IT consolidation project.

Blinded by the Bigdata Buzz

Bigdata is often seen as the new oil in an economy that is increasingly turning digital. And Bigdata could indeed provide knowledge, insights, and help companies act faster and better both in order to reduce costs as well as to increase revenues. But the reality is that collecting huge amounts data from social networks, video streams or other sources without having a clear strategy on how to harvest that data can be counter-productive. You have to start putting meaning behind the data, starting with the structured data you already own. You have to put a data strategy in place, that starts exploiting the data you already have. If you approach to business is not data-centric bigdata will not help You have to start improving existing use-cases or new use-cases that can create new value by exploiting the data you have. A good starting point is to start using data to improve the context when serving customers, this can be used to improve user-experience as well as providing more personalized offerings.

Lack of Relevant Key Performance Indicators

How will you measure the success of your digital transformation project? How will you measure the progress of it? It is critical to define Key Performance Indicators (KPI) that are directly linked to your business. In particular, the measures of success should also capture the voice of the customer since ultimately you are doing this transformation to create value to your customers. For that you might want to introduce tools and metrics that allow you to measure Net Promoter Score (NPS) or perform sentiment analysis on social networks. Get your employer closer to customer’s to get a more user-centric approach, train product and development teams in new methodologies like design thinking and agile development. Measures like time spent with customer, number of projects using agile, number of design thinking workshops with customer can be additional metrics.

Not thinking beyond Mobile-First

For a company to stay competitive nowadays you need to constantly revise your strategy and understand how technology and consumer behaviors are evolving. One such trend has been the evolution of consumer behaviors. Consumers use nowadays mobile technology as the main way of interacting with the world. While entreprises have adapted to this change by developing mobile applications not many are thinking beyond that point…Today we are at a point where users do almost everything on their mobile and on their mobile only. What does that mean for service provider offerings? Are web portals become redundant? But then technology is not standing still, with chat bots we will see more and more automation coming and more and more interactions done through messaging platforms. Is that part of your strategy? How about preparing for tomorrow? With the progress done in Natural Language Processing (NLP) and artificial Intelligence (AI), we will see more and more new interfaces appearing which are very different from our phones. Think Amazon Echo or Google Home. Many of today’s mobile applications might simply vanish. You simply cannot stand still and need to constantly fight status quo.

Sidelining HR and Communications

In most companies HR has become a support function, and is not playing a key role anymore in the companies business success. For a successful digital transformation it is key HR is lifted back to take a strategic leadership role in the company. Besides the maybe well understood need to find talent that matches the needs of today, HR has also a role in developing a working environment that builds up a digital culture and a digital DNA. It starts by providing a workplace that gives employees more mobility, space to innovate and tools that are adapted for the tasks at hand. Today the majority of corporate employees believe that the tools and software they use outside work at more efficient that what they are forced to use at work. HR has also a key role to play with the Communications Department to handle the change process and make sure there is a constant alignment between strategy development and employees. HR and Communications have therefore to take a seat in the company’s executive leadership team, ultimately they have to provide the beacons that will help employees develop the afterthought digital culture.

Which of these mistakes have you experienced first hand? If you are working on a digital transformation project, I would like to hear your experiences as well! If you have other views or recommendations, tell us, I am sure we missed out on a thing or two.

If you need help with you strategy or current projects let us know, you can reach me info@innoopolis.com