This is part 2 in a 2-part blog series on Digital Transformation programs. Click here to read part 1.

In 1955, Variety magazine predicted rock and roll would be gone by June of that year. In 1995 Newsweek said that the Internet was just a fad.  In 2007, Microsoft CEO, Steve Ballmer predicted the iPhone would not gain ‘significant market share’. The future is difficult to predict – Perhaps the reason why 57% of the companies on the Fortune 500 during Newsweek’s prediction in 1995, no longer exist today. Unfortunately, many organizations will again be blindsided as they discover just how quickly and how far they fell behind, due to the pace of external change coupled with lack of internal commitment.  Leaders are creating a false sense of confidence about staying up-to-speed with this pace, while inertia maintains the status quo.

This behavior can occur for several reasons.  Perhaps leadership doesn’t fully understand how to embrace these changes.  Maybe they lack support within the business or at senior leadership levels.  They may be in year three of a five-year strategic plan and feel resistant to shift directions. Perhaps they feel that familiarity with the technology itself is more important right now.  They may even believe they have always worked in the forefront of new technology, so why not continue as planned?   It is also common for a near-term revenue decline to “justify” a lack of investment for the future.  To understand if your own digital transformation is driving strategic change,  look for a few indicators:


  • Is disruption a defined outcome?
    Embracing the future of digital is not about testing new technology.  Piloting new tools and technology will always have a place within an innovative organization; however, the digital journey is about application of technology to transform core business, in order to compete in a new age within an existing market or perhaps, a new market.  Are you engaging new customers or entering new markets?  Are you creating new value propositions?  What is the impact on performance, growth, market position, or future services/products?  Have you assessed your readiness for compete successfully in a new way?  Is there a blueprint to strategically leverage digital technologies and progress these concepts over time?  Technology is nice, but a focus on evolving the business for the future is critical.


  • Is the program led by the business?
    Your IT department will certainly act as an enabler and facilitator of the journey.  They will understand, or perhaps acquire the technical talent, various tools, and the latest technologies required for digital change; however, the journey itself is one of business strategy and evolution.  Business leaders, whether in Marketing, Sales, Operations, Services, or perhaps a Chief Digital Officer, are the most vested parties in transforming the business with new products, new market entries, customer engagement, or competitive strategies, and will understand what kind of competitive outcomes are expected as a result of the program. Does the program governance structure have a healthy dose of business oversight and accountability? Is IT using “digital transformation” to push for a change in technology or is the business pushing to change how they compete with new technology?


  • Is data playing a critical role?
    A common theme in meaningful digital transformation is the new use of data and/or the use of new data.  If stakeholders are not asking how to mine new insights, answer new questions, or apply new information in creative or progressive ways, it is unlikely you are building anything significantly new.  The data itself can vary widely by industry.  Perhaps you are incorporating social media information to predict customer behavior and build new platforms.  Perhaps you need more information about equipment performance to launch new forms of safety prediction or equipment failure prevention.  Perhaps if you knew how external events affected demand for your products in real time, you could launch a service that would open an entirely new value stream.  If people are not clamoring for data never used in the past, you will find limited advancement against how you operate and compete today.  Data is no longer simply information about your assets, financials, or performance.  It should fuel the transformation, and the business itself.


  • Is the organization changing to facilitate the transformation?
    Embracing change is an ever-present challenge within business.  At the core, digital transformation represents a fundamental shift in how organizations compete and embrace the changes that will occur with increasing acceleration.  It is not just a project.  It is not just a program.  It is not another annual strategic initiative.  This is about survival in a new competitive world taking shape very rapidly. While the term ‘transformation’ is often overused to describe anything new, it is hard to replace that word as a description of what is required.  Companies do not transform by following a 345 line Gannt chart.  They transform by changing how they think, how they plan, whom they hire, what kind of functions they develop, and what kind of outcomes they strive to achieve.  If the digital transformation program is not talking about people, roles, or functions, it is time to renew focus.


Do not assume your digital transformation program is preparing your business to compete.  Evaluate the real change the program expects to achieve. What impact will it have on the future?  How will it impact your customer interaction?  What do you expect your business to look like at the end of the digital journey?  If it resembles your business today, it is time to re-evaluate the program.  Whether your threat comes from a start-up or a global competitor moving rapidly, the digital transformation program is your platform to drive business and technology innovation for survival.  If planning for this shift in strategic thinking is not on your radar right now, take advantage of this quickly diminishing period to plan for the scale of rapid business change your program will need, in order to make up ground as quickly as possible. Much like the Internet in 1995, this fad is not showing signs of disappearing anytime soon.


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