How Your Company can Find Success
The term “digital transformation” is not going away anytime soon. You can either embrace it or fall by the wayside.
While many organizations have undergone digital change, some haven’t found much success. McKinsey conducted a survey on digital transformation and found that “more than eight in ten respondents say their organizations have undertaken efforts in the past five years.” However, success rates are significantly low.
Generally, organizations that have higher success rates than others are regularly implementing modernized technologies such as artificial intelligence (AI), Internet of Things (IoT), big data, and more. But there’s more to achieving digital transformation than having fancy technologies set in place.
The companies that have favorable results attributed their success to 21 best practices. These best practices fall into five different categories: “leadership, capability building, empowering workers, upgrading tools, and communication.” This gives other companies a better roadmap to follow to start reaping the benefits of their efforts.
McKinsey explored each of the five categories that define the necessary steps businesses can take to succeed in the digital transformation:
The success of any organization starts at the top. That’s why it’s crucial for companies to hire the right talent to meet the needs of digital transformation. According to McKinsey’s research, “nearly 70 percent of all respondents say their organizations’ top teams changed during the transformation.” This is probably because management teams are hiring people who are knowledgeable about digital technologies. Furthermore, when leadership is committed and involved in digital transformation, chances of success are higher.
2. Capability Building
To build people’s capabilities within a company, giving their job roles a makeover is a good place to start. This can help the organization achieve its digital transformation goals, giving people a better idea of what the organization really needs to succeed. According to the survey, “respondents are 1.5 times more likely to report a successful digital transformation when this practice is in place.” Furthermore, when it comes to filling the gap between the traditional and digital aspects of business, McKinsey says that integrators and technology-innovation managers “help foster stronger internal capabilities among colleagues.”
3. Empowering Workers
Previous research conducted by McKinsey has shown that successful digital transformations involve cultural and behavioral changes. But how are companies sparking excitement within their employees about these changes? One way is establishing new ways of working, like creating an open work environment for example. Another way is allowing employees to decide how to implement digitization, or engaging people in top positions to reinforce change by encouraging everyone to challenge the status quo. Lastly, “people in key roles ensuring that their own units are collaborating with others when working on transformations” is part of the recipe for success.
4. Upgrading Tools
In order to achieve any success in digital transformation, modernizing tools within an organization is an absolute must. For one, the use of digital tools within an organization makes information more easily accessible. Another contributor to success is when digital self-serve technologies are available to employees and business partners. Also, when it comes to company operations, staying up to date with new technologies is beneficial.
Communication is key to the success of any organization, especially in the midst of transformation. The survey indicates that success is greater when organizational changes are communicated to employees. This ensures that everyone is on the same page. Moreover, senior leaders should be “fostering a sense of urgency for making the transformation’s changes within their units, a practice where good communication is central.”
Find out how your business can also succeed in Digital Transformation.