Despite challenging times, digital transformation is an area of investment that deserves to remain high on the priority list.
Raconteur shares its insights into best practices for digital transformation, and how to implement these initiatives in a way that succeeds.
In trying times, it’s understandable that many businesses are looking to cut back on their big expenditures, which is precisely why digital transformation investments are increasingly coming under the firing line.
Although it might be tempting to cut out this large, long-term investment – in order to guarantee short-term survival – digital transformation is an area that should continue to be prioritised. By implementing these initiatives, you can continue to build your business’s resilience, and strengthen your procurement processes into the future.
In its recent research, 4 ways to ensure your digital transformation doesn’t fail, the brains at Raconteur share their guidance for businesses looking to take this next investment step.
Although the ROI will be slower, keep the bigger picture in mind.
Anyone who imagines that a transformation will be an overnight success is likely to be in for a big disappointment.
Raconteur explains that the degree of a company’s investment (and its willingness to keep up with these investments) in digital transformation is highly influenced by a keen awareness of a slow ROI.
In fact, in a recent survey by Alida, 39% of high performing companies had a fully integrated digital-physical strategy.
But, in similar research by McKinsey, it was revealed that companies with an engaged CDO are 1.6 times more likely to achieve successful digital transformation.
Naturally, investments in digital transformation won’t bring about visible rewards for some time. But, it’s the companies that enter into this strategy with a clear vision, a united front and a commitment to perseverance that succeed, and see digital transformation be an enabler of new value streams, in and of itself.
“Struggling businesses might understandably be wary of committing precious cash to a transformation. But it’s likely that the benefits will outweigh the initial expense, uncertainty and disruption – eventually.”
Align on this new perspective
Relatively speaking, digital transformation is a new discipline, which opens up entirely new opportunities.
The possibilities that it creates include improving resilience, making decisions faster and more accurately, increasing your agility, more effective scenario planning, and receiving and acting on feedback more efficiently.
But, if companies are unwilling to recognise the importance of this new shift, and unable to adopt a united front, then its success can only go so far.
For instance, McKinsey stated that 70% of digital transformations fail, and one of the most common reasons for this was resistance from employees. In fact, staggeringly, just 16% of employees believe that their company’s digital transformation has enhanced productivity and is sustainable in the long-term.
In order for businesses to utilise these technologies to their full advantage, digital transformation needs to be permanently implemented into the company’s culture, and teams at all levels be convinced of the value of these changes.
Key Takeaways – how should CPOs approach digital transformation?
- Prepare yourself for a slower ROI
- Support your team – with training and change management strategies – as they prepare for the shift
- Ensure your entire team is aligned on your vision
- Commit to digital transformation, and persevere with the investment
- Don’t expect a rapid return on investment
- Look beyond the costs of digital transformation
- Ditch old ways of thinking
- Be prepared to adapt constantly