Digital Transformation is dead? Wait…What? We’ve only just started!
Or perhaps you haven’t started! Don’t worry. You might be one of the myriad of Small or Medium sized enterprises that haven’t yet considered public cloud as an alternative to your on-premise technology suite, never mind considered it as part of a wider digital transformation effort.
Perhaps your journey of digital transformation will start soon – though it may have a different moniker by the end of your effort. Those that remember the aspirations of the paperless office remember what might have been digital transformations forbear. Digital transformation comes in many forms depending on your viewpoint – caused by the confusion in the use of the term – and illustrated in the picture below.
The term itself is losing its [marketing] buzz! It’s part of the everyday [IT] vernacular! Its meaning is contorted, twisted and misunderstood, and means many things to many diferent people. Each contortion is valid in its own right, but probably deserves its own term. Perhaps you can remember the plethora of definitions for ‘cloud’ before we settled on what it has now become.
What we do know is that historically 70% of complex transformations fail (McKinsey). 84% of digital transformations fail (Forbes) and 75% of IT projects fails to create adequate ROI (Gartner) according to those initiating them. Or simply, 70% of complex transformations do not achieve their stated goals.
But there is no mention of what these goals are, just binary failure [or success], and the potential causes of it. Even if this is not entirely true, and is different from overall satisfaction with transformation, there is enough truth to make a good baseline from it
The picture below shows the scope of transformation within an organisation. But it’s missing a couple of dimensions
Whilst less important in the context of this post, it will be covered in a future post. This is most simply put as Save Money, Grow Money, Make New Money by Roland Dieser in an interview with Rob Llewellyn.
No one over just fails. You must fail to do something – and that something is not to ‘digitally transform’ – that is not the end goal! What is it that the digital transformation expected to achieve? The only example of this above is the mention of ROI.
The instigating sponsor must set FAST goals for the initiative. Steer away from SMART goals as they are too static in terms of scope and timescale. Discussed in more detail in ‘Are SMART goals really useful‘ . Everyones goals should be transparent and communicated, clearly linked to the strategy of the organisation. Make sure people know what they are going to be doing, how it contributes to the goal, and ideally how it benefits the customers of your business. Developers are turned off by ROI, but they have a definite view on how their organisation is viewed against its competitors.
We move slower than we think we do. We think, on the whole, it will all go well. Optimism bias means that we assume that everything done is done perfectly, initiatives and solutions will;
The best place to look for affirmation that this is not the case is your peers. Ask people in your own industry how long it took them to undertake similar programmes, and how much it cost. Do not be tempted to say, “we can do it better”. You might, but take it as a bonus, not a given!
Rigid goals and timescales also cause these high failure rates. Goals should be adaptive, as markets evolve over the multi-year timescales. A realistic goal in a short timescale is not achievable and will lead to sandbagging, and transformation goals not being ambitious enough. Conversely does a goal that would be achieved in the next quarter after a [arbitrary] time boundary has passed, really mean failure?
One way to reduce the amount of time that initiatives take is to not guarantee them a huge pool of money up front. Ring-fence transformation funding by all means, but that doesn’t mean that each initiative must be funded until it completes. The F in FAST facilitates this. Part of the frequent discussion should be;
If any of the answers indicate that there is risk, then take appropriate action. And that might mean canning the initiative and moving on. At the risk of mixing my metaphors; stop throwing money at dead horses.
If you want help in defining the purpose of your transformation. Determining, measuring and communicating your goals, or perhaps rooting out the dead wood in your IT portfolio. Contact UnlokQ for a discussion.