Digital Transformation : the key success factors

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McKinsey recently issued a series of articles on enterprise digitization? As usual many regret that they say nothing we already know but the McKinsey signature makes it easier to bring the matter to one’s boss without looking like a fool. However, there are a couple of things that deserve to be repeated again and again.

One of the most interesting article is titled “The seven habits of highly effective digital enterprises”

The first thing we learn is that businesses should be unreasonably aspiration. What made me reflect a lot. On the one hand I’m convinced that if you aim for the moon you may hit a star even in case of failure. So yes : be aspirational. But what I’m not comfortable with is how to translate the ambition.

Beware of a digital aspiration employees don’t find realistic

An aspiration that’s not shared with all employees is an aspiration that doesn’t exist. But when one starts from far, the gap between the goal and the starting line is so big that employees may not find the ambition realistic, what leads to the opposite of what’s expected. Disbelief and disengagement. I recently had the example of two large companies admitting that there won’t be any digital Big Bang but a series of small steps. Too many lines of business, of type of employees to promise the moon. In my opinion it’s realistic when we know to what extent companies overestimate they change capabilities unless the announcement comes with a big change. The article mentions Netflix and Burberry…that speaks for itself.

Burberry’s digital success story has been lead by a a new CEO, Angela Ahrendt, who was able to embody the change. With an unchanged leadership team, a unreasonable aspiration often becomes laughable. As for Netflix, it’s a digital pure player, what should make us remind the title of the article : it’s not about digital transformation but digital effectiveness. It’s easy to understand why pure players are digital by nature, by their DNA while others have to transform, something a lot fail at.

So aspiration is ok but one should beware of not falling into a “bullshit positivism” that may backfire.

Then comes some points on talent management. The first is about the need to acquire new capabilities, know-hows and the fact that the right people won’t always be found in the positions we expect them to be and in the same industry. Businesses should not be afraid of looking for them “elsewhere”. As a matter of fact the habit of hiring clones doesn’t help to change one’s DNA. That said, capabilities issues won’t be solved by hiring new profiles only. It’s also about organizational capabilities that won’t emerge by luck. Even the best talent will underperform if put in an irrelevant context. A lose-lose game that leads to disengagement and resignation.

Digital requires a new may to manage talents

The second point is that the talents in question need their own way of working, their own tools, to be taken care of differently. There’s no doubt about it. Some businesses even decided to protect and promotes their “wild ducks”, those who think differently, challenge the existing and who are often required to fit in the mould. What is by the way the last habit mentioned in the article : question everything, challenge everything.

Let me also add that the wild ducks that make businesses move forward are often customers and unusual requests businesses often try to reframe to make them look like things they master and are comfortable with instead to making the most of them to change and invent things. What is well shown in this video.

In the end the last three points are the most significant ones because too many businesses still have a “soft” vision of digital. A matter they love being scared by but does not lead to deep and real change.

No decision without data

First, the need to be “data-driven”, back management and decisions with data, objective, tangible and factual things. Many love to see digital as interactions, not from this more disturbing standpoint. If one need to try, measure, fail fast to quickly pivot it’s impossible to wait for a consensus to emerge. In this perspective the value of conversations and collective intelligence has  certainly been overestimated : tomorrow with cognitive computing and analytics data will come back in force. Humanized data because coming from an analysis of unstructured content and interaction, produced by humans, based on their feelings and natural language processing, data that don’t replace human-made decision but make it more effective, objective, but  that will help to get rid of grey zones many people love because it leaves room for biases and arbitrary decisions.

Then “follow the money”, what means don’t focus only on the customer dimension but transform the whole back office to make the most of the new possible ways of working. Here again, it means going against the trend that prioritizes actions which impact are the most visible without questioning alignment, the symmetry between customers and employees. It’s not about transforming a function but a value flow.

Last is “being obsessed with the customer”. Nothing new but, in many large organizations, what I call the “customer zone of impact” is so far from employees that they can’t understand how they contribute to customer experience.