Six biggest digital transformation mistakes
Updated: Jun 7, 2022
With the COVID-19 pandemic, a few common pitfalls can await companies. Especially those who plan to handle large projects on their own without external expertise and support.
Digitisation, innovation or consumer focus are the main goals of many digital transformation initiatives. While most businesses know they need a digital strategy to be more competitive, many are not yet on the path to success.
Of course, no digital transformation strategy is infallible, and factors for success are so diverse (from company culture to investment capacity) that it is not always possible to control everything. However, it is possible to draw lessons from scenarios that initially hindered the success of digital transformation initiatives.
So, what mistakes should be avoided during digital transformation processes?
1. Seeing digital transformation as a fast thing
Digital transformation is not a slow process, but neither is it about implementing and seeing results the next day. First, implementing changes is always a sensitive process, and then consider existing processes, available services/products, and people.
Digital transformation is the search for improvement by implementing initiatives that may or may not be technological. One way to avoid mistakes is to start with small initiatives (often with a huge business impact) and manage investments and returns wisely with short-, medium- and long-term initiatives. Remember that even big changes start with small steps, and you cannot do everything at once because you will get lost.
Many organisations consider the digital transformation to be an ordinary tech project and once they achieve their goals they’re done. Well, they’re not because it’s an endless journey of keeping up with technology. Digital transformation is not a project that you can complete and then just forget about. Always aim to be innovative for your customers and your organisation itself.
2. Lack of data model schemas
An organisation is made of several departments and, often, each of these departments has a specific way of organising and processing information. Some teams use spreadsheets or email to process data manually, including critical business processes.
Not only does this situation allow data to be easily accessed and shared across the organisation, but it also delays and complicates the decision-making process.
In these cases, data standardisation efforts across departments must be promoted to a consistent structure can be used. This ensures that all systems or applications in the organisation communicate with each other.
Any project can be undermined by failing to make data-informed decisions and skipping a thorough preparation phase. It’s like going right into heavy lifting without warming up. Injuries are almost inevitable. Use, manage and analyse your data collection to take appropriate action.
3. Decision-making processes are not real-time
To speed up decision-making, manual and repetitive processes need to be automated first, then mathematical models can be created for the relevant business processes and algorithms that can automatically accelerate decision-making can be developed.
Another option is to implement real-time communication applications that allow organisational teams to upload data and automatically approve or reject decisions. The goal is for algorithms to automatically trigger decisions, which, for example, can reduce decision-making time from weeks to minutes after team validation.
4. Not having a global view of the organisation
Digital initiatives must be implemented across the entire organisation and supported by the leadership team. Leaders must be motivated, involved and committed to transformation, or initiatives may fail. Leadership teams need to have a clear vision of the goals and strategies to be implemented, as these are elements that will be present during all stages of the digital transformation journey, motivating and inspiring your team to embrace and make the change.
Surprisingly, many organisations know what they want to do, but those directly involved will have a different understanding of why they are doing it. If no one is clear about their role within the digital transformation process, they won’t be as engaged as they should be.
The transformation process often reflects the mindset of the CEO and can occur without any prior discussions with other employees, any brainstorming, any consideration of others' perspectives, and any training. As a result of this, employees are often not engaged, and even top management will lack the commitment to the project. Not to mention, no one will begin to use the new technologies unless they know why the old system was replaced and how to use the new one.
A common mistake is to introduce digital transformation into an organisation with only one board decision. That doesn't work! People need to be trained and immersed in new technologies to start thinking differently. There’s no way you can force this. Talk to your employees, explain things, and involve them in the process to help shift their mindsets towards going digital and to start using the new tools naturally. The technology and the working culture should be in perfect harmony.
5. Insufficient budgeting and planning
Some companies make big plans and then implement them straight away - without detailed budgets or prior verification that their employees have the necessary knowledge and skills. This is exactly how hidden costs pile up in the form of unexpected delays, additional required training, new hires, etc.
Take the time to plan ahead, buffer your budget for each part of the project, and always stay on track. Also, make sure your organisation has what it takes to achieve your goals.
6. Being stuck in the past
It's common to think that if something works just fine, it shouldn’t be changed. This is not necessarily true, because this is a good way to let your competitors outrun you, causing employee dissatisfaction and lost customers.
Don’t get attached to any particular technology. Things change, and so should your company. Replace your legacy systems with modern ones (step by step, of course) or if that's all you need, you might also consider system modernisation. Don’t just keep building on top of old solutions without upgrading.
Digital transformation helps many organisations to be more efficient, significantly improve the customer experience and accelerate innovation to enable them to stay ahead of their competition in ever-changing markets.
To ensure the success of your digital strategy and avoid mistakes or failures, team up with an experienced partner to increase the odds of success. If you are falling into one or more of these traps, whether you are just starting to plan your transition or have already begun, please, contact us so we can help.