3 pitfalls that companies should avoid with digital transformation strategies

Since the coronavirus outbreak was declared a global pandemic last year, companies of all shapes and sizes have embarked on digital transformation journeys to meet changing consumer demands and new digital expectations.

However, while some companies have been able to reap huge benefits from their new digital initiatives, most have been frustrated and disappointed with their results. The problems lead many senior executives to abandon their digital transformation efforts entirely. A staggering 78% of companies fail to scale or sustain their digital transformation initiatives as they struggle to derive value from their new business models.

What is digital transformation?

Simply put, digital transformation is the process of integrating digital technology into an organization to establish new business processes or improve existing ones.

Successful strategies should profoundly alter the way a company operates or provides value to its customers, thanks to the opening of new digital channels of communication and customer engagement and the use of technological resources to help improve internal business processes.

According to Statista, direct investments in digital transformation projects are expected to total US $ 7.8 trillion between 2020-2024. However, when you consider that nearly 80% of these projects are likely to fail, this is a lot of wasted investments that could be put to better use.

With that said, let’s take a look at three reasons why enterprise digital transformations are failing.

Lack of strategic perspective on goals, objectives, and digital capabilities.

“Begin with the end in mind.” – Steven Covey.

Believe it or not, even the world’s largest companies make the mistake of embarking on digital transformation journeys without a precise understanding of where the journey will take them.

Unfortunately, this lack of strategic planning and perspective makes many new digital changes sporadic and chaotic rather than well thought out and carefully optimized to deliver the most value to the business and the consumer.

Before starting your digital transformation process, it is essential to know and understand the business objectives, the implementation process, and the strategies necessary to achieve your goals. You also need to understand where and how customer or business value will be enhanced or maintained by replacing traditional models with digital ones.

Replacing your models creates an environment where you can adjust your strategy as you move forward and react and adapt to challenges to achieve your digital goals and targets. Failure to do this will almost always lead to delays, inefficiencies, and ultimately resource depletion.

Not prioritizing organizational culture

Another common reason digital transformation projects fail is lack of ownership of new strategies by employees and management. In many cases, there is often a disconnect between employees and internal teams and responsibility for the success of these projects.

After all, digital transformation is about more than technology. For companies to get the most value from their new initiatives, they must have a workforce that is dedicated to supporting them and willing to make changes in the way they perform their duties.

However, this is not to say that companies should fire and eliminate employees who cannot adopt these technologies or who do not have the right skills immediately. For starters, it is unfeasible to hire new staff every time your company undergoes organizational changes. Second, you will find many more benefits from training your existing staff and making the most of your current human resources.

Employees must also see the benefits of digital transformation and how it will benefit them, the company, or customers. Any organizational change requires transparency, especially when it comes to the adoption of new technologies and culture. Making employees feel more involved encourages them to provide feedback that will help transform the organization.

Not understanding customer needs

Continuing from the first point without a clear vision, digitizing your products, services and business processes does not bring any inherent value. That’s why it’s essential to focus on what your digital transformation journey is trying to achieve and who will benefit from it.

Unfortunately, many companies go through significant technological changes to scale or develop new capabilities, causing them to overextend themselves. This causes them to use large amounts of resources for IT implementations, to a point where their time, capital and human resources are depleted.

The truth is, there is no real use in digitizing your trades just for the sake of it. Instead, you should start with your customers and try to figure out what digital strategies you can implement to better meet their needs and improve the level of value you generate for them.

This could be as simple as opening new channels for digital engagement, such as social media, a website, a podcast, or a live web chat. Or it could be something more sophisticated, like developing a new digital product or service.

Ask your customers what future changes they want in the service or product offered by your company and try to assess which features of your product or service are not worth keeping and which could be improved with digital technology.

Bottom line

At its core, digital transformation is about finding new ways to better serve your customers. These days, customer expectations are changing faster than ever, so businesses must use available digital technologies and resources to meet these new demands.

With that said, companies need to make sure they avoid making these three common mistakes if they have any chance of success in digital transformation.

Image credit: provided by the author; Thanks!

Evan morris

Known for his boundless energy and enthusiasm. Evan works as a freelance network analyst, an avid blogger, particularly on technology, cybersecurity, and future threats that can compromise sensitive data. With vast experience in ethical hacking, Evan has been able to express his views in an articulate way.


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