October 8, 2018
As technology increasingly makes inroads into operations, the business landscape is getting more competitive, putting forward a need for digital transformation, to realize the capabilities of new technologies. The primary purpose of digital transformation is to strengthen existing technological setup by utilizing modern technologies and cloud-based efficiencies. It gives you a stronger enterprise architecture and ensures that you have the right technological effectiveness as needed by your organization.
It helps your organization in more than one simple way. It is aimed to redefine how your business processes function by simplifying the operations and facilitating data-driven decisions. It also helps improve collaboration and convey a common business objective across the organization.
However, the digital transformation journey isn’t a cakewalk. There are certain strong roadblocks during the course. In this blog, we identify the major roadblocks, and how they can impact the transformation journey, and how you can address them.
How often businesses begin to transform without clear goals in mind can actually surprise you. Transformation isn’t all about implementing new technologies and tools and changing the way how your business operates. Lack of clear expectations from the transformation and the vision for how to achieve them can be detrimental to the entire strategic planning and cost significantly.
Vision helps you in understanding the digital needs of your business and customers. It also helps you in scoping the transformation and realizing what kind of resources and investment it would take.
While the change is inevitable, resistance is only natural. During the transformation phase, one of the biggest challenges you may face is the reluctance from your employees. The reason for this is that they’re comfortable in their routine and anything that breaks that routine may bring along a lot of uncertainties.
Since the digital transformation is a considerably big change, the strength of the uncertainties may increase. Your employees may get little worried and to some extent – threatened.
It’s advisable to be with them and keep them motivated during the course of change. It’s nearly impossible to prevent the doubts from seeping in or eliminate all the traces of anxiety. That’s why it’ll help to keep them more informed and involved. Develop the culture of transparency. Tell them why change is necessary to keep up with the changing landscape and how this change is going to benefit the business as well as them.
Of course, like other steps in the transformation process, this will also require a careful preparation.
If you’re revamping your enterprise architecture, you’ll have to make sure it’s for the enterprise as a whole. Often organizations lack the right vision. Thus, their digital transformation strategy is limited, covering only certain sub-entities and failing to cover the entire organization.
Set an objective and create a vision for how you want to drive the process. Think about the comprehensive benefits that the transformation is expected to bring. It should be able to cover all the stakeholders and departments. It should have a clear value proposition for all of them.
You can always begin to craft the strategy around the most important stakeholders of your business i.e. your customer since they’re the ones whose interest should be at the core of your strategy.
Legacy structure of your organization can be a strong hindrance in the direction of digital transformation. Since the process will be expected to bring out multiple challenges in various aspects of your business including roles, responsibilities, reporting, architecture, strategies etc., you may have to deal with more than employee reluctance.
For example, the legacy infrastructure may not be equipped with the right capabilities to work with the new technologies. Or possibly your enterprise works on old principles, with several silos working without a platform for collaboration.
Give this consideration the due attention in transformation planning. Find out ways how you can upgrade the current technology infrastructure. Define the possible challenges arising out of the change in the legacy model and how you would be solving them. It will require you to bring all the departments to come and work together in order for the transformation to be the desired success.
The IT department has a crucial role to play in digital transformation. Their primary responsibilities focus on maintaining enterprise systems and improving them to ensure sustainable functioning.
A step towards digital transformation process may receive a little resistance from the IT department as they may consider it a deviation from their current priorities. Also, there is a likelihood of communication gap regarding the business objectives associated with the transformation exercise, its scope, and the process. This gap can lead to misunderstanding of priorities and the absence of proper coordination.
To address this, the management should ensure that the IT department is on the same page in terms of goals and roadmap pertaining to the transformation strategy.
Digital transformation is not a simple activity. It’s a multi-stage process which can take years to be fully implemented. Each stage requires the right allocation of resources and monetary investment in people, process and infrastructure. Poorly managed budget and insufficient preparation often leave the organizations struggling.
It’s recommended to have a clearly laid-out plan. Set priorities as to what areas of the operations you want to digitize. Prepare an estimate for how much investment each stage will require. Stay prepared to address any variation in the plan.
While the transformation is expected to boost the efficiency of your operations, by no means is it worth unnecessary financial risks. Always run a reality-check on the plan and gain a clear visibility into how much investment you can afford.
The absence of skills to lead the transformation initiative
Transformation is rather a complex process and may put forth a series of technical challenges as you move forward. Each of these challenges can prove to be a potential bottleneck in achieving transformation objectives if you’re not familiar with newer areas of technology. You’ll need to remember that not only does transformation require a meticulous planning but also the right skillset. Lack of talented resources can jeopardize the entire exercise.
Make sure you have all the right resources on your team to carry out the job. Invest in upgrading their skills to ensure they have all the right capabilities to perform their respective responsibilities during the transformation phase. You may also want to consider hiring experienced talent or establishing new partnerships.
The need for scalability
Scalability is an important consideration while planning for digital transformation. The technological landscape is always evolving. Failure to adjust to the changes can negatively affect the efficacy of your transformation exercise in the long run.
Therefore, it’s important to be on top of it to ensure your enterprise architecture is capable of meeting changing demands at a short notice. Make provisions during the transformation phase so that the required adjustment can be made quickly and your enterprise is able to scale as and when needed.
All in all, a comprehensive vision and painstaking planning are bare minimums as you consider digital transformation for your enterprise.