Digital transformation is not necessarily what you think it is. Here are 9 tips on how to approach what it REALLY is.
Digital transformation might be somewhat of a buzz word, sure. It is nevertheless crucial in your efforts to stay competitive and efficient, and it will become ever more important in the years ahead. Sadly, the notion of what is actually IS differs vastly from person to person and company to company.
See, digital transformation is not necessarily what you think. It’s not about going paperless. It’s not about switching from local storage to cloud storage solutions. It’s not about data encryption, making sure your employees have the right updated hardware at hand, or even creating digital interaction points for your clients and customers.
It's a lot more holistic than that.
Digital transformation refers to the comprehensive and strategic integration of digital technologies, processes, and capabilities across all aspects of your organization to fundamentally change how it operates and delivers value to its stakeholders. It involves a profound shift in your business models, processes and organizational culture to harness the potential of technology, data, and innovation for improved efficiency, customer experience, and competitive advantage.
It's a lot, and how to approach the journey can be stressful and comprehensive for even the most seasoned and tech-savvy managers.
In our field, #supplychainmanagement , a lack of in-depth understanding of what the real issues are and how to fix them through digital initiatives has a real-world impact on both internal resource spending and external sustainability (making everything less environmentally friendly).
That’s why we have put together a list of “remembers” and tips on how to best roll up your sleeves and prepare yourself for the mammoth task of digitally transforming your business for the future:
Digital transformation is not something you can jump into, nor simply jumpstart. Explore the current digital transformation landscape, map trends and try to analyze how different parts of it will be significant for your business. Learn key terms and concepts by heart, and try to map out where these terms and concept might fit in, add to or replace your current business operations.
You might be the top dog at your company, but no person is an island. It’s very important to include other key people, whether they’re C-level or fill other roles, before the journey even starts. A truly effective digital transformation process requires all hands on deck, and you need to emphasize and explain how their visible support and endorsement can encourage employees to embrace coming changes.
Few transformations are as scary as digital ones. Some might feel threatened. Some might feel lost. Some might feel overlooked. It’s important to put people first at every instance and focus on change management before implementing anything. You need to recognize that people are at the heart of transformation. Implement robust change management strategies to address resistance, ensure buy-in, and support employees through the changes. Talk to people one-to-one.
Give them the resources they need to tackle change, and have a contingency plan in case people are struggling in any way. A contingency plan might include elements like ad hoc meetings and dialogue, short notice training sessions, rapid organizational changes to boost empowerment, incentives, external consultancy or a reshuffling of original KPIs. Those things can be costly and time-consuming if they’re unplanned for and taken into consideration from day one.
Risk management is a vital part of digital transformation processes, and though it can be done in numerous ways, some elements and actions are more important than others, wherecConducting a comprehensive risk assessment to identify potential risks and their impact on your organization is the most important. you need to map out and consider technological, operational, financial, legal, and strategic risks before you even start. We also recommend to have due diligence requirements in place for any external partners and suppliers, and to develop a "risk register" containing all identified risks, their potential impact, likelihood, and mitigation strategies.
Such a document will serve as a central reference for risk management. The accumulated data in it can also greatly benefit other aspects of your daily operations, and can be especially beneficial for supply chain management optimization.
Stress the need for collaboration among different departments and teams. Provide examples of successful organizations that broke down silos to achieve digital transformation goals. The nature of digital transformation is rapidly changing, and your ability to pivot from your initial long-term strategies is hinging on bridging silos. Or dismantling silos, if so needed.
Ensure that whatever strategic decisions you make are data driven. As a manager, you should leverage data analytics to gain insights and drive informed strategies. Gather as many data points about you, your organization, market trends and future predictions. It’s very important not to forget “soft” data points either; align yourself with HR to ensure you know exactly how prepared your employees are for coming change, what their mindsets are and what’s needed to make sure that long-term visions are compatible with everyday operations.
For any digital transformation process to be effective, you need to be prepared to change whatever policies you have for the adoption of agile and flexible policies that can adapt to rapidly evolving technologies. If you’re reading this article, you’re not the first to embark on this journey, so read up on case studies of companies that adjusted policies to accommodate changing digital landscapes, and keep those success stories in mind at all times.
You and your employees are probably very skilled and good at what you do. But there is no such thing as perpetual digital literacy. Digital transformation processes require continuous boosting and training, and you need to make sure that the importance of digital literacy is understood and emphasized across all levels of your organization. There are numerous ways to approach this. Check out our post on How to improve your digital literacy here!
Digital transformation processes can be risky, and cyber security and risk management should be high on your management team’s agenda. It is not enough to tell your management team to stay safe; you need to ally yourself with your IT team to ensure that they have the tools and methods they need. At the same time, it’s super important to keep track of relevant metrics and key performance indicators (KPIs) be able to micro adjust process goals as your digital journey continues.
The list of important metrics and KPIs is extensive and the subject of a whole article in itself, but should include key points like process efficiency, resource utilization, ROI and cost savings, in addition to CSAT and CES if the digitization process directly affects clients and customers.
Remember that a digital transformation process is a continuous journey, with a delicate balance between short-term costs and long-term benefits. It can’t have an expiration date or be cyclic. That’s why having the right iterative tools at hand is crucial throughout the journey.
That’s what we offer in the supply chain management realm. Our I-SPIR and I-MAT solutions ensure user empowerment, quality assured data and true digitization of SCM processes and inventory- and material management with immediate results. Check them out here.
#digitaltransformation #supplychain #software #changemanagement
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