“Of all types of disruption, a digital transformation can be the most daunting. Not least because, unlike an organisational restructure or physically moving office, a digital change often comes hand in hand with others. For instance, it could require a refocus on your organisation’s culture – you don’t want to stick digital in the heart of your organisation only for there to be an ‘organ rejection’ because your culture is closed to it.”
Adrian Moorhouse, Founder and Managing Director of Lane4, shares his advice on how to make a success of a digital transformation
Why is a digital change different to other changes?
The word ‘digital’ is ambiguous and has many connotations. Where one person might think of computers, another may associate it with the internet. So rather than dwell on the definition, it’s simpler to look at the two reasons why businesses undergo digital transformations:
> To improve internal processes and reduce friction within an organisation. This could, for example, mean installing a new back-office system
> To use technology to overhaul the business’ product offering, such as when supermarkets implemented online shopping as a core part of their proposition to customers
As mentioned earlier, one unique challenge of digital transformation is that it often requires other changes – like a culture shift. Another is that it brings a whole load of jargon with it. This can lead organisations into a kind of ‘acronym-mania’ where terminology is being thrown around but not everyone shares it. People who understand it will get frustrated that things aren’t moving faster, and those who don’t will feel out of their depth and afraid to ask “stupid” questions. As a leader, it’s your job to support people through what can be a confusing time. You must do more handholding than you might expect, especially if you do understand the jargon as you’ll assume everyone else does too.
Is it even worth it?
When you hear that over 60% of changes fail, and that only 5% of digital transformations meet or exceed expectations, as a leader it can be tempting to think “I’ll just sit this one out.” But digital change gets to the very heart of what keeps a business afloat – relevance. So, what should you bear in mind to make sure you get the transformation right?
Don’t forget that all change is psychological
As Mary Shelley said, “Nothing is so painful to the human mind as a great and sudden change.”
One risk of a back-office change is that you do something that demands a behaviour shift, but that this doesn’t take place. An IT system is only ever as good as the human using it, therefore it is key to not neglect the human side of change: upskilling, FAQs and conversations to understand people’s concerns are all hugely important to a successful digital change.
Don’t get stuck in details: communicate benefits
If, as a leader (and like me), you are not a hugely technical person, there is always a risk that you will become a dragging anchor to any digital transformation. It may sound obvious, but to avoid this, I employ technical people – and trust their knowledge. I then focus my time on boiling the change down to two questions:
> What are the pressure points for people?
> What are the benefits we expect?
By understanding these aspects, you can offer support to your people in the places they need it most, and can present a guiding vision of why you are doing this when times get tough.
Change is scary, but good too
You never really know if any change is going to work. Leaders could introduce a new digital system, or restructure the organisation with the best intentions, but they still wouldn’t actually know if it will make things better. That’s the scary part of change. After Lane4’s last restructure, we saw revenue go down the following year; it wasn’t until 18 months later that we saw the benefits we’d expected. It was tough. But you should not regret taking that risk if you want your company to become a more successful, more sustainable organisation. And to get there you’ll have to adapt.
At the end of the day it’s important to remember that any change is about people, not processes. Bringing your workforce along on the transformation journey, and crucially, engaging them with the change is key to its long-term success. Communicating the benefits of the digital transformation can go a long way in doing this. In today’s highly competitive landscape, leaders must change before they have to. John Lewis is a great example of a company who has done this. They’ve been on a fascinating journey from bricks-and-mortar stores to online shopping hubs. The impressive thing is that they have enhanced their original offering, not destroyed it. So, will 2020 be the year you get ahead of the curve?