Is your business digitally liberated or are you struggling to keep up with the pace of change? Here we look at some of the challenges of digital transformation and suggest ways around some of the roadblocks that you may encounter.
It seems hardly a week goes by without the launch of a new social channel, a new way of watching TV, or a new IoT app that lets us do something we'd never even thought of doing before. The resulting immediate changes in consumer behaviour tend to be accompanied by the rapid emergence of new business competitors and disruptive business models. In some markets, the sheer pace of change outstrips the ability of businesses to respond. Larger organisations, and those that have been around for a while, are often at particular risk, as newer, more agile competitors identify and exploit market niches, and collaborate to form interconnected ecosystems at a much faster pace.
To increase their chances of riding the wave of rapid change, established businesses often embark on a digital transformation programme. But, sometimes, there's too much focus on the new technology, such as a content management system, at the expense of the bigger picture.
The technology that gets implemented may work as a sticking plaster to solve a problem today. But it takes more than just technology to transform a business into a digitally liberated one, able to keep on responding to changes and disruptions, including those that can't be foreseen. To achieve true digital freedom, an organisation needs to do more than increase its technical capability. It also needs to ensure that the technology is adopted, and that its business model is transformed at the same time.
How far have you got on your journey?
In my experience, organisations that have started their journey to digital freedom tend to fall into three categories — formative, radical or cautious — depending on the technical capabilities they've implemented, how well they've been adopted within their organisation, and how connected their business model is across consumer touchpoint.
If your organisation has just begun its transformation journey, or you're at a point where it's become a real struggle but you know you'll soon see real benefits if you don't give up, the following sections should provide you with insight into the roadblocks you may have encountered, along with some guidance on how to overcome them.
Formative organisations: just out of the blocks
These are brands or businesses which are at the start of their journey to digital transformation, or whose transformation has stalled at an early stage. With limited technical capability and low rates of adoption within the organisation, digital freedom will be quite restricted.
If they have a legacy platform, it may not offer all the technical features they need. Even if the platform is cutting edge, problems with its implementation may mean that the organisation doesn't have the right components to deliver the right experiences, or that components can't easily be re-used across multiple sites. It may simply mean that the system is difficult to use.
Low rates of adoption within a brand or business often stem from a lack of organisational buy-in to digital transformation — perhaps senior management doesn't consider digital to be a priority, or there hasn't been enough investment in resources and skills to make digital effective. Even with buy-in, if digital hasn't been integrated into business processes, it will be nothing more than a sideshow. And if governance processes haven't been adapted for the digital world, quality and agility will be lacking.
To become digitally free, formative organisations need to map out their path to success. The starting point is getting senior-level buy-in to the digital vision, and developing a ground-up assessment of how to achieve it, through a programme of incremental change.
Radical organisations: technology wizards
These organisations were quick to see the value of digital and have aggressively embraced it by investing in technology. In these organisations, digital transformation is often driven by IT. The problem is their vision is frequently so far ahead of the rest of the organisation that it's impossible to bring everyone else along with them. Even if a lot of effort was put into choosing the right components and making the technology easy to use, it's all for nothing if surrounding business processes haven't been integrated.
Unless a radical organisation can drive business adoption, its technology investment could become a white elephant, and the organisation could gradually regress to a formative state as investment in capability declines.
To move closer towards digital freedom, radical organisations should increase the involvement of business stakeholders before making further investment. An effective approach is to start with one business unit or brand, in order to showcase core capabilities and demonstrate success, and so reinvigorate the organisation's enthusiasm for digital transformation.
Cautious organisations: taking a back seat
Cautious organisations have taken a judicious approach to digital transformation for one of three reasons. The first may be because, despite a strong push from individual brands or business units, the cost and complexity of implementing a capable platform is considered too much of a barrier. The second reason may be that the scale of the capability development task hasn't been properly understood. Lastly, it may simply be that the nature of the business means that digital isn't seen as a critical part of the business process.
But if an organisation is too complacent about digital transformation, it can be exposed to disruption. You only have to consider how AirBnB inspired a whole new way of thinking about how to book your holiday accommodation. And when that disruption takes place — in the form of new competition, evolving customer expectations, or regulatory changes — the organisation will find that its lack of digital freedom will limit its responsiveness, leaving the door wide open to more agile competitors.
Even if there's little or no risk of disruption in a particular market, failing to transform digitally will lead to lost opportunities to improve performance, increase revenue and manage costs. Proliferation of digital properties, duplication of resources, inconsistent brand messages and slow speed to market can all put the brakes on performance.
To embrace greater digital freedom, a cautious organisation needs to have its finger firmly on the pulse of the market to avoid being surprised by unforeseen events. Engaging with thought leaders, learning from other industries, and keeping its thinking fresh will help ensure the organisation doesn't miss great opportunities.
Larger organisations will need to take particular care that opportunities for better governance and greater efficiency aren't lost through individual brands or business units pursuing their own digital agendas. That's because it's unlikely that potential efficiency gains will rest solely in the technical infrastructure: there will almost certainly be savings to be made by avoiding duplication of content and improving content re-use.
For these organisations, it will be especially important to show the value of increasing digital capability — not just by saving costs, but also by growing revenue through greater agility or an improved customer experience.
Liberated: free to act
Becoming a digitally liberated organisation is the target, but is never the end of the story. You have to keep putting in effort to maintain that state, and prevent your organisation from slipping back as things around you change.
Change takes many forms: organisational or structural; a merger or acquisition; or simply a change in the agencies and partners you work with. Through it all, ensuring adoption will be an ongoing process. And through it all, technology will continue to evolve, putting pressure on capability development. You'll need to keep pace with all of these changes to stay a digitally free organisation.
Where do you fit in?
Do you recognise your organisation as formative, radical or cautious? Are you keen to improve your technical capability, get more people on board across your organisation, or avoid missing out on new opportunities in your market?
If so, you'll know it's time to help your organisation further along the path to digital freedom. With greater digital freedom comes greater freedom to act, enabling your organisation to swiftly take advantage of — or even anticipate — changes in market and customer behaviour.
If you’d like to learn more, contact us at email@example.com. We’d be happy to take you through our free, half-day eye-opener session to analyse where you are on your transformation journey.
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