March 22, 2023
Why Digital Transformations Fail and How To Prevent It
Businesses around the world are being fundamentally transformed, due to technological advances that offer the potential for a better business model. With faster processing, more bandwidth, software redesign, cloud services, and the Internet of things, we can change the way people interact with technology.
A digital shift in business can lead to greater success, but without focus, it can result in failure. By not having a clear strategy or plan in place, a digital transformation can fail. Why do digital transformations fail and how can they be prevented?
What is digital transformation?
In the business world, technology has brought about challenges along with opportunities. These opportunities allow us to replace legacy software and improve client services by leveraging data. Using the right technologies will help overcome challenges and allow for future growth. The goal is to improve efficiency and optimize the business for speed, agility and reliability. A digital transformation helps customers to access a company how they want to, when they want to and where they want to in a simple, easy and frictionless manner. It enables employees to collaborate more effectively, have better tools, and automation to reduce time-consuming activities so they can focus more on higher-value activities.
Lack of focus
Organizations lose focus for many different reasons. Often there is a disconnect between departments and management teams. Departments become siloed causing communication and collaboration issues. This lack of communication can result in differing objectives and cause confusion around company goals. A digital transformation requires organizational alignment. Digital transformation failure reasons can include a lack of focus.
To overcome this lack of focus, it’s important to understand objectives and outcomes. Everyone within the organization should clearly understand their role and purpose. Communication between departments can be managed with meetings and activities to promote interactions across teams. Transparency between departments will help foster better communication and team alignment. A digital transformation failure can result from not having a shared vision across teams.
In order to thrive, a business must be able to adapt to customer and market changes quickly. By adapting to these changes, a business is better prepared to provide the products and services customers expect. Being able to change and adjust when needed provides greater reliability which leads to long-term growth. Organizations that can adapt quickly are better prepared to solve problems and overcome obstacles.
Besides reacting quickly, a business must make data-based decisions. Understanding data is key to knowing what changes to make and when to make them. By assembling the right resources and capabilities, adaptability will not be difficult. Having the right tools can automate processes to meet the needs of customers while providing an optimal digital experience. Digital transformation failure can happen if an organization cannot adapt.
Digital transformation requires strong technical leadership. Having a leader with the ability to both understand and inspire engineering and software teams is critical to overall success. A good leader will be able to effectively communicate a transformational vision across different teams – a vision that includes a shared strategy for optimizing the organization’s products and services to meet customer and business needs first. With a clear strategy, a good leader will assist technology teams to create speed, agility, and reliability. Success depends on team alignment and clear communication of expectations. Digital transformation failure reasons include poor leadership.
Leadership can make the difference between success and failure. It’s important to clearly define and articulate goals. Finding a leader that understands the technical requirements involved in making a digital transformation is critical. Without strong leadership, a digital transformation failure is likely. To avoid problems, start with research. Determine what is needed to make the digital transformation. Then create a clearly defined plan that addresses those needs. Once you have a plan, it’s time to find the right strategic partner.
Find a strategic partner
Having the right strategic partner is critical to your success. Digital transformations are an investment and expectations are high. Knowing the right tools and technologies – and how to implement them – will help control costs, reduce the margin of error, and execute more efficiently and confidently. A strategic partner can provide technology planning and development services. Understanding how to make the change to digital is crucial to success. There are often many questions to ask. The right partner will answer these questions and explain everything in granular detail. Having a partner with experience and knowledge can help you unlock hidden potential and prepare you for exponential growth. The right partner helps you to achieve speed, agility and reliability in responding to customer and employee needs, all inline with your goals and vision. Having the wrong strategic partner can cause a digital transformation failure.
Not having the right partner can lead to higher costs, longer development cycles, and an inability to scale and adapt quickly. If your partner cannot provide a long-term strategy to transform operations and reshape customer value propositions, then you are likely to fail. Without the right partner, a business may never reach its full potential. Digital transformation failure reasons include using the wrong strategic partner.
Digital transformations fail without adequate planning. The biggest cause of failure is a lack of focus followed by an inability to adapt to customer and market changes. Understanding objectives and outcomes will help you overcome a lack of focus. And having the right resources and capabilities allows organizations to adapt to changes quickly. Strong technical leadership and team alignment are key to a successful transformation. Lastly, finding the right strategic partner will ensure your digital transformation is a success.
We are equally skilled at being strategists and engineers. We invite you to request a free strategy session to explore how we can work together with you to deliver rapid and high-quality outcomes for your organization.