Critical success factors for Digital Transformation

Introduction

Thought provoking session from Kuldip Sandhu on Wednesday night. I was keen to attend because the title of the talk – Digital Transformation – is something many of my clients are grappling with. However, they all have different interpretations of what digital means to them, and of course the scope and scale of transformation is different in every case so I want to keep upgrading my knowledge.

Defining Digital Transformation

This Change Management Institute UK event triggered ideas about what digital could mean. Kuldip used an example of the evolution of personal transport from horse and cart to cars. The big shift is how individuals are now the recipients of instructions rather than the implementers.

We used to drive cars, taking every decision for ourselves from putting on the lights and windscreen wipers to applying the breaks. Now these decisions are taken by the software running the car based on the data picked up by its sensors.

When things are done for us we move from providing our own service to being consumers of a service. This turns us into the audience which means we can sit back and criticise what we receive.

Our expectations of service from others is more demanding than when we are delivering the service to ourselves. If software delivers a good service our demands for more services increase. We want software to anticipate more of our needs and carry out more tasks.

This example highlighted two issues:

  1. To be successful organisations need to be ahead of the expectations of customers. They must have a development plan which clearly maps how their services will evolve. If they don’t they run the risk of only satisfying their customers for a short time. For example, having a successful app which enables passengers to easily book travel makes customers happy in the short-term but if it doesnt evolve to ping them details of delays, offer them additional services related to their travel and continue to learn from each trip to personalise the information it provides then we think it is a poor quality app.
  2. Empathy for the customer must be at the core of all decision making. By empathy I mean a willingness to walk in the shoes of customers. Step back and imagine every possible demand they might have. Develop personas to learn what your customers concerns and preferences are. Use scenarios to understand the different ways they will experience your service.

The final part of the presentation got us thinking about different business models in a digital world. When I review my clients that are succeeding with digital transformation, they have understood a basic truth. Data is a new asset class. It must be nurtured and protected just as we would look after buildings and machinery.

Put data at the core of every design decision. Start by looking at how data can do the work for the client. Using my travel analogy, When I book train tickets I want the data to use my previous history to predict every need for my whole journey from booking taxis, booking hotel rooms, sending receipts to my accounting software, updating my hotel loyalty programme etc.

  • Map how data does things for the customers at every step of their experience.
  • Identify how data can be reused so it is collected once and used for multiple purposes shared across many systems.
  • Work out how data can be used to anticipate the decisions customers take throughout the order to cash lifecycle.

As data is now an asset it can be used to develop your business model, offering opportunities to collaborate with partners who can offer complimentary services.

Conclusion

My final thought is that digital transformation is a cultural change because it is a different way of thinking. It must be treated as a cultural change, so the assumptions, values and priorities of the organisation in this data driven world must be defined. Thought must be given to how this changes the roles and responsibilities of staff and the quality standards applied to their work. Create an environment that rewards customer empathy and questioning of what might be possible to ensure your services continue to evolve.

If you want more great events like this, book your next Change Management Institute chapter event now.