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In the midst of a complex digital transformation project, it’s all too easy to focus exclusively on the implementation of vital technology and neglect the strategic planning, the people component, or the processes that will support the new system. Yet successful digital transformations require the synchronization of these four essential elements so that they work together in harmony, connecting disparate business functions and breaking down barriers. These advancements, in turn, enable the continuous innovation and evolution needed to achieve the digital transformation necessary to compete in a rapidly changing environment.
The following eBook, published by Mario Desiderioauthor, Huron leader in technology-centered improvement and recognized by The consultation report as a 2022 Top 25 Technology Leader, tells how finance executives will thrive in their digital transformation initiatives.
Digital transformation, as a concept, is not new. Thirty years ago, it was all about embracing the idea that businesses needed a website. Today is about integrating business capabilities with technology and leveraging the Internet of Things (IoT), robotic process automation (RPA) and artificial intelligence (AI) to develop a competitive advantage.
One of the most critical mistakes an organization can make is to pursue transformation in which strategy becomes increasingly disconnected from other elements of business synchronization as the project progresses. With outdated systems and processes, companies are bound to constantly lose market share and will struggle to compete for top talent. The opportunity for leaders is to ensure the organization does not lose sight of its North Star goals while maintaining clear connections to the people, processes and technology that support the effort.
In a world of ever-changing technology, we see brilliantly innovative solutions emerging on the market at an ever-increasing pace. The rise of these advancements is now allowing enterprises to unlock a host of unsuspected capabilities in recent memory. However, this simultaneously made the landscape increasingly difficult to navigate and understand. Nevertheless, global spending on digital transformation continues to reach record highs year after year, yet most companies are failing to generate any business value from their digital transformation efforts, let alone achieving the expected business results. .
It is undeniable that digital transformation is no longer just a desire, but a requirement for businesses in this increasingly competitive environment. Leaders need to rethink their approach to digital transformation. They need to ask themselves what changes need to be made technologically and strategically, not only to survive, but also to thrive in this age of complex business technologies. With such a diverse range of potential changes that can be made, there will never be a one-size-fits-all approach to digital transformation. However, we find that for any business, by focusing on a few key areas of synchronization that are often overlooked, we can come monumentally closer to truly optimized digital transformation.
The first step is to establish a clear and consistent vision of the ideal future state. This often involves becoming less siled and more centralized, using data-driven decision-making capabilities, and improving overall efficiency and understanding. Process optimization can result in the creation of 20-40% operational efficiencies. Data-driven decision making can save 20-40% and increase the overall productivity of finance teams by 50%. However, while many organizations can identify these goals and understand how this improvement might occur, they often overlook the downstream implications of these changes. Implementing new technologies inherently requires substantial process adjustments and existing organizational models often become obsolete. Failing to face these realities leads organizations, at best, to underutilize their new capabilities or, at worst, completely erase the positive impact of their digital transformation. Therefore, it is paramount that organizations put in place a thorough change management strategy and consider the necessary changes to their organizational structure.
We can analyze the success of a digital transformation initiative by looking at two critical areas. First, we need to look at the operational success factors: speed, usability, and proficiency. Even if an organization perfectly implements a complex system with advanced features, it doesn’t matter if employees don’t use it properly. As such, we need to study user adoption rates, their overall use of new systems, and their skill level to effectively leverage their new capabilities. Second, we look at the overall performance drivers of an initiative: achievement of transformation goals, delivery time, and budget performance. An organization’s success in all of these focus areas varies greatly depending on its commitment to change management.
Organizations that prioritize excellence in change management have been shown to experience online or greater speed of online user adoption, user utilization of new systems, and user proficiency with new systems. users at rates far exceeding those who did not. Additionally, we see the same disproportionate levels of success when looking at the overall performance of an initiative. Organizations that prioritize excellence in change management are significantly more likely to meet their transformation goals, meet or advance schedule, and meet or meet budget than those that do not. not.
There’s no end in sight to the development of breakthrough business technologies, and it’s easy for executives to focus solely on the cost and capabilities of solutions. However, if organizations want to optimize their digital transformations, it is imperative that they remember the processes and the people behind the technology. Timing is the answer to success.