In 2015, a comprehensive study by management consultancy Arthur D. Little suggested that most businesses were struggling with digital transformation. Problems included having no strategy in place, not having the digital knowledge to recognise threats and opportunities, and being too reactive to developments.
We’d argue that times haven’t changed that much. While there are certainly more digital-centric start-ups appearing, more established businesses are struggling to adjust course in the increasingly choppy competitive waters and still don’t quite understand where they might be going wrong.
With that in mind, here are four challenges you’ll face with digital transformation and how to overcome them.
1. Creating a culture that can embrace change
Another survey, this one by American company AT&T, found that nearly 63% of companies saw changing company culture as being extremely significant in making digital transformation a success. And we couldn’t agree more.
Businesses consist of people with specific roles, each demanding a specific set of skills and responsibilities for the business to work. A successful business and its employees will have honed these roles and responsibilities over the years, so any disruption is always going to be viewed either with cautious hesitation or (in some cases) outright hostility.
This is often enough of a problem in itself to be considered one of the biggest challenges facing companies undergoing digital transformation. Yet even if you domanage to get everybody on board, you’ll soon find yourself with another headache given that most company cultures consist of isolated silos—making a holistic approach to change almost impossible.
Establishing more of a community feel across the organisation can help overcome this, because it allows for better communication and collaboration between those silos. It might take a little time, but it’ll be worth it to build those trusted relationships that will help produce a more coordinated transformation. Of course, this is easier said than done, which makes it even more imperative to ensure you have the right leadership in place to educate and guide the various teams through the transformation. Which leads us to…
2. Finding the right person to lead your digital transformation
We talked about this in more detail in a previous article, where we saw how companies are often putting the wrong people in charge of their digital transformation. Chief Executive Officers (or even Chief Information Officers) might initially seem like the right people to lead the change, but in reality they don’t have capacity, the digital knowledge, or holistic view of processes across the organisation to be able to coordinate such a drastic change in business strategy.
We’d suggest that having a (potentially new) Chief Digital Officer role is the key to overcoming this issue. This means appointing a digital expert to oversee all facets of the ongoing transformation processes—someone at a senior level who can work closely with the CEO, who has the authority and oversight to help guide the business smoothly and efficiently through such a challenging time.
3. Not having a clear vision for the digital offering your customers need
In our experience, customers can easily adapt to new digital ways of interacting with businesses, especially if they know it saves them time, hassle or money. It makes sense, therefore, for companies to make sure they have a clear vision for the digital offering their customers need—even if the customers don’t know they need it yet.
Unfortunately, a lot of businesses flail about a bit when it comes to their digital offering. They often haven’t taken the time to understand what—or where—they need to be as a digital-centric company. They haven’t thought about what their customers need (now or in the future), or where their customers might be reached, and end up throwing time and money at technologies and platforms simply because they’re popular and known brands. Leading to them getting very little return on their digital investment.
Making sure you have a vision is imperative to avoiding stumbling through your digital transformation. Look at emerging technologies, look at what your competitors are doing, and above all study the market to reveal what your customers are demanding in order to know what you should be offering. Your vision doesn’t have to be that comprehensive to get the ball rolling—and rest assured you’re not locked in forever (it will often change as your customer needs change)—but without at least some idea of the digital direction you need to be heading, it’s unlikely you’ll get anywhere and your customers will be left feeling frustrated and going elsewhere.
4. Poor use of customer data
Customer or consumer data has been in the spotlight a lot lately. Not only do you have the ongoing coverage into Facebook’s sharing of details from millions of user accounts (with companies who arguably have nefarious intentions), but you’ll also have seen adverts or emails from companies looking to amend their own approach to customer data, thanks to the new General Data Protection Regulation (GDPR) coming into force on 25 May 2018. This new regulation will reshape how organisations deal with data privacy, as it enforces the rights of citizens when it comes to how their data is used across Europe.
However, one of the biggest challenges with customer data isn’t secret sharing of social media activity or the introduction of new laws, but businesses not being able to use the data effectively. Information may well be collected, and there could be a lot of it, but siloed storage might ensure there’s no way of drawing it together for analysis. Or even if there is a way of running reports, nobody is quite sure how to leverage the results in a way that helps improve the customer journey.
The solution here is to go back to basics and develop a solid strategy for data gathering and use. Identify exactly what customer details you would need to know in order to deliver a better experience with your company or platform (which ties in with #3, above). Then work out how to best collect and store that information in a central location, so that it’s accessible to all relevant staff, and ensure they’re trained well enough to spot any areas of opportunity. Do this and your business will always keep the customer at the heart of the digital transformation.
Want advice on making sure your digital transformation is going to plan or need help getting started with your strategy? Get in touch and we’ll be happy to guide you in the right direction.