Innovation

Common digital transformation mistakes to avoid

Common digital transformation mistakes to avoid

The need to ramp up digital transformation is keeping executives up at night. According to a Forbes Insights study, digital transformation is now the number one strategic priority in many companies. The report found that 50 percent of senior executives believe that the next few years will be critical to driving digital efforts to prepare for the future.

The reason companies are focusing on digital transformation? They see it as the key to unlocking exponential growth, according to Forbes Insights.

As companies apply technology to improve their efficiency and increase their competitiveness, however, they might make digital transformation mistakes along the way as they reorient their business. Here’s a look at three of the most common pitfalls business leaders need to look out for.

Setting only short-term goals

Digital transformation is an ongoing process of change based on the needs of the business and the evolving expectations of customers. But in many companies, digital transformation is seen as a short-term project—one that has a completion date.

Consulting firm McKinsey & Company cautions that yardsticks focused on the short term, such as return-on-investment (ROI), can be misleading. Instead, non-traditional metrics that evaluate digital adoption, such as new registrations on digital channels or digital-engagement levels, are better ways of measuring an organization’s digital transformation success.

The core of the organization—comprised of its value proposition, people, processes, and technologies—must be transformed with the longer view in mind, McKinsey emphasizes. Otherwise, the legacy organization’s influence will hinder any true progress in digital transformation.

Letting technology overshadow customer experience

Digital transformation mistakes are often the result of relying on technology without thinking of the bigger picture. Technology is an enabler; customer experience should be the principal driver and guide the transformation.

One example comes from T-Mobile, which was doing well before its digital transformation, but not well enough in the company’s mind. It decided to put customer experience at the heart of its digital transformation, investing in both the present and the future. T-Mobile’s aim was to radically change its approach to delivering customer experiences, while also giving the IT team enough breathing space to maintain current platforms and migrate to new ones.

A deep understanding of customer needs helped T-Mobile create products that were useful and successful. For example, the company developed its mobile app with the specific goal of improving customer service. As part of the app’s revamp, it added messaging capabilities that enable customers to chat with customer service.

Ultimately, T-Mobile balanced its immediate commitments to shareholders while also meeting its digital transformation goals laid out over several years.

Not setting priorities

To get organization-wide buy-in, CEOs need to lead the charge in digital transformation. CEOs must prioritize rather than get pressured into finding and deploying technology as fast as their budgets will allow.

Without explicit support from the leadership team, great ideas could fail because they don’t get the attention and investment that’s necessary for long-term success. Teams and individuals often understand both the threats and opportunities within their field of influence, but that can lead to ad-hoc and uncoordinated deployments that lack the proper framing and orchestration at the overall company level.

Digital transformation must be customer-centric

In many industries, the ability to drive digital transformation will separate the winners from the losers. Companies need a structured, thoughtful approach guided from the top ranks with a customer-centric strategy if they are to succeed over the long term.

The Enterprise Guide to Customer Experience (CX)



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