Why and how to start a digital transformation programme

As an agency making high stakes digital change happen for our clients, we’ve put together a five part guide designed to support digital leaders in executing a successful digital transformation project.

In this first part of the guide we clarify what we mean by digital transformation, we identify the drivers for organisations to undertake digital transformation programmes, and we outline the different approaches to transformation.

What is digital transformation?

Digital transformation is something that plenty of people talk about, but often without a common understanding of what it is and how it could happen.

Deeson has been successfully delivering digital transformation for our clients since 2004, and our extensive experience has shown us that genuine digital transformation involves not just technology but people and processes in organisations too.

That’s why we define a digital transformation as:

Generating incremental value through radical innovative change affecting people, processes and technology.

Why start a digital transformation programme?

Understanding why you want to transform part of your organisation is critical.

Defining your reasons helps stakeholders understand how you’ll evaluate success and what you want to be different in future. We know from our work with high profile clients that there are up to seven potential reasons for initiating a digital transformation project.

In practice most organisations we work with are experiencing several of these factors at the same time.

Sometimes these drivers are intrinsic to the organisation and sometimes they relate to the wider context in which the organisation is operating.

Internal drivers for digital transformation

1. StrategicChanges initiated proactively as a result of corporate strategic planning to deliver specific future benefits to the organisation. 
2. EfficiencyTo reduce operating costs and eliminate costly inefficiencies in how products or services are delivered. These can include a mix of customer-facing activities and “back office” activities.
3. ObsolescenceWhere an existing technology platform reaches the end of its economic or supported life and needs replacing.

External drivers for digital transformation

4. DisruptionWhere new entrants are disrupting a market and existing players in the market need to respond rapidly to remain relevant.
5. OpportunityWhen changes happen in the market that open up a new opportunity to deliver value.
6. CustomerWhen customer expectations are changing, typically as a result of their experiences elsewhere, so the company needs to radically improve its product or service offer to its customers.
7. CompetitorsWhere an organisation is experiencing substantial changes in its competitive environment and is being forced to change to avoid loss of market share.

Making sure that there’s clarity about the drivers for digital transformation is a vital first step. It helps ensure alignment among stakeholders about why there’s a need to change and how this change might happen.

Approaches to digital transformation

It’s important to consider the different approaches for how your organisation will deliver digital transformation. It will dictate how the programme of change is planned and executed. Selecting the right approach for your goals will maximise the chance of successful change.

Over the past thirteen years we’ve seen different approaches to digital transformation come and go. We’ve felt the pain of poorly conceived approaches and we’ve seen radical transformations delivered with unexpected ease too.

Let’s take a look at four broad approaches that organisations can take and what we’ve learnt about each from working on real digital transformation projects:

Process-led

Making change by redesigning internal processes to reduce inefficiencies. A favourite of old school management consultants and Six Sigma aficionados, but not one we love. We’ve seen users – customers and staff – suffer too much when this approach is taken and their needs are ignored. This can lead to poor adoption of changes and a transformation that’s far less likely to be sustained in the longer term.

Technology-led

Starting with the new system to be implemented and then designing from there.

Often happens when the driver for transformation is system obsolescence. This can go well when there’s limited appetite for change in the organisation, but in our experience tends to under-deliver as it neglects the importance of users and doesn’t focus enough on improving processes.

Brand-led

Using your brand promise and values as the basis for a digital transformation.

In our experience this approach can be effective where there’s a deep understanding of the concepts of branding within an organisation, as the brand provides a heuristic for transformation decision making. For organisations with a strong brand, it offers the opportunity to align your processes, technologies, and people in ways which reinforce that brand. It can be less effective where the concept of branding isn’t well embedded or understood.

Customer experience-led / Service design-led

Taking an evidence-based approach to designing and delivering a customer experience.

Aka customer experience design, experience design, CEX, CXD and a bunch of other acronyms too. One of our favourite approaches to digital transformation as it helps balance users, business processes and technology platforms to come up with a coherent and evidence-based change programme. Cross-cutting in nature involving multiple internal teams/departments.

What next?

This is just a snapshot of the reasons we’ve seen organisations want to get started with digital transformation, and of the approaches that can be taken to delivering value through digitally-led change. 

The next post in our five part guide will explore how to create a strategy for successful digital transformation. We’ll be looking at a pragmatic and learning-based approach to digital strategy that draws on techniques including lean startup, innovation thinking and agile.

We run regular events where we share our experience and hear from other digital leaders who are at the sharp end of digital transformation in their organisations. If you’d like to join us, get in touch.