For the C-suite, digital transformation is a critical but difficult priority, lacking a clearly defined destination. But for those who embrace the long-term nature of the challenge, the rewards can be great.
In effect, digital transformation never ends. The process continually reinvents, forcing boardrooms to make unexpected pit stops along an infinite business roadmap.
Business leaders must regularly adapt and realign their priorities to keep pace with updated and increasingly stringent regulatory controls across the globe. They must respond to emerging technologies, greater efforts by governments to safeguard digital privacy and a continual need to encourage employees to update their digital skills, which can rapidly go out of date.
However, if done right, digital transformation is a powerful, profitable and productive approach to solving future challenges. So how should it be tackled in the long term, despite those many moving parts?
For Pete Hanlon, group CTO at global outsourced answering service Moneypenny, digital transformation isn’t finished when a business hits one goal. Having previously led a successful digital transformation for media brand Auto Trader, he says companies must accept the process as an ongoing cost on the balance sheet.
“One of the big mistakes companies make is thinking there is a one-off project cost for digital transformation rather than thinking of it as a cost of doing business,” he explains.
Be big and bold
To ensure the process continues, it’s important that companies continue to allocate funds to digital transformation initiatives every year, Hanlon says. “Having a continuous budget allows companies to prioritise and fund the best initiatives and continue to fund existing initiatives, allowing a culture of transformation to thrive.”
Hanlon is now focused on a continual implementation of the latest advances in artificial intelligence to meet the ever-changing demands and needs of Moneypenny’s customers. This stems from the need to “listen to your customers”, something he learned during Auto Trader’s digital transformation.
“We didn’t stop once we had migrated to the web,” Hanlon explains. “Our customers started to expect more. They wanted analytics, new ways to collaborate and communicate, new ways to pay, more data and more functionality, and we had to react.”
The company never had a single project to transform, he notes. “It was a continuous process of listening to our customers and adapting. If we had stopped listening to our customers after moving to the web, the site would have become irrelevant.”
Kelly Hungerford is director of digital transformation strategy and services at international oral healthcare company Sunstar. To keep digital transformation relevant, she says businesses must create a hub-and-spoke approach between their centralised operations and the markets they serve.
“By continuously optimising the transformation strategies together, the business keeps the central technology teams in line with market needs and central teams educated on the best approaches, trends and perspectives that drive in-market innovation,” she explains.
The days of forecasting and planning 10 years ahead are over, Hungerford says. She now looks 24 months into the future, with “a lot of give and take” built in. To maintain momentum, she ensures digital transformation projects are “big enough and bold enough” to be interesting but not so big that they feel unachievable.
“I work in 90-day sprints; if it takes longer than that, the work package loses momentum,” she says. “Always show value and return within a reasonable time. If you know your finance team likes to see returns in 12 months, work your project to their terms, at least until you have three to four successful projects under your belt.”
According to Ashish Gupta, COO at BT Enterprise, the two biggest obstacles to maintaining momentum on the digital transformation journey are a “resistance to change and insufficient digital skills”. The size of the organisation influences whether one issue is more pressing than the other, he says.
“We find the larger the organisation, the greater the resistance to change, often because they have more complex technology challenges and the pressure to deliver ROI is intensified,” Gupta explains. “On the other hand, smaller businesses are more affected by the skills shortage, lacking the technical skills to implement emerging technologies that will enable their digital transformation.”
Gupta thinks the solution to both is to “foster a culture of innovation and tech proficiency”. By tackling such organisational issues at the core and investing in people and their skills, the digital transformation journey can work at pace. “Upskilling the workforce and educating them on the benefits of emerging technologies will foster more positive transformational change in the long-term,” he says.
BT’s own digital transformation journey has been about “delivering the products and services our customers need to support their own goals fast and at scale”, Gupta says.
That’s why, earlier this year, the company established BT Digital. This will “embed a digital-led approach” into every element of its operations, with the goal of continuing to invest in “innovative technology internally” to create better digital and next-generation solutions for customers.
Gupta fears smaller companies may be falling behind in their own digital transformation efforts, with BT’s The Future in 2021 report showing that only about a fifth (22%) are pursuing such a strategy. He admits that the pandemic has forced many to prioritise survival over long-term thinking about tech adoption.
What can be done? Gupta thinks a strong partner and vendor ecosystem is needed. This would help small and medium-sized businesses (SMBs) meet the long-term challenges and continuous cycles embedded in digital transformation, as the ecosystem will build the right solutions and services that make the process easier to adopt.
These will in turn support the SMBs’ digital transformation ambitions. Emerging technologies are such a driver for change that they mustn’t be overlooked by these firms, he warns.
“We know SMBs often find tech information too confusing and more needs to be done to educate them on the transformation potential of technology.”