DT is complex, but can be simplified with the right approach!
Digital transformation is not at all a simple task. The high failure rates and insignificant returns from the digital efforts, so far speak for the complexity and challenges. With numerous challenges encountered during the journey, the main root cause for these challenges is underestimating the complexity of the interplay of different elements of the organization. Study of how organizations approach transformation provides evidence that numerous interdependent factors are overlooked. Digital Transformation is commonly approached as disparate and disintegrated IT Projects in the organization, overlooking the fact that even that is a candidate for transformation.
“Digital Transformation is commonly approached as disparate and disintegrated IT Projects, leading to challenges and high failure rate!”
This results in frustration within the organizations after having spent a substantial amount of time, resources, and money. After all, the technology maturity is running faster than commercial availability and adoption by organizations for business benefits.
“Technology hypes out at a faster rate than the rate of commercial availability, product maturity and adoption of these technology-enabled products by organizations.”
Whilst it is true that an organization is not immune to external factors like digital technologies, competition, market, regulations, etc, digital transformation is about a complete introspection and overhaul from the inside out. Focusing and zooming on with the lens of internal organization transformation, a successful digital transformation requires a radical transformation of organisations to best leverage the capabilities of digital technologies for successful business outcomes.
Barthel and Hess (2019) concur that digital technologies disrupt organisations, forcing them to rethink and adjust their offerings, leading to radical changes within the organisation. Skog, Wimelius, and Sandberg (2018) found that digital transformation not only triggers but is also spurred by numerous digital innovations that lead to disruption. In this scenario, digital innovation is described as a process to embody digital technologies to create new products, processes, or business models, thereby playing a dual role, affecting both process and outcome (Skog et al., 2018).
According to Nambisan et al. (2019), the term digital transformation in business literature signifies the disruptive effects of digital technologies for businesses, indicating how existing organisations need to transform to succeed in the digital economy. The digital transformation of businesses is being driven by top managers to strategically utilise digital technologies in a way that significantly impacts the development and execution of digital strategies (Peter, Kraft, & Lindeque, 2020). Parviainen, Tihinen, Kääriäinen, and Teppola (2017) found that digital transformation triggers changes at multiple levels, such as process levels, firm-level, and business domain level.
“Digital transformation, therefore, can be understood as a strategic change that the organisation needs to undergo to harness the disruptive potential of digital technologies through numerous digital innovations and related changes in organisational resources and capabilities.”
To summarise, the digital transformation of organisations can be said to be related to organisational changes due to digital technologies. These changes are characterised by changes in value networks (Riasanow, Galic, & Böhm, 2017), the evolution of corporate business models (Delmond, Coelho, Keravel, & Mahl, 2016), digitisation of products and business models (Planing et al., 2016), and profound changes to business models (Hess, Matt, Benlian, & Wiesböck, 2016). This leads to the transformation of processes (Legner et al., 2017), resources (Sebastian et al., 2017), operational methods (Legner et al., 2017), organisational governance, and the culture of a company (Sia, Soh, & Weill, 2016) “by re-inventing itself for future every-one to every-one digital economy” (Berman & Marshall, 2014).
“The key dimensions of Digital Transformation from previous research can be broadly divided into strategic, data, customer, IT, innovation, organisation governance, and digital capabilities-related domains.”
This leads to a very important question – “What are the critical internal organisational factors of digital transformation related to the above domains, and to what extent do they influence each other and also the Business Performance?”
After a rigorous and in-depth research, I have developed a framework grounded in multiple theories (resource-based view, dynamic capabilities, and disruptive innovation) and is based on a detailed literature review of more than 1200 articles and 19 digital maturity models. The research model was validated using 294 responses domain experts (Senior leaders & experts, mostly VP and C level executives in the Telecommunications Industry Value Chain) in the Indian telecommunications industry and was found to be robust.
Contact Digital Transformation Simplified™ to know:
- The internal organizational factors critical for a successful digital transformation
- Their dependence and influence on each other and also on successful outcomes
- Prioritization of the initiatives and a systematic methodology for implementation
“Digital Transformation is complex, but if approached correctly, can simplify the journey!