Engage the entire organization in the transformation

The businesses that emerge successfully from digital transformation form cross-functional agile teams to execute the transformation. Make the transformation of individual capabilities and processes iterative but set clear expectations and sustain communication with all stakeholders, including customers. Engaging customers through focus groups and iterative joint design sessions can be an element essential to success, too. Obtaining input from customers every step of the way is both useful and rewarding, as customers love to use what they have had input in designing. In addition, there should be a focus on iterative transformation showing early successes and iterative value capture while driving towards a broader repositioning. It is important to remember that digital-native businesses typically start with a clean sheet, which is easier. Transformation is much harder, though critical for long-term survival. Hence it is important to get the entire organization into the transformation mindset.

Be fanatical about data

For companies undergoing transformation, data can be an afterthought. Organizations need to realize that digital transformation without proper data and analytics will not be effective. Having a clear data strategy and environment is absolutely critical to drive effective transformation. Most organizations, however, struggle with this critical piece because of the complexity of the data environment. Organizations should deploy the same methodology outlined above in iteratively refining data to support value capture.

To focus on value capture and realization every step of the way, institute a culture of formal value definition, capture and verification in every iteration. Capturing value every step of the way not only makes continued investment and capital allocation easier for the CFO but also energizes the entire organization as value is freed up for other investments and rewards.

Resist the lure of technology—focus on business-led transformation

One of the biggest risks of such a transformation is either leading with technology, or assuming that digital transformation is just about technology. Often, organizations get distracted by glittery new technology and end up just focusing on this shiny new toy. As a result, they end up spending an inordinate amount of time and money to realize very little value overall. A disciplined approach to transformation—leading with business needs first and using technology as an enabler—is critical for successful transformation

Institute a thoughtful and rigorous change management capability

Many transformations fail because organizations forget that the changes impact people’s lives and consequently, if not managed mindfully, will lead to the failure of the transformation. This is where HR and PR become an integral part of the transformation design and execution.

Institute strategic governance to drive the transformation towards business model redefinition

It is easy to lose the forest for the trees in the transformation process. Organizations should not lose sight of the broader business model change and agility in their efforts to improve customer experience or deploy digital capabilities for customers. To ensure the bigger perspective remains within sight, a broader strategic governance is required. The board and the executive team should measure the transformation path against the broader strategy periodically to ensure that the organization is moving towards the ultimate goal and course-correct as changes happen in the environment.