The Open Secret of Digital Transformation
Everyone knows it but only a few actually do it
The Harvard Business Review recently conducted a survey of 734 of their readers primarily from large, but also from some medium and small, business organizations who encompassed mostly top and higher management but also some middle managers from over 4 different industries, to assess how the respondents rated themselves against what they saw as the most binding constraints to Digital Transformation success – the company culture. The survey and the results were made available to us by RED HAT Innovations labs.
The key, but not very new, finding of the survey was that Culture, which was seen as how knowledge, processes and habits are passed from person to person, was the single most important impediment to digital transformation success as well as the strongest driving force behind it. While most of the respondents acknowledged this, only the few successful senior managers actually managed to bring about the cultural change that was needed in order to harness the engine of change that was so fundamentally changing their business reality.
No matter the size of the organization, the culture or the way of looking at or thinking about or of interacting with, people and things in the organization, was the most important obstacle to bringing about any kind of change. Five key success factors emerged from the responses that were given. The more successful change management approaches were those that were more:
Adaptable – where there was flexibility and risk tolerance with room for error and trial and the understanding that things could go wrong but were correctable. Somewhat like the Kaizan process discussed in a previous post on this forum.
Collaborative – were there was mutual support and help with a team and group approach which was welcoming of new entrants and ideas from outside of the immediate project teams. No “not invented here” mentality being encouraged.
Inclusive – everybody was involved in the process. Anybody could attend any meeting they wanted and were welcome. All ideas and input was welcome since everybody had a stake in the game.
The other key characteristic that emerged was that there was significant cross fertilization between IT and the Business side. The business people embraced agile methods from IT and digital technologies adapted themselves to operational technologies ( see also the Lockheed-Martin case study in our Industry manufacturing page).
The results for the more successful transformation managers were clearly distinctive. The significant responses were on (i) Market share gain and customer retention; (ii) revenue and profit growth; (iii) new product introduction and speed to market; but the most important longer term benefit was significant improvement in employee satisfaction.
So top down managers need to take note: In Digital transformation, technology is the easy part the organizational culture must also change – not because people have to but because they want to.
Source: Red Hat