Digital Transformation Is A Marriage Not A Wedding

5 years ago
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“In a chronically leaking boat, energy devoted to changing vessels is more productive than energy devoted to patching leaks.”

– Warren Buffett, Chairman and CEO of Berkshire Hathaway

The operative word in digital transformation isn’t digital, its transformation. Many fail to realise that transformation is a process requiring stages that build from each other. These things take time (a lot of time) and must be tended to continuously.

One of the biggest mistakes leaders in the age services industry can make is to view technology as a plug-and-play solution to their organisational challenges—with expected immediate returns to boot.

At best, you might address a discrete organisational or service problem—for example, better falls prevention technology in homes—yet be nowhere near to redesigning and improving the organisation’s entire customer experience.

If you think about why transformation initiatives aren’t moving from pilots to whole-of-organisation initiatives, this is because organisations primarily treat such initiatives as an event, and not a process. It’s no different to mistaking your wedding for your marriage.

As our industry continues to address ongoing reforms and meet consumer demands, it’s important to note that many of these organisations were not born digital, and as such, entrenched mindsets and ways of working run counter to digitally intense organisations.

Where digital organisations typically are better at conducting rapid experiments, collaborating fluidly across functions and hierarchies, and are data-driven—traditional organisations are generally better at working towards stability, and adhering to rules and compliance.

However, successful digital and traditional organisations are aligned in their focus on meeting their customers’ needs and wants, and being accountable to measurable results. As an incumbent age services organisation, striving for stability and having to be compliant need not be an inertial drag on one’s transformation process. George Westerman, Director for Workforce Learning at the Massachusetts Institute of Technology’s World Education Lab, suggests the following principles:

  • Create guidelines that enable speed and autonomy without sacrificing integrity.
  • Develop processes to rapidly identify places where guidelines are not being followed.
  • Create easy ways to suggest changes to guidelines.
  • Help employees keep their skills current through training and stretch assignments. 

At a broader transformational perspective, John Kotter, retired Professor at the Harvard Business School cites the following milestones for successful transformation initiatives:

  • Establish a sense of urgency — convince at least 75% of your managers that the status quo is more dangerous than the unknown.
  • Form a powerful guiding coalition — assemble a group with shared commitment and enough power to lead the change effort.
  • Create a vision — create a vision to direct the change effort, and strategies for realising that vision.
  • Communicate the vision — always talk about the new vision and ways of achieving it, and lead by example.
  • Empower others to act on the vision — remove barriers that hinder the new vision, and encourage risk-taking and non-traditional ideas and activities.
  • Plan for and create short-term wins — define and implement performance improvements, and reward staff for contributing to those improvements.
  • Consolidate improvements and produce more change—use increased credibility from wins to create more change, and to reinvigorate ongoing transformation initiative.
  • Institutionalise new approaches — articulate the connections between new behaviours and corporate success, and establish aligned leadership development programs and succession plans.

Again, transformation initiatives are fundamentally a process, and not an event. Research by Erik Brynjolfsson and Lorin Hitt, involving over 600 organisations, found that it took five to seven years for full productivity benefits to be realised from technology investments. Equally, every dollar invested in technology correlated to an additional nine dollars invested in the organisation’s staff and processes.

Forget for a moment thoughts of adopting artificial intelligence (AI) as a means to leapfrogging the hard work needed for digital transformation to take place. AI requires quality real-time data that is ideally integrated into operations processes. As such, AI is more an extension of, rather than a shortcut to digitisation.

In short, unless your organisation is a digital native, transformation will take time and be a messy process. There’s no off-the-self technology solution to this; your organisation’s ability to collaborate across silos, risk appetite, and data readiness are antecedents to your success.

To quote Ebenezer Scrooge in Charles Dicken’s A Christmas Carol: “Is this what must be, or what might be?” The answer, and the future of your organisation, is consequently up to you.

Merlin Kong is Head of innovAGEING, Australia’s national innovation network for the age services industry.