Digital Transformation Success Is A Self-Fulfilling Prophesy

The survey of 450 executives, published by Couchbase, estimates organizations risk wasting millions of dollars in the next 12 months as they rush into flawed digital projects — an average spend of $28 million. A majority, 52 percent, said a fixation on digital transformation had raised the risk of rushing into ill-thought-out projects, meaning a lot of that could be wasted.

Industry executives speculate that a fear of failure is part of the reason many companies avoid digitally transforming in the first place. That’s the view of Justin Rodenbostel, who points out that digital transformation is a big-budget initiative, and therefore has a large target painted on it. Unlike typical technology initiatives that can be, and often are rolled back if things don’t work, digital failure may set an organization hopelessly backward.

Rodenbostel, who is vice president, open source application development at SPR, suggests organizations need to carefully prepare for the changes that digital transformation could potentially deliver. All too often, enterprises don’t move fast enough. “The biggest risk is missing the opportunity — being beat to market by an outsider or a competitor, letting perceived constraints prevent innovation, failing to seize opportunities to pivot, and going into an initiative without an adequately prepared and capable team,” he said.

Digital transformation is many things to many people in different departments, so it’s important to decide what the end result of digital transformation should be. What do executives in the Couchbase survey think their digital transformation should look like? The researchers observe that “we are entering the era of the ‘massively interactive enterprise,’ where digital experiences can transform every part of a business – from customer experience to business functions such as sales and marketing, HR, and finance, and even logistics and manufacturing. Currently, respondents are focusing their digital transformation efforts on customer-facing experiences (66 percent) and business processes such as logistics (62 percent). There is less attention paid to areas that also benefit the massively interactive enterprise, such as worker-facing experiences (47 percent) and machine-to-machine services (37 percent).

“A successful digital transformation ends with market-leading products and services offered by an organization,” Rodenbostel says. “The organization has seized previously unclaimed differentiation by bridging the gap between their products and services and what has become possible through advancements in technology and the way we conduct business. ” For example, he illustrates, Netflix “cannibalized their existing offerings when they moved from a distribution and logistics company to an industry-leading tech company with the capabilities it has today. That is a lot of risks to take on, but their future depended on it.”

To succeed with digital, Rodenbostel has one important piece of advice: just get started, just do it. “I would consider failed initiatives being the ones that never got off the ground,” he says.

The following actions may help alleviate fears and pave the way to digital transformation:

Plan for innovation: “Start with research and brainstorming,” Rodenbostel advises. “Look to the ever-growing list of companies that have disrupted a market or are on their own digital transformation journey – what innovations contributed to their success and where did they maybe go wrong?”

Remember — it’s always about the business. “The greatest risk in digital transformation is that organizations develop a fixation on digital transformation for its own sake, deciding that in an environment of accelerating disruption, any transformation is better than no transformation,” the Couchbase researchers relate.

Review your alternatives: “Narrow down your list of potential initiatives based on the initial thinking of potential value from an idea vs. the potential effort expended and potential exposure of risk to the company,” says Rodenbostel. “After you have a list of those initiatives, it’s worthwhile to take a step back and gauge your organizational readiness to take one or more of them on.”

Form a team: “Assemble a cross-section of your organization, ask them how they do their job, how they think it could be done more efficiently, and what would make their lives easier.”

Ask the right questions: “Find out what questions you’re asking yourself about your organization that you consistently have difficulty answering.”