Cherwell: Why are so many companies struggling with digital transformation?

It’s become all but impossible to have a conversation about technology or business strategy without the words “digital transformation” cropping up. While the phrase has become ubiquitous at board level however, there will often be a large gap in understanding and engagement between business decision makers and their employees.

This divide was highlighted in our recent YouGov research, which looked at the attitude towards digital transformation and other common technical developments among employees of 500 UK businesses. The majority (57 percent) of respondents either admitted they had no idea what digital transformation actually was, or else misinterpreted it, with many assuming it meant moving to a paperless office.

Lagging on the global stage

Our research was in sync with the recent Dell Digital Transformation Index, which placed the UK 17th in its adoption of digital transformation. By comparison, developing nations such as India and Brazil featured much further up the list.

Most UK workers also did not consider their own companies to be innovative in our own research. When asked if they considered their employer to be a “digital innovator,” just nine percent of respondents agreed, with most saying they only adopted technology once it had become mainstream.

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The UK may not be faring particularly well at the moment due to political and economic uncertainty. Companies are often averse to change at the best of times, and the current state of flux has exacerbated this trait and caused many to hold off on investing in new strategies and technology.

Failure to truly embrace digital transformation is the result of several factors. However, established companies often struggle with digitalisation more than newcomers as they must tackle years of legacy systems, while digital natives can skip the bureaucracy from day one and embrace the latest technology immediately.

The work-life divide

The struggle for companies to adopt digital transformation is particularly apparent when you compare the average workplace experience with technology to our increasingly digital home lives. Consumers have access to increasingly sophisticated and easy to use technology that provides a level of efficiency and control many companies can only dream of. For example, a parent could use an app like Apple Screen Time to manage how their children access digital media, approving or denying request for more bandwidth in real time.

By comparison, requisitioning additional IT resources is often still a slow and painful process in the workplace. Many workers must endure long waits and being passed back and forth between different departments before they finally have their request fulfilled. The main culprits here are inefficient processes coupled with a siloed approach that means different departments do not communicate clearly.

Poor processes will waste time for both the employee making the requisition, and the departments fulfilling it, impacting both morale and productivity. When the same issues are encountered by customers, the company’s customer satisfaction and retention will suffer, impacting its profits and growth.

Making digital transformation work

One of the most common issues holding back digital transformation efforts is a tendency to focus on technology rather than business objectives and user demand. Firms can often feel pressured to be seen embarking on digital projects, particularly in order to keep up with competitors. However, implementing new technology without properly considering its impact can easily cause more problems than it solves. As Bill Gates famously put it, “automation applied to an inefficient operation will magnify the inefficiency”.

Organisations should start any digitalisation project with a clearly defined set of objectives outlining what problems the new solution will solve and what needs it will meet. It’s particularly important to keep the user experience – whether it’s the internal workforce or external customers – in mind at all times.  

As part of this process, digital transformation projects should be inclusive projects that involve all relevant stakeholders, rather than being relegated to a niche IT concern. Highlighting this, our research found that 42 percent of employees feel their businesses do not integrate data and processes across departments well. Digitalisation affects the whole business, so there should be a cross-departmental team involved to represent various interests and experiences. A more inclusive, united approach will allow various elements of the workforce to have a say in shaping the project and will also help to break down the interdepartmental siloes that so often cause inefficiencies.

The final element vital for making digital transformation work is strong leadership. The board and other senior decision makers have a vital role to play in both driving forward digital projects, and also overseeing the required changes in business culture. A concerted effort must be made to get the wider workforce aware of changes being planned, and actively engaged in the process.

Senior executives have the power and responsibility to ensure that not only is digital transformation a leading business objective, but that their employees are aware of what it means and how it will benefit them. With decisive leadership from the top and an inclusive approach at all levels of the business, organisations can demystify digital transformation and continue to develop and grow.