Digital Transformation Has to Be Holistic in Approach

A lot goes into a successful digital transformation strategy.

Consulting with companies across industries has led me to several conclusions.  First, everyone is trying to achieve digital transformation but few really understand what that really means. Secondly, almost everyone is doing it in a silo. Thirdly, there are similar and uncoordinated efforts to “transform” happening all across organizations.  Everyone has the desire, or necessity to transform buying into the hype that it will change their business or reduce costs, but most are doing it wrong.  They lack high enough executive sponsorship, they don’t understand across the organization what it is capable of, they lead with the tool vs the process and they especially don’t coordinate the effort, leaving often many teams doing essentially duplicate efforts.  This problem is the same in big or small organizations and universally across industries.  Who is playing air traffic control?  I have seen organizations create Chief level transformation officer roles and then focus them on operations vs. the magic of process and technology.  Simply put, this is complicated stuff and the unicorn (magical creature that will ensure success) you need is a blend of business optimization and a deep understanding of an arsenal of technologies.  Good luck finding that person.

The most success I have seen has a few characteristics.  First, they have the highest level of executive sponsorship and that’s person is deeply knowledgeable about the process, technology and has a clear vision of the outcome.  Whoever you just thought of, think again and go higher.  The board needs to understand deeply, the C suite, the next level and all the way down.  The next thing is they don’t even worry about what technology but focus on the business process redesign.  That is where the magic can happen.  When was the last time we rethought our processes…? on average it has been 15 years.  Where was technology 15 years ago…. exactly.  They then get sold one solution by a company like an RPA, but the most success comes from an arsenal of tools.  You can’t fix everything with an RPA, or an ERP, or a forms tool, or a workflow tool like ServiceNow (yes, I know it does much more), but you can make a heck of a transformation if you architect a solution that uses all of them.  Next, they invest and build their own team.  Why is outsourcing such a bad idea?  You get all these robots and tools deployed and have no idea how to maintain them.  Then you do upgrades to your systems and guess what they all start to break, so you turn them off.  That team needs a leader, yep you guessed it, another unicorn.  This person needs to understand the vision and have a passion you will rarely find. 

Many companies start these conversations with well we have x number of robots in production and telling me all the new software they put in place and that they moved to Workday, blah, blah, blah.  At the end of the day you need metrics to measure the effect of this investment.  I had a company do 10’s of millions in investment only to say to me “Michael we did all this and our experience still sucks”.  Yep, well you led with tools vs. process and without the end customer as the focus of what you were trying to achieve.  Seems pretty simple huh, well 75% of companies are screwing it up. 

Let’s talk about the “partner” communities to all these tools.  From the large of Deloitte, Accenture, etc. to the small mom and pops.  These folks need to sell services, period.  If you go to them and want digital transformation, what will they sell you…. what they offer.  What do you need?  You don’t know, so you trust them and they sell you what they offer.  Go to an RPA partner they will sell you RPA…. not the ERP transformation you may also need in conjunction.  Why?  Don’t they care? Sure, but they don’t understand ERP, nor do they make any money on ERP as they don’t sell services.  Okay Michael but if I use Deloitte, they do it all……yep but that partner selling you intelligent automation may not be connected to an ERP partner.  He is incentivized to sell you his stuff first.   So, they square peg in round hole you and solve it with RPA vs ERP.  You see if you don’t have an independent, educated resource on point for you, you more than likely won’t get an optimal solution.

When I led a team doing this, I first grabbed a quiver (Intelligent Automation) then defined it with arrows (tools).  I grabbed Salesforce, ServiceNow, BluePrism, Application Development, ERP, O365, etc.  Not because I wanted to own all these groups but because my vision required them to be in harmony in strategy to get an optimal solution.  So, tell me, what are you trying to achieve with your “digital transformation” and don’t tell me some generic like reduce costs.  Understand the possible and together let’s paint a picture.  A picture of the future state and then we back up into how do we build that from where we are.  This is the Picasso of your organization not a finger painting.  What does that even mean?  We need expert painters at the table.  I won’t even facilitate a vision meeting without the C level in attendance.  I won’t waste my time, but more importantly I won’t waste yours.

Can this originate from the middle layer of an organization, sure, but that person will need some guidance or hoe the long row on their own.  Don’t get hung up on what the technologies are or can do, first focus on what transformation is necessary for your business.  Think of all the changes in the world, in jobs, in careers, how is that affecting your organization.  There is a great site called will robots replace my job that everyone should check out.  Guess what, if you’re an accountant, the forecast is 94% that you will be replaced by artificial intelligence. Now extrapolate that to your finance department and this is across industry.  How about the changes in medicine where the millennial generation won’t go to a doctor but prefers to interact with AI to diagnose and be treated?  Would you want a computer AI to diagnose your possible cancer or a human?  Take bedside manner (which AI can do) out of it and think it through.  A doctor is often aware of things they read and colleagues they associate with, whereas AI knows everything ever published about cancer.  Add to it that AI can then look at tons more data quickly like genome and family history and produce a treatment recommendation that will include clinical trials that are not known by most physicians. Is this the future of medicine, perhaps a blend of this? But Michael this sounds amazing, why won’t we do this?  Change is hard is my answer and often this isn’t like a technology change but a culture and organizational change.  Change management is the secret sauce to success.  So, in the physician case, often the resistance is from the Dr. themselves feeling second guessed by technology.  More progressive docs see this as a welcome addition and so as time progresses this too will change.

The other interesting observation to be cautious of, is one often employed by our big-name consulting agencies and that is to “standardize” and therefore reduce costs.

I have literally seen them get an application listing and then tell us that we have several applications with duplicate functionality and if we get rid of some, we save money. So glad these first-year college grads reviewed our application list to help us out so immensely. What a useless exercise. I am not a fan of standardizing just to standardize.  It is a dim-witted approach to a complex question. Analysis needs to be done on the use cases, the users, costs, etc. Once that is understood each application can be road mapped.  Stop.  You shouldn’t roadmap an application without understanding the entire application portfolio and the business drivers.  Yes, I understand how large or holistic of an approach that is. However, I challenge you if you don’t do this, you will do all this siloed mapping and not truly affect the business environment. Applications are part of your digital transformation and need to be considered in context with other tools such as RPA, Workflow, PPM, etc.

This may seem overwhelming, but it doesn’t have to be.  It does require you to be “stuck at start” and do more planning than implementing in the beginning. A company I really respect sells an engagement called FOWA or future of work accelerator. This engagement focuses on the work from the beginning to the end and really breaks it down into what CAN and SHOULD be automated. It then estimates and prioritizes the effort.  Why should this be the first step?  If you just start, you very quickly will realize you need more resources, more money, more time, more people and roles and your sponsorship will be left wondering what you are doing and what you are spending money on.  You won’t have a solid business case, and a plan to deliver quick wins along the way.  You more than likely will be running around like a chicken with your head cut off trying to just “do something” and feeling overwhelmed.  Here is my prediction, you will also most likely fail.  Now those that fail will blame the technology, and sadly it isn’t the technologies fault.  Don’t worry it isn’t really your fault either, but it is the fault of a lack of a plan and approach. So, take a breath, call me if you have questions, yes dial a friend, and get a plan together.

Digital transformation is a journey. If your company is looking for a quick fix for your fourth quarter financials, this is not it.  It is a ROI usually within the first year, but not an instant fix. Companies in a fix will more than likely just do layoffs and then also try to start digital transformation as a longer-term fix. This is understandable and my caution is to be careful you don’t layoff the very resources you need to build this team to do the transformation.  Companies really that strapped will honestly struggle to do the transformation. I often say, digital transformation is no longer a competitive advantage but a competitive necessity and if you just pondering it, your competitors are already doing it. So, don’t wait any longer, there are ways to start slow and build, you don’t have to do it all at once, but you do need a plan.

When I said, I am happy to help I am serious. I was you sitting there, wondering how to do this.  Send me an email at michael@gravmetric.com or call me at (602)705-4146.

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