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Why does digital transformation not deliver?

by Innovationbubble | 5th February 2018 | posted to Insights

Up to 84%1 of digital transformation projects fail to deliver their expected benefits…and it is no secret.

Across all industries, digital transformation is not a choice for incumbent players, it is a necessity. Yet, the uncomfortable truth is that at the outset of a digital transformation programme, the odds are stacked against successful delivery.

This failure rate is widely recognised; even accepted as an inevitability. But in real-terms, failure on such a level equates to tens of millions of pounds of missing ROI. Why does it happen and what can be done?

 

Success factors and common pitfalls

Given its complexity, there is no question that delivering digital transformation is difficult.

Building on decades of research, plus many recent case studies of real-life success and failure, there is consensus regarding a number of critical success factors. For example:

Digital transformation is a human process

Here’s the thing that many organisations miss, often by accident:  even in technology environments, it is human needs and emotions that primarily drive decision-making2 and determine engagement with change initiatives3.

So, to enable successful digital transformation, programme leaders must understand the human dynamics at play, at a deep level.  They must also be expert at channelling these dynamics, in constructive ways.

Some leaders do not grasp the fundamental importance of such human issues.  Mistake!

Others do appreciate the value of such human insights but cannot readily access them, because they are reliant on conventional approaches to stakeholder research and company culture change.

 

How Innovationbubble can help

As trained Psychologists, we understand the needs and non-conscious brain processes that drive most human decision making and behaviour.  We have developed innovative qualitative and quantitative methodologies to access this insight – insight that is beyond the reach of conventional stakeholder research.

We can help you to better understand key issues, such as:

  • How your stakeholders really feel about your digital transformation programme (not just what they tell you).
  • What hidden cultural factors may limit your success and how you can address them.
  • How you can optimise adoption and ongoing ownership of the transformation agenda.

 

What next?

If you are involved in leading digital transformation, either in-house or in a consultancy capacity, we can help you to deliver improved ROI on your programmes and would love to talk simon@innovationbubble.eu

 

Three take-aways for digital transformation programme leaders

 

  • Don’t believe what your stakeholders tell you (at least, don’t take it on face value):

 

Extensive psychological research has demonstrated that it is nonconscious brain processes that primarily determine human behaviour.  So, if you really want to understand your stakeholders, you need to understand their deep (and often hidden) needs, feelings and motivations.

 

  • Remember that digital transformation is fundamentally a human process:

 

We define digital transformation as ‘the process of embedding organisational change, leveraging digital technologies and business models, to transform business performance and competitiveness’.  

Enabling and sustaining such transformational change requires strategic investment in people – building insight into their core needs, feelings and motivations; offering support which enables them to flourish in a more dynamic, digital environment.

 

  • Be a brilliant listener:

 

Long before digital transformation projects derail, the warning signs can be there to see.  But often, the company cultural context conspires to prevent the red flags from being seen and acted upon.

Strive to create an environment where realism is rewarded, not blind optimism.

Nurture a culture of empowerment, which enables bottom-up solution finding.

References:

1 – Why 84% of digital transformation projects fail. Forbes, January 2016; 84% of companies fail at digital transformation.  IBM Blog, February 2017

2 – Lerner, Li, Valdesolo & Kassam; Emotion and Decision Making; 2015

3 – Kiefer and Muller; Understanding Emotions in Organisational Change; 2003