Successful digital transformation in organizations is built on a foundation of strategic goals and objectives.The building blocks are leadership, governance, digital competencies, education and training, and change management. An organization's culture is the mortar that connects and binds everything together. All organizations will be transformed by social and digital technologies - it's a question of WHEN, not IF. Rather than waiting for a disruption that requires revolutionary change, organizations and their leaders are well advised to take an evolutionary approach to digital transformation - and they should start immediately.
Earlier this year I published Digital Era Success: 5 Building Blocks, which described the role of leadership, governance, digital competencies, education and training, and change management in facilitating the successful digital transformation of organizations. I emphasized that each element requires a unique set of considerations that differ from traditional success factors, and in some cases are unprecedented. Many Industrial Era mental models, principles, priorities, and processes are not transferable to or effective in the Digital Era. The digital transformation of organizations - and the people who comprise them - requires fundamental changes and long-term commitment.
Recently I was giving a presentation entitled Digital Transformation as a Human Endeavor, and it occurred to me that I need to extend the building blocks metaphor by adding two more elements. In keeping with the bricks and mortar theme, strategic goals and objectives create the foundation for digital transformation, and organizational culture connects and binds everything together.
An organization's strategic goals and objectives are the foundation of any digital transformation effort and must be established first. Leaders must identify their long and short term priorities, both in general and with respect to social and digital technologies. Some of the longer-term technology-related goals may be big, hairy, and audacious (aka, BHAGs), and not necessarily realistic, but their value should be viewed as aspirational and directional. From there, using a crawl-walk-run approach, leaders can develop a more pragmatic set of near-term objectives that enable them to gradually transform their Industrial Era orientations and operations in ways that reflect Digital Era realities, opportunities, and challenges.
Given all they've seen in the past few years in particular, leaders should recognize that digital transformation is a question of when not if, and they should start to plan accordingly. Why wait for the big disruption and revolutionary change, when evolutionary change is more manageable over both the short and longer terms? Delaying action until the presence of more immediate and critical threats is not in their organization's best interests and could be viewed as a breach of their fiduciary responsibilities.
The majority of organizations today have not yet begun their digital transformation journeys, for a host of reasons. I discuss some of the biggest obstacles to laying a foundation and moving forward in 5 Main Barriers to Digital Engagement.
If an organization's strategic goals and objectives are the foundation of digital transformation, and leadership, governance, digital competencies, education and training, and change management are the building blocks, then culture is the mortar that connects and binds everything together.
Many organizations have moved forward with a variety of digitization efforts, at least from an operational perspective, much more quickly than they have with digital engagement (both external and internal). Although digitization is a necessary component of digital transformation, it is hardly sufficient. Leaders must recognize that the "bigger wins" will come when they integrate social technologies throughout their operations, effectively becoming what is often referred to as a "social enterprise" or "social business."
Cultural components are critical to this aspect of digital transformation. I discuss the necessary cultural elements in What Factors are Relevant to Becoming a Social Enterprise?, highlighting the characteristics that are less important than people think (i.e., organizational type and focus, size, age, financial resources, and workforce characteristics), as well as those that are more important than people think (i.e., cultural values). The key cultural drivers, in order of importance, are:
- Performance values
- Operational efficiency
- Organizational effectiveness
- Financial performance
- Innovation values
- Human capital and communication values
Many social enterprise advocates reverse this order of priority, emphasizing the importance of things like empowerment, egalitarianism and engagement in creating the kind of cultural environment that enables employees to leverage social tools most effectively. As an extension of that argument, they'll emphasize that more hierarchical and command-and-control environments are not only not conducive to social technologies, but that they're antithetical to them.
As well intentioned as these ideas may be, they're a little bit misguided and maybe even counterproductive. The truth of the matter is that social technologies can work perfectly well in more traditional cultures because of the ways in which they can enhance efficiency and effectiveness. Especially in the short term, performance values may be the biggest drivers of adoption, so their importance should be emphasized rather than minimized.
The cultural values discussed in What Factors are Relevant to Becoming a Social Enterprise? are obviously not unique to social enterprises, and that's part of the point. Leveraging social technologies should be part and parcel of an organization's sound management principles. As new tools for doing old things, they should be integrated into the existing culture and mission of an organization rather than being viewed as something that requires dramatic changes before they can be leveraged effectively. (for more on that idea, check out Social Software Implementations: A Judokan Approach to Change)
Many organizational leaders would agree that most if not all of these values are important. But as with any initiative, the leaders have to be able to enact these values, not just espouse them. In other words, they have to be prepared to "walk their talk." As I discuss in Social and Digital Engagement: You Can't Outsource Leadership, they have to make a personal commitment.
Does the metaphor need to be extended further? What other elements do you think are required for successful digital transformation? What additional ideas and suggestions would you offer? What questions and concerns do you have? As always, your comments and questions are welcome.