Why do More Than 30% of Digitalization Projects Succeed?
This article has been written primarily based on requests to dive into the key reasons why many digitalization projects succeed. While there are many pitfalls that lead to why more than 50% of Digitalization Projects fail, I will shed light on the other half of the spectrum and give you the top 5 points that lead to successful Digital Transformation.
Changes and transformations are hard, digital transformations are even harder. There is no question about that. But among the many headlines that tell the story of why so many digital transformation projects fail, there are also succeeding projects.
Below, I will sum up 5 common points that drive successful digital transformation projects.
1st point: Having the right, tech-savvy leaders in place
As mentioned, changes and transformations are hard, digital transformations are even harder. Having leaders who are familiar with digital technologies is one of the key factors to transformation success. This includes leaders who understand the top goals to achieve with the change and which technologies are required to reach the goals.
Having leaders who both understand and are capable of driving the change is a key parameter. Commitment is everything. When people in key roles are more involved in digital transformation change efforts, a transformation’s success is more likely.
However, understanding technology is just one facet of the leadership role. Regardless of title or position, change leaders must connect with the users impacted by the change and keep them engaged throughout the transformation process. Storytelling is a powerful tool in this regard. Leaders need to establish clear change stories to explain the why’s, what’s, and who’s in the transformation process.
2nd point: Develop the right capabilities in the organization
Developing talent and skills that enable and support transformation is one of the most important factors for success. Not only does this support the efforts coming from top management, but it also maps the roles of each department and each individual. Training and development ensure those impacted are able to relate to the coming change and able to see their roles clearly.
By (re)defining the roles and responsibilities of individuals, you’re clarifying the roles and capabilities the organization needs. Take the time to assess skill gaps and plan how to fill them. Looking at the available talent pool inside the organization is a great place to start. What capabilities do we already have in place? Which do we need to develop? Who is best suited and interested in growing their skillset?
It might also be relevant to establish new roles, such as integrators and technology managers. These new roles will help bridge the gap between the traditional and the digital part of the business.
Domain experts might also be needed, like PLM experts to handle the total product record including Part and BOM management or Model-based Systems Engineering, Depending on your goal, experts in Automation, ERP, or even Digital Twin or Industry 4.0 experts may be relevant.
One of the key elements of organizations winning the digital transformation game is having a focus on setting cross-functional or enterprise-wide roles to close the gaps in capabilities between each department.
3rd point: Empowering employees to work in new ways
Speaking of developing talent and skills, digital transformation often requires cultural and behavioral changes such as increased collaboration or customer-centricity to name a few. Organizations must take responsibility for empowering employees to embrace these changes wholly.
Reinforcing new behaviors and ways of working by establishing practices employees can relate to is a proven method to support organizational change. Make sure these new processes are well-documented and accessible to employees. This aspect of Organizational Change Management really helps gets people involved and reinforces understanding the impact of the change. This, in turn, allows the business to be properly prepared.
4th point: Do your tools need an upgrade?
Successful organizations are adopting digital tools to make information more accessible across departments and sites. These tools enable teams, departments, and external collaborators to become digitally self-serving. Self-serving teams save time and extra effort and support data-based decision making.
Remember, when implementing new tools and software, new procedures that include the use of new technologies should also be developed. The keyword here is interoperability. You need to have an infrastructure set up to support how information flows and how it can be translated between departments, companies, and software tools. It is not a piece of software that should run this initiative, but the business and its champions for change. As has been stated time and again – software enables people, but it does not independently create transformation.
5th point: Communication is key
Clear communication is critical during a digital transformation process. In fact, it is key. As mentioned earlier, leadership must have clear change stories. Change stories communicated often help employees understand and embrace where the organization is headed, what is changing, and why the changes are important.
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What are your takeaways?
Do you have experience with change initiatives? What tips would you add to this list to increase success?
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