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It’s the word that we hear all the time in business.
The world is always changing. So companies need to change with it, or else. Andrew Grove, the legendary CEO of Intel, famously put it this way, “There are only two types of companies—the quick and the dead.”
There are moments when however painful it may be, the new must be embraced because technology is always moving forward. The consequence of not evolving is the risk of being left behind. And starting too late can be no different than not starting at all when it comes to digital transformation.
Blockbuster is one cautionary tale about not addressing change. Not only was Blockbuster challenged by startup Netflix, but also by technology companies like Apple and Amazon as well as cable companies with streaming and video-on-demand services. It struggled to compete against them all. Blockbuster needed to shift away from its brick-and-mortar approach but wasn’t willing to make a change until it was too late. By the time Blockbuster tried a DVD-by-mail service, Redbox-style rental kiosks, and online streaming it was already game over. Transformation can happen very quickly, and if you miss it, it can be very unforgiving.
Conversely, AT&T is an example of a venerable company that has been nimble enough to navigate through the difficult journey of digital transformation. A key element to AT&T’s success was recognizing the need for an experienced partner, Udacity, that could help the telecom giant rethink the future of work, and then provide the training needed for the existing workforce to be prepared for their transformation from being a telephone company to a software-defined and data-driven organization.
Organizational digital transformation is always challenging. Even the savviest leaders can’t fully anticipate future technology and market changes. But AT&T is an example that it can be done – and remain relevant in the marketplace. To navigate the changing landscape, a company must be able to adapt quickly – even while never taking an eye off the ultimate prize.
With that in mind, you should consider building four capabilities:
Strengthen your operational backbone
If you hope to become digital, you must have an accurate, accessible customer and product data, disciplined end-to-end transaction processes, and transparency into customer transactions.
Encourage quick experimentation
Digital innovation is a company-wide project. You must engage people throughout the organization in a variety of innovative ways like local product enhancements, innovation fairs, hackathons, incubators, and creating digital business units. It’s never clear what will catch fire with customers. So, you need to experiment. That’s when you’ll find your answers. It’s ok to try and fail fast, but what works will drive exponential outcomes.
Support and prepare your workforce
Digital transformation is a journey your employees will take with you. Make them your partners so they truly understand both what is happening and their role in the transformation. Technologies like IoT, AI, Machine Learning, and Data Sciences have attributed to these transformational changes and have challenged the status quo of the way we work. A company is going to live or die by the speed at which it can urgently bring on skilled professionals. As organizations increasingly adjust to this new environment, adoption plans are being hampered by the shortage of people with relevant skills. That means preparing employees for the changes of tomorrow. But before that can happen, employees need to understand what’s expected of them as the company begins to “grow” a more technologically savvy workforce from within. When done properly, employees won’t feel threatened but instead will feel more empowered by the new skills they’re learning.
Build a data-driven decision-making culture
“Fail fast” isn’t just a pithy catchphrase. Experimentation is valuable only if you quickly halt failed experiments and build on the successful ones. For that, you need a culture of hypothesizing, data gathering, and quick analysis to interpret test results. That culture must begin at the top of the company. The payoff will be accelerated decision-making and responsive processes.
It’s true that you can learn from the mistakes of others. But when it comes to digital transformation, the world is moving too fast to wait and learn from other companies’ experiences. You may end up too far behind your competitors to catch up.
Change is often scary.
But consider the alternative. We all know what happens when we don’t embrace change.