February 11, 2021 7 min read
Opinions expressed by Entrepreneur contributors are their own.
It shouldn’t be a surprise to hear that taking a company digital is a difficult process. But it might come as a surprise to learn just how difficult it is to achieve a successful digital transformation. According to a Boston Consulting Group study released in October 2020, only 30 percent of digital transformation efforts met expectations, meaning the vast majority of these attempts fell short.
It’s a startling number that might cause business leaders to have second thoughts when considering their own moves to digital. But digital transformation isn’t just advisable — it’s necessary. In many industries, such as renewable energy, the digital shift has changed the entire business model. This means those who can’t (or won’t) transform will become obsolete sooner rather than later.
Going digital is the only way forward for startups and companies that don’t want to be left behind. Despite the intimidating statistics, it is possible to create and follow a roadmap for digital transformation that won’t lead anyone into a ditch. Having just helped my own company go through the process, I know how hard it can be. I also know how rewarding the results are when the change is completed successfully.
What to expect when moving into a digital world
When businesses decide to go digital, the first step is acknowledging that not everything will go as planned — and even when it does, the process will still be hard. Beyond that, employees and management will find themselves dealing with not only their normal tasks but also the new responsibility of learning a different system and migrating data from the old system to the new one. Many solutions will have to be tweaked on the fly, and it’s almost a given that not every team member will be happy with the changes.
However, once completed, the benefits are almost immediately noticeable. In our case, it took us half as long (or even less time) to complete common tasks than before the digital shift. Once they got the hang of the new tools, employees also reported a better work experience. Our entire system became more transparent, more efficient and more secure.
Perhaps most exciting was the feedback we got from customers. We always knew the change would ultimately benefit our employees, but we couldn’t be certain that customers would view this change as an improvement — especially if it affected how they interacted with us. However, we quickly received feedback from many customers who noticed and appreciated an improvement from the old way of doing things.
This isn’t an anomaly. One McKinsey report shows that digital transformation can lead to a 30 percent uptick in customer satisfaction and a 20 percent increase in employee satisfaction. When handled well, a digital transformation can change an entire business for the better.
A four-step strategy roadmap for digital transformation
Because digital transformation is new, there is no tried-and-true gold standard of how to approach it. That said, enough companies have successfully navigated the process that a few proven strategies have come to light. Here are four of the best:
1. Secure employee buy-in from the start
IFS cites a lack of employee buy-in as one of the top reasons for hesitance when it comes to digital transformation. The best way to secure that buy-in is to be open about the process from the beginning. When we first began our digital transformation, we made sure to bring the whole team in on it.
We laid out why we believed this change was positive and necessary, and we explained how it would benefit team members and customers. We asked for their input, and we used that feedback. By making everyone a part of the change from the start, it made asking them to weather the growing pains significantly easier. They understood the benefits ahead of time, and they felt like their concerns were being heard throughout the process.
2. Communicate regularly with employees and customers about upcoming changes
According to another McKinsey report, organizations in which senior managers communicate openly and honestly are eight times more likely to report a successful digital transformation than those that don’t. Communication must be an integral part of the process from start to finish.
To ensure everyone was on the same page during our transformation, we set up a weekly meeting specifically dedicated to discussing the ins and outs. We used this time to update everyone on the latest developments and upcoming changes; we could also hear how both employees and customers were handling everything as we went. We also made sure to send out regular announcements through email and Microsoft Teams, reminding everyone of anything they needed to be aware of in the near future.
3. Gather customer feedback, then build it into the transformation
A successful digital transformation should have clear benefits for customers as well as internal teams. The best way to ensure this happens is to establish a direct, consistent process for obtaining customer feedback.
One way to do this? An increasing number of organizations, including IBM, use the Net Promoter Score (NPS) to gauge satisfaction and solicit feedback. The NPS system gauges how likely customers are to recommend a brand or product, asks follow-up questions about why they gave that score and then tracks the evolution of scoring over time.
This process gives companies greater insight into how customers truly feel about their offerings and what could be improved. In addition to using the NPS system, we ask our client experience team to forward feedback they receive through their regular customer communications to our operations team. That way, customer feedback doesn’t end at customer service — it makes its way into the methods used to get things done.
4. Ask ‘What business will replace mine?’
Leaders should ask this question during every quarterly and annual strategic planning meeting. As technology evolves, so will the answer. Once a digital transformation is complete, that doesn’t mean change stops — it just makes implementing that change easier. It’s still critical to be aware of the ways businesses need to evolve to continue meeting the moment.
Domino’s Pizza is a great example of a company that took digital transformation seriously to adapt to the present times while accelerating growth. As a result, Domino’s outpaced its once-dominant competitor, Pizza Hut, and has continued its upward trajectory. The company has stayed focus on the next step for several years now, helping it thrive in ways it had never done before.
Becoming a digital-first company is more than just putting a fresh coat of paint on an old structure — it’s rebuilding everything from the ground up. It’s no wonder, then, that this is such a difficult process for so many organizations. To find success in such a big change, it’s crucial to have employees and clients on board every step of the way. That way, everyone can work together to carve a path to a brighter, digital-first future.