A digital transformation can be one of the more important moves a company ever makes. It requires not only a change at the process level but also a change in the very structure of an organization. Additionally, it can yield a wide range of benefits in efficiency, improved processes, and more. However, not every company can launch a complete digital transformation, and one of the leading reasons why this action can't be undertaken is because the company in question is just not ready. Identifying when a company is ready for a digital transformation, therefore, becomes crucial to beginning the process.
How to Tell When Your Company Is Ready for a Digital Transformation
If your company is in line with the following concepts, you could be ready for a digital transformation.
The Entire Company Understands the Need for Change. Resisting change can be a severe impediment in any transforming process. Digital transformation is no exception; since digital transformation impacts virtually every part of a business's operations, being resistant to change is a sure sign a company is not ready for a digital transformation. The converse, therefore — not only knowing the need for change is present but actively working toward change — becomes one of the best indicators that the company in question is ready.
The Company is Prepared for an Extensive Process. Impatience is one of the surest paths to failure in a digital transformation. By way of example, the Digital Transformation Agency worked toward a digital transformation of the Australian government for more than 16 months so far, and, at last report, there are still “many years” ahead before the process could be considered complete. While each company — and therefore each digital transformation — is different, a multi-year process is not out of line and must be prepared for in advance.
The Company Understands What a Digital Transformation Can and Cannot Do. Some businesses may discover that a full-scale digital transformation isn't what they need immediately. What the business may find instead is that it requires a smaller-scale digitalization project, which tends to be more focused and delivers on specific goals. Knowing the distinction between the two concepts is vital; a complete digital transformation is far more extensive, and though it can contain digitalization projects, expecting the one to behave like the other will result in disappointment and potential failure.
The Company Has Partners that Support Its Process. Since a digital transformation changes so much of the company as a whole, understanding the impact this has on a business's partners will also be a crucial part of the operation. The digital transformation process itself can create an entirely new value chain — as well as potential new revenue streams — that did not exist before the process existed. A digital transformation can require entirely new solutions, and partners that aren't ready to help on that front may be negatively impacted by that company's digital transformation.
The Company Is Already Using Old, Outmoded Technology. If one bit of technology in a company's purview is old and outmoded, then the possibility exists that several bits, or even the entire technological profile, is likewise out of date. This scenario isn't always the case, but it should prompt a closer examination. If the obsolescence is pervasive, a digital transformation may prove more useful than staging several separate digitalization projects. After all, while the website may be old, unresponsive, and poorly optimized for mobile devices, there may be other aspects in place that work better such as a stronger digital connection to the customer base. Perhaps the demand isn't in place for the customer base to connect digitally. Understanding issues like this can be one of the most significant signs of whether or not a company is ready for a digital transformation.
The Company's Digital Connection Is Tenuous. With so much of business increasingly driven by digital principles, a digital transformation may be necessary to take the fullest advantage of these functions. For instance, companies may not be using the data they collect to actively make decisions. Some here might say a digitalization project to include analytics may be useful instead of full digital transformation, but the cultural change required may make digital transformation more valuable. It takes a clear corporate culture shift to accept the impact of analytics on a business's decision-making processes, a sign of a company ready for a digital transformation. This is likewise true for companies that have a strategy that does not actively incorporate digital technology already, a sign that the culture needs sufficiently accelerated to the point where this is unacceptable.
What to Do to Better Prepare for a Digital Transformation
Keeping these points in mind will allow businesses to better assess if they are ready for a digital transformation. For those who are ready, or for those who would like to be better prepared for the process, getting in touch with us at UTG will help ready businesses for their next steps. At the preceding link, you'll find a free digital transformation checklist to help assess your readiness, and, beyond that, we offer all the necessary tools to conduct a digital transformation as well. This can be one of the biggest steps a business can take; being ready to take it will help ensure you derive the most value possible from the change.