Decoding the Digirati: Success factors behind leadership in Digital Transformation
4. Model for Digital Transformations – Lead and Execute
In the second edition on the Model for Digital Transformation we explore the three pillars behind Digital Transformation Leadership and Execution, which form part of the set of 9 hidden practices at which digital leaders excel.
Influence Through Digital Leadership
Current research supports the view that the most successful transformations are all driven ‘top-down’. However, if your Chief Technology Officer (CTO), Chief Information Officer (CIO) and Chief Marketing Officer (CMO) are pulling in different directions in the digital aims, your transformation will be facing an uphill struggle. As with any transformation programme, unambiguous role clarity is key to success, but this is often magnified with Digital Transformations due to the lack of an existing Digital Leader. All divisions will need to play some part, so broad senior representation on the Steering Group is good. Shared programme sponsorship, however, is not. In our experience, clear accountability (and budget) is best vested in a single person – whoever that is – rather than split between business and IT leaders as we have seen in some cases.
Regulate Pace of Implementation
If you are to avoid change fatigue, your digital transformation needs to be broken down into manageable implementation stages. The difficulty is that the more substantial the investment, the more impatient managers and shareholders become without instant results. The scale of your ambition and your underlying organisational change maturity are the two key factors that will determine the implementation tempo that is right for your programme. You will need to craft the roadmap carefully – how can you leverage existing digital assets to deliver quick wins? Where do you need to build new digital capabilities?
Given that the latter will require a degree of process and people change, it is wise to think of your transformation in terms of a number of transition ‘states’ that your organisation will move through, rather than as a continuum of flux. This helps to stake stock of what’s working and what’s not, and to celebrate the intermediary milestones along the way.
Adapt and Iterate Digital Delivery
In trying to break new ground – for example when engaging customers in innovative ways, implementing new technology, or introducing different ways of working – mistakes and setbacks are inevitable. A degree of ‘controlled failure’ should be expected. Happily, many digital innovations lend themselves to rapid and cost-effective experimentation on a small scale. Decide which of your initiatives could be piloted and accelerated into a controlled live environment with customers and then – once tested and refined – quickly scaled. For example, well-executed Agile ‘sprints’ can release tangible new digital capabilities to the organisation at regular delivery intervals, building crucial momentum for the transformation.
Even with a blended delivery approach, good governance and control are vital to ensure the right information reaches decision-makers at the right time. Whatever oversight arrangements you deploy – for example a centralised or federated model – it is a question of balance: ensuring sufficient visibility and control without stifling the autonomy and innovation of individual delivery teams.
Govern Digital Investments Holistically
For most businesses, true digital transformation requires significant investment; steel yourself for this. The problem is that too many executives ring-fence their digital budget for new gadgets, ignoring the requisite funding for implementing the process and people changes essential to fully exploit new technologies. Digital investment and risk need to be managed holistically at the portfolio level. The best proven approach is to establish an enterprise-level portfolio of digital initiatives that collectively deliver the digital vision and that can be crisply translated into a set of measurable strategic outcomes and Key Performance Indicators at a business-unit or customer segment level. Unfortunately, this requires an advanced maturity in portfolio management that only a handful of businesses can justifiably claim.
We worked with a major FTSE organisation to deliver a large-scale digital transformation programme that, in previous guises, had had many different IT and business sponsors. Among several changes adopted on the programme, the E-commerce project teams successfully introduced new Agile/Scrum delivery methods mid-way through development of the new sales website, leading to better collaboration between onshore and offshore development teams and earlier involvement of business experts in the design process. While this was a significant change in approach for some teams, the programme has retained a blend of iterative and ‘waterfall’ project management practices (appropriate to the different technologies and processes being implemented), with a strong central Programme Management Office providing visibility of overall status, risks and recommended interventions.
In the next update we explore the final edition in the Gate One Digital Transformation Model in “Model for Digital Transformations – Evolve and Sustain “.