5 Common Mistakes of Digital Transformations

Written by: Greg Thompson

Essentially every company is engaged in some form of digital transformation—converting what once was a paper-based process into an online, cloud-based, digital process. Customers are demanding online applications, document uploads, electronic signatures, and mobile applications. Intense competition and thin margins create the need for speed and efficiency, which in most cases can best be accomplished in a digital environment. Transforming your business to a digital environment is a much more significant change than a system conversion. Yes, new technology is at the center of the work, but going digital inevitably changes how customers interact with your company and how employees get work done. A digital platform not only changes how (and likely where) work gets completed, but it requires managers to adjust how they manage and leaders to adjust how they lead. Digital transformation is a complex undertaking. We can all benefit by learning from the mistakes of companies who have struggled with this transition.

Here are five common mistakes we see in digital transformations:

1. Weak leader. Leaders need to be empowered and accountable to make the change successful. Resistance will inevitably come at surprising times from unexpected sources. A good leader needs the focus, determination and charisma to see the transformation through difficult times and needs a communication cadence and style that resonates across the organization. Most importantly, mechanisms need to be put in place that enable the leader to receive real-time feedback on how employees are feeling about the change, so resistance can be addressed before it festers.2. The old process never died . A classic mistake is not turning off old systems or old processes. Change is painful, and humans are prone to avoid pain. If the old system and old process continues to run, the new process will inevitably suffer from low adoption. It may be preferable to run the old process parallel with the new digital process for a short period of time, but it is very important for everyone to know the date by which the old system and old processes will no longer be available.Related: How Fintech Is Changing Financial Services3. A bad process got digitized . A digital environment creates fundamental change in how data is entered, reviewed, approved, accessed and communicated. If your plan is to simply convert a paper-based process into a new digital workflow tool, the result will very likely be confusion and very little benefit from your new digital workflow. Take the time to engage your employees and your software vendor in an end-to-end review of how processes should change once you go digital. As Hunter S. Thompson famously said, “Anything worth doing is worth doing right.”4. Unprepared people . Digital transformation will fundamentally impact the daily work tasks for many people in your organization. We know change adoption is highest when people impacted by the change feel a sense of ownership in what is happening and when it happens. Your communication strategy should solicit user feedback and should reflect the culture and communication cadence of your company. Plan to communicate early and often about the nature and timing of the coming change, benefits of the new system to employees and customers. Listen and act on employee feedbackabout how the system can be improved. Focused, hands-on training is critical for every employee who will be using the new system.5. Ineffective testing . One of the most often overlooked aspects of a change management plan is robust testing. Testing should be performed by your process experts, not the IT department or the developers who coded the system. Unless your business process experts test the system, you can expect significant problems during training or after you go live, or both.Leaders of a digital transformation should spend their time focused on people and process during a digital transformation. Don’t fall into the trap of focusing 95% of your leadership efforton the features and functionality of the technology. The technology will do whatever you tell it to do. Spend your time helping employees and customers embrace the changes. Then use customer and employee feedback to continuously improve processes so your company can get all the benefits of a digital platform.