CIOs wish for simpler ways to wrangle data and experiment with business models – but change remains hard to scale. Also, it may be time to stop chasing “alignment.”
How to take a cross-functional approach to digital transformation: 4 tips
Some companies adopt a tech-first or business-first approach to digital transformation, but neither works. Consider four tips for cross-functional progress
The paths companies take to digital transformation vary vastly. While business strategies and end goals differ, most digital transformation programs can be stripped down to one of three approaches: tech-first, business-first or a cross-functional merging of the two.
With more than one in four executives rating digital transformation as a matter of survival, according to Capgemini, organizations must devise a strategic path from the beginning. Failing to consider both important sides of such a large, expensive, and time-consuming initiative could have dire results.
What goes into each approach?
- The tech-first approach – Those who have their blinders on for tech upgrades only seek to incorporate new technologies into their existing organizational processes – without considering that those processes may need to shift when making way for technology that alters how they serve the end user.
- The business-first approach – Organizations focused on the business side are missing technologies that could be useful in how they serve their end users. By focusing on transforming their business model or operational structure without fully considering the role technology plays, they’re thinking too narrowly.
- The cross-functional approach – Cross-functional teams that are prioritizing both the business and tech side are the most successful in achieving their digital transformation goals. These teams recognize that tech and business are mutually reliant.
Digital transformation aims to alter your organization’s DNA to yield market-leading products and services offered by means of capitalizing on advancements in technology. Business matters and tech matters are both core aspects of the definition. You can’t have one without the other. You want to put yourself squarely on the path of continuous evolution.
How to move forward with a cross-functional approach
The best way to approach digital transformation from a cross-functional view is to think big. What do you want your end users to encounter in your experience?
The strongest organizations provide their users with convenience and simplicity. Work backwards from there and consider how to provide them with that. Chances are it requires tweaks made to a business model and technology’s help in executing.
Here are four tips to keep in mind as you launch a cross-functional digital transformation initiative or adjust it to create even more value:
1. Create a clear set of goals
Starting out with a clear idea of what your organization wants to accomplish provides motivation and a strong foundation as you begin figuring out how to achieve them. Make sure they’re phrased not just in terms of company payoff, but also what’s in it for the people involved in reaching those goals. Doing so helps team members become emotionally invested in the program. These goals should cover the “why” but stop short of the “how” — trust your team to find their own way to the “how”.
2. Remember that it’s OK to fail
In order to truly innovate, you must experiment with far-fetched and out-of-the-box ideas. Some will indeed fail, whereas others will surprise you with their success. The important thing is you’re encouraging bold ideas, while recognizing that some ideas have to fail on the way to finding long-term innovation. If your culture accepts the idea of failure from the top down, you’re in a strong position to digitally transform.
3. Be honest about the feasibility of your ideas
As your organization explores different ideas, it’s human nature to want to see an idea all the way through. But sometimes the best path is to dismiss an idea, even if you’ve already made progress pursuing. To understand how your organization will meet its innovation goals, every idea needs to meet one of the following fates: keep it, tweak it or trash it. (Remember, it’s OK to fail!)
4. When evaluating ideas, don’t forget the “here and now”
Make sure you investigate and implement a healthy mix of operational improvements that impact your organization’s present activities, as well as strategic initiatives with payoffs based further in the future. When thinking big, organizations tend to focus on more future-based strategic initiatives, but it can be difficult to secure buy-in from leadership and employees alike if there’s a perception that current processes are broken right now. Focusing only on working toward a grand vision for the future doesn’t help foster a sense of progress.
[ Are you leading transformation using an outdated rulebook? Learn the new rules of CIO leadership in this Harvard Business Review Analytic Services research. ]