Digital transformation: 5 mistakes to avoid in 2021

The pandemic has only underscored the need to accelerate digital transformation work. Avoid five common pitfalls
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Today’s pandemic is a wake-up call for organizations. They must recognize that the world has changed, understand the implications these changes have on their business, and identify opportunities to build resilience, fuel growth, and innovate to retain customers long-term.

Savvy businesses are looking to accelerate digital transformation initiatives by doubling down on agile, flexible technologies that can help them compete and succeed amid today’s uncertain climate. 

Launching and scaling a reliable technology foundation is essential to achieving operational agility and overall resilience – both of which are critical to driving long-term growth and gaining a competitive advantage in any market. CIOs and IT leaders are uniquely positioned to take on this challenge and give their organizations the confidence to drive successful digital transformation.

[ Will your organization thrive in 2021? Learn the four priorities top CIOs are focusing on now. Download the HBR Analytic Services report: IT Leadership in the Next Normal. ]

However, the road to digital transformation can be rocky. Let’s dive into some of the most common mistakes companies make when embarking on digital transformation:

1. Lack of strong executive participation

Transformation is hard. If an executive sponsor isn’t passionate, engaged, and committed to making the project succeed, teams are forced to take the easy path, avoiding disruption simply to keep everyone happy and thereby adding complexity.

In contrast, project delays and additional costs can be avoided when that executive understands the project and its impact on business longevity and is willing to help persuade and drive other leaders to ensure the change is successful.

[ How are you staffing your efforts? Read also: Digital transformation teams in 2021: 9 key roles. ]

2. Being too ambitious with the first delivery

Transformation projects need to show progress and a positive impact on the business. Achieving a minimal viable product for the initial launch with a strategic roadmap of sprints is the best way to avoid constant rounds of leadership approval or worse, project cancellation.

When a new system is deployed, new ideas and requests are inevitable. Don’t shy away from that input. Instead, encourage and assess it throughout your project – it may prove useful in your transformation journey.

3. Being wed to the past

People who have used legacy applications for many years will likely see their desired processes as enhancements of the system you are replacing, not the one you are moving to.

The team defining the future state must be trained and immersed in the new tools before any requirements are set. While it can be difficult to shift mindsets to new ways of working, embracing change is critical to the success of any digital initiative. You can take the traditional route of sticking with a formal approval board to review changes and deny customization requests, but a team that fully embraces new tools is more likely to succeed.

While it can be difficult to shift mindsets to new ways of working, embracing change is critical to the success of any digital initiative.

4. Choosing vendors, not partners

Technology should never constrain any business from experimenting with or launching new imperatives. The right tools can enable you, but if you are not getting the most from them you are likely dealing with vendors rather than partners. Your team, or your systems integrator, can never have the same level of insight into a tool as the people who build it. Include partners as part of your transformation team.

5. Hiring for skill sets rather than strategy

Hiring the right people to support your digital transformation initiative is imperative. A resume that features a long list of relevant applications might look impressive, but it doesn’t necessarily say much about how creatively that candidate can drive a new transformation imperative. Find people who can change hearts and minds and lead through all the process, data, and people challenges you will face. Learning a new application is the easy part.

When you’re a technology leader, every day brings a relentless stream of issues and complexities to address. But if you’re too busy chasing down product gaps and escalations, you’ll create barriers to a successful digital transformation and will be vulnerable to an unforgiving market.

Remember, while revenue growth is the underlying purpose of any transformation, the end goal is to enable an optimal customer experience. CIOs and IT leaders have evolved into strategic advisors to support this growing focus on the customer experience.

[ Culture change is the hardest part of digital transformation. Get the digital transformation eBook: Teaching an elephant to dance. ]

Paul Heard is CIO at Zuora. He has over 20 years of Corporate IT experience leading large scale SaaS transformations. Most recently at Micro Focus, a $3B revenue business, Heard initiated and drove the strategy and delivery of a $100M digital transformation, replacing legacy technology applications with an ecosystem of Software-as-a-Service solutions.

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