Digital transformation: 8 guiding principles

Successful digital transformation requires a shift in mindset and practices. Base your strategy on these fundamental tenets to position your organization for success
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Since COVID-19, the shift to remote work has influenced many organizations to invest in digital transformation initiatives at warp speed. With little to no time for strategic planning or preparation, the onset of the pandemic served as an accelerator for companies and CIOs to establish new business models that prioritize and deliver efficiency, flexibility, and speed.

With remote and hybrid work now considered the norm, more enterprises are adjusting to this new reality by adopting a digital service mindset and embracing forward-thinking ways to stay ahead and future-proof their business. Even with businesses optimistically moving forward to keep up with the rapid pace of digital transformations, 70 percent of these initiatives unfortunately still fail.

For obvious reasons, the advent of digital disruption since the early 2000s has forced organizations to undergo radical change in order to survive. Businesses that don’t keep up will certainly be left behind. While digital transformation is a journey, it requires a shift in technological, operational, and cultural practices to meet both customer and business needs and to ensure the end-user’s experience remains a top priority. But what are the critical steps involved in making your digital transformation journey successful?

[ Also read Digital transformation: 8 steps to boost your progress. ]

Here are eight guiding principles to help you achieve digital transformation success.

1. Pick a starting point

While many companies have adopted digital technology to transform their businesses, the process can certainly be complicated and challenging. Like any journey, however, you need to decide where to begin. Having a clear transformation story mapped out is perhaps one of the most crucial tips for a successful transformation.

Keep in mind, your digital transformation strategy should be flexible and adaptable. Some organizations choose to start with an IT uplift, digitizing operations, or digital marketing efforts. Since digital transformations are evolutionary and don’t happen overnight, the key to success is recognizing that it requires several steps in conjunction with the right resources and leaders. Without a clear understanding of what the process of a digital transformation entails, you risk setting your business up for failure.

2. Engage the right leadership team

The process of digital transformation is not easy. The executive team you choose to lead it should be digitally savvy and committed to seeing the change happen. As pointed out in a McKinsey & Company study, organizations that employed a chief digital officer (CDO) to support their digital transformation were 1.6 times more likely than others to achieve a successful digital transformation. The executives leading the digital transformation should set clear goals, and your employees should have a clear sense of your priorities, allowing them to understand what you are doing and why.

3. Define your organization’s approach

In this new digital age, there is no one-size-fits-all approach. Develop an integrated business strategy that can maximize value creation for your company. To be successful, your organization’s approach should be practical and able to tolerate recent technological evolutions along with your business environment and day-to-day operations.

There is no one-size-fits-all approach. Develop an integrated business strategy that can maximize value creation for your company.

To craft the right approach, carefully monitor your business environment. Ultimately, to choose the right strategy, leaders may need to execute a combination of a few different approaches for their businesses to operate successfully.

4. Digitize your core operating model

For a successful digital transformation, your organization needs to digitize its core capabilities, including but not limited to all steps of the value chain – from shared functions to the supply chain and the customer interface. Your digital transformation must extend to the end-to-end customer experience design and go beyond just the automation of organizational processes.

5. Identify better and smarter KPIs

Successful digital initiatives depend on transformational leaders recognizing data strategy as a means to achieving measurably better business outcomes. The right KPIs help you track goals and measure success.

Focus on strategic objectives that are important to your team and encourage IT operations departments and assurance teams to start by monitoring KPIs for different types of infrastructure, business activity trends, and volumes. Identifying better and smarter KPIs is an anchor for the rest of the transformation. By defining transformational KPIs, organizations can easily discover where digital transformation is most likely to offer superior outcomes.

6. Recognize the need for data observability

By implementing the right data transformation strategy, you can optimize your organization’s data to be a competitive weapon and a driver of successful digital transformation. Without the required tools that provide comprehensive visibility into mission-critical data systems, you risk stalling transformation efforts.

A crucial step in aligning your organization with a successful digital transformation is to leverage analytics to drive improvements in data operations and optimize all aspects of your business. Data observability is key to increasing reliability along with scalability.

[ Also read Digital transformation: 4 initiatives to start this week ]

7. Create a workplace culture that embraces change

Make sure all employees, including the CEO and CIO, are willing to accept change and embrace the new technology. Setting up an organizational transformation strategy can help create a smoother transition for your organization and its employees.

When you are honest and open about the digital transformation process, you create a more inclusive workplace culture and encourage stronger morale.

In addition, senior leaders should work with employees to ease them into new ways of working. To encourage employees further, managers can proactively communicate the benefits of and the reasons for seeking out a digital transformation. Consistent communication and collaboration across your entire organization are key to ensuring everyone is on board for the change and prepared for new challenges as the transformation goes into effect.

When you are honest and open about the digital transformation process, you create a more inclusive workplace culture and encourage stronger morale. According to McKinsey & Company, organizations that adopted an organization-wide workforce and talent practices had higher success rates. With the entire company feeling a part of the transformation, it will also be easier to navigate unforeseen setbacks and you are more likely to be successful.

8. Find new opportunities for digital growth

To maximize your organization’s digital growth, you need to seek out new adjacent opportunities while simultaneously managing resource allocation before, during, and after the transformation takes place. It is critical to consider where your company has assets to expand beyond the current scope of the organization’s activity to reach other industries.

The pandemic has created a worldwide disruption in the way we work and forced organizations to pivot their business approaches to quickly adapt to a new digital landscape. With digital transformations being a very intense and lengthy project, it is easy to understand why some leadership teams are still hesitant to make the change. However, for those that do succeed, their investment pays off quickly.

[ Discover how priorities are changing. Get the Harvard Business Review Analytic Services report: Maintaining momentum on digital transformation. ]

Ashwin is the CTO and Co-Founder at He is a seasoned technology leader with 15+ years of experience as a developer, consultant and architect for data intensive software systems.