Many companies remain unable to fully adapt to the digital lifestyles of consumers and customers two years into the onset of the pandemic and an ensuing digital transformation rush.
A real-life example is when I recently used a major local bank’s mobile app, which was supposed to send a one-time password (OTP) to my cell phone as an added security measure. I never received any. I tried and tried again that day and even the next day but the OTP function just didn’t work.
Other grocery apps, meanwhile, don’t provide a seamless customer experience: you get a call from someone telling you they don’t have the stock you ordered online.
Covid-19 may have accelerated the shift to digital services, but it has also exposed a major barrier to successful digital transformation: people and culture. Organizations have rapidly transformed their business models and how they interact with customers, manage supply chains and leverage data. However, scaling digital transformation requires team members at all levels to follow the path.
This is where culture plays a vital role. Organizational culture is a set of core values and beliefs of members of an organization, as well as policies and practices such as the treatment of customers and employees and rules about employee behavior.
Culture has been recognized as the biggest barrier to the success of digital transformation initiatives. Through my consulting work, I discovered that characteristics such as lack of innovation, risk-taking, distributed decision-making, and the presence of entrenched organizational silos prevented organizations from successfully implementing digital transformation.
A recent guide from the World Economic Forum (WEF), aptly titled “Digital Culture: The Driving Force of Digital Transformation”, highlights the urgent need to develop and nurture a digital culture given the changes we are witnessing.
“Organizations with a strong digital culture use digital tools and data-driven insights to make decisions and focus on the customer while innovating and collaborating across the organization,” he pointed out. . “When implemented in a targeted manner, digital literacy can drive sustainable action and create value for all stakeholders.”
Digital culture should be collaborative, data-driven, customer-centric and innovative. It is necessary to develop collaboration within the organization and with ecosystem partners to create innovative solutions. Organizations need to leverage data to drive decisions and unlock value.
Customer centricity, on the other hand, is about creating positive customer experiences through product and service offerings and relationships. Finally, being innovative means continually adapting and improving products and processes, taking risks and trying new things.
According to the WEF, a digital culture also helps organizations embed environmental, social and governance commitments and actions across the organization.
Transforming and changing culture is never easy because it requires changing many things: the behaviors and mindsets of employees, the organizational practices that influence them and the company values that guide them.
The WEF prescribes a four-step transformation process, which my company has applied: * Assess the current culture. This is when the creation and empowerment of the transformation office begins. A transformation office is typically a temporary governance and delivery vehicle whose sole purpose is to drive the successful implementation of critical projects and programs that enable an organization to be transformed. This step also covers establishing cultural baselines by collecting data from focus group discussions, surveys, and reviews of policies and procedures. My company uses the six building blocks of innovation for benchmarking.
* Define the target future state i.e. digital mindset and customer-centric culture. This is also where the Digital Competency Model – a set of knowledge, skills, attitudes and abilities needed to successfully execute digital transformation – is designed.
* Experience. This stage involves piloting new programs such as empowering employees, introducing new ways of working, conducting skills workshops, and conducting experiments to determine what works.
* Ladder. This is when digital learning journeys and development programs are instituted across the rest of the organization. New policies are introduced and new organizational structures are put in place. This is when communication campaigns are conducted to institutionalize a digital mindset. Progress is tracked through leadership dashboards.
Implementing these steps requires oversight from the CEO and senior executives to achieve digital transformation success.
The author is the founder and CEO of Hungry Workhorse Consulting, a digital and cultural transformation consultancy. He is a member of the US-based Institute for Digital Transformation and teaches strategic management in De La Salle University’s MBA program. The author can be contacted by email at [email protected]