At some point in time, organisations decide to commence one or more program or project under the banner of digital business transformation. Go2Cab shares its hands-on experience to draw your attention to some important reasons why digital business transformation fails. Hope you will avoid them.
Go2Cab highlights seven causal factors which contribute to the failure of digital business transformation. The context of this blog is at a point in time beyond the approval of the budget and high-level decisions based on experience and other factors where the senior management decides on focus areas.
The seven reasons include:
Reason 1 for Digital Business Transformation Failure: Missing or Confusing Reference
After some preparatory work, the reform and digital business transformation commence with a series of workshops, typically lead by facilitators or business analysts. One of the most important reasons that contribute to the failure of the business transformation is the way advisors, or facilitators run such workshops. Most of these workshops commence with slogans set by the leading forum where the audience [aka Subject Matter Experts (SMEs)] are obviously thinking that the experts who are leading will help steer the organisation into the implementation of best practices.
The reality is that neither the leading forum nor the audience has a common reference which defines the so-called “best practice”. The slogans used during such workshops by the leading forum include statements like:
- We are here to provide the process, and you (ie the audience) provide the content.
- You will not get everything you want, but you have a say in prioritising the needs.
- It is all about people as technology and process do not matter, and they can change.
While the generic sample items listed are not wrong, it is constructive to note that there is little or no reference to a set of measurable objectives that will drive the digital transformation. A second missing element is that there is little no written agreement on definitions of terms and phrases or measures used by the leading forum and the audience during the fact-finding sessions. A third missing element is that there are no set detailed criteria that SHOULD be used to assess the success of any change (whether people, process, information or technology) when the digital business transformation is deemed complete. So, what happens next is to collect posted notes authored over a typical period of 3 to 5 sessions (running over several days each), and the leading forum will go away and try to make some sense of the scribble. In almost all cases, and given the selected missing elements, the content and the context of the posted notes reflect the generic nature of the questions asked by the leading forum during the sessions such as:
- What does digital business transformation mean to you?
- Where do you think there is an issue is your day-to-day work as the need for automation or process change?
- What do you produce when you do your work?
- Who gets what you produce and where does it go next?
It is ironic that such questions are so generic, they apply to any domain where the core business was real-estate or fast food or education, or transport or health.
Reason 2 for Digital Business Transformation Failure: Generalization of the Topics
Once the so-called experts who are leading the forum examine the content of the posted notes, and as they have done elsewhere anyway, a series of sessions with numerous PowerPoint slides follow where ALL posted notes are assembled under CATEGORIES which represent the focus areas. Instead of drilling into the details, incorporate the operational dynamics (ie, the moving parts) of the business and asking the right questions, the context and content are yet again, GENERALISED into another set of COMMON LABELS regardless of the business domain. Such categories include:
- Stakeholder management
- Process Streamline
- Forecast and Analytics (Note: of course, perhaps most people involved think of analytics as another bar chart or something shows-up on a screen or a mobile device)
Imagine the situation so far. The content or the context has little or no reference to what the specific best practice SHOULD BE. Of course, by now, new slogan comes up like Target Operating Model (TOM), Concept of Operation (CONOP), Common Operating Picture (COP) and alike. Go2Cab will bet that in almost all cases, the so-called experts have some form of ITSM and a few apps in mind! If and when the content had some level of details because the particular SME TRULY WANTED TO MAKE THE CHANGE, such details are now lost in the generalisation by the leading forum. Also, imagine the overlap and discrepancy between the responses given that the leading forum has little or no knowledge what the business SHOULD DO rather than what it is DOING NOW. Of course, to keep it simple and encourage people to express themselves, “we call things what we like” and “lo-be-hold”, we the forum is producing additional excel sheets to map taxonomy, maturity level, services and capabilities. No one knows where the organisation is heading though!
The next series of sessions focus on “PRIORITISATION” of posted notes under each GENERALISED CATEGORY. The usual scenario is to get fewer people involved and ask them to stick a coloured label that represents, IN THEIR OPINION, the “Significance” or “Priority” of the content of each (or grouped) posted a note.
Such sessions are interesting because in most cases, they involve the senior management sitting together with selected (and perhaps the most) experienced people in the organisation. The reality is that people who understand the context would most likely wait to see the preference of the management and then, they will stick the same colour as a notion of support and agreement. It is highly unlikely that anyone would oppose the management and CHALLENGE THE PRIORITY. Given the situation at hand regarding time and money spent and, given the availability of people, no one can scientifically CHALLENGE ANYTHING since there is no reference to the best practice anyway. Go2Cab commences with the construction of what Go2Cab calls the Business First Blueprint (BFB), there are no measurable objectives, there are no measures of success, and there are no definitions of terms and phrases used by people to express their OPINION. Of course, the smarter people in the room realise that it does not matter anyway as there is no agreement on the definition of the keywords used at the time the posted notes were authored by people who may not be in the room to with the forum to PRIORITISE anyway.
Reason 3 for Digital Business Transformation Failure: Lack of Measurable Objectives
In most cases, organisations do not understand the difference between a STATEMENT OF INTENT and AN OBJECTIVE. The effort spent to execute activities relating to items 1 and 2 above, has been driven by statements like:
- We have to reduce time to “Close” open a “Ticket”.
- We have to become more proactive to enhance Customer Experience (of course, no one has decided what this “experience” exactly SHOULD means!)
- We have to improve our delivery of most important products or services.
Examine such statements, which Go2Cab calls, STATEMENTS OF INTENT. Go2Cab evidence-based decision making does NOT start with items 1 and 2 above. Go2Cab commences with setting one or more measurable objectives derived from or based on the statements of intent.
In some cases, the organisation has well-defined objectives such as clearing an incident or closing an open ticket of severity 1 within a specified timeframe (eg 30 minutes). Let us assume that this is the only reason for the reform and business transformation. Note that there still another very important objective, and that is, the measure for CONSISTENCY which answers questions like how often the organisation should meet the stated, measurable objective? Or, how do we measure such consistency? How to do we know about it? How often SHOULD we know about it? What do we do if something is ABOUT to GO WRONG?
Reason 4 for Digital Business Transformation Failure: Focus on the “AS IS”
Another main reason for the failure is the focus on the present. Every workshop or brainstorm session is concerned with the topic of what people do today. The classical outcome of the business transformation is that a new solution which typically involves some workflow, social media and perhaps some audio-visual technology will be implemented to mimic what happens in the organisation. Given the generalisation of the topics, and in the name of “keep it simple” slogan, as it turns out, the new toys and new screens will make little or no difference to the business transformation barring some inherent benefits like moving to a Cloud-hosted environment, using recent platforms, smart-mobility readiness and alike but there is little or no change to the business operational dynamics. The competition is still two-steps ahead where they are also moving (or have already moved) to a Cloud-hosted environment and have a number of the application running on all smart mobile devices.
Reason 5 for Digital Business Transformation Failure: Opinion Based Decision Making
Organisations do not realise that majority of the effort, and the subsequent outcome during the planning and execution stages of the digital business transformation is, by and large, due to the influence of OPINION of people. People express their Opinions via posted notes or any other mechanism. There is nothing wrong with gathering information via posted notes or interviews, but such opinions are NOT CHALLENGED against a well-defined Business Blueprint (i.e. reference). Typically, politics and the influence of human resource reporting lines take precedence and, the louder voice wins.
Reason 6 for Digital Business Transformation Failure: Using the Wrong Evidence in Making Decisions
In some cases, organisation use some evidence, but it does not realise that the evidence is the wrong evidence. Classical examples of such pieces of evidence are averaging data over some period or showing the percent of “something” or bar charts using classical tools like Excel. Organisations forget that such evidence can, and more often than not, mislead the audience, decision-makers and the Executives. The higher the bar on a chart does not mean that the parameter is more significant. The average is typically calculated with little or no attention to the distribution of data or type of data (whether the numerical or categorical type of data). Organisations fail to recognise the time-delay factor where Excel is an Excellent TRAP. Excel does not and cannot show the impact of a DELAYED INFLUENCING FACTORS until the data is available at many later stages than required.
Reason 7 for Digital Business Transformation Failure: Confusing Causal with Correlating Factors
Organisations do not distinguish between CAUSAL and CORRELATING FACTORS (aka reasons) expressed as the OPINION of the SME. Stating such confusion is not a criticism but a simple fact because the majority are not trained to think about the said difference. Of course, the leading forum is typically clueless and hopeless too. At this point, the executives are more blind-folded than they were before the start of digital business transformation initiative. It is interesting how such reason inadvertently leads to the wrong decisions. One example Go2Cab shares with Clients to explain the context of this reasons goes as follows:
You go to the beach at 6 PM on a hot summer day and ask the ice-cream guys about the sales of ice cream over an 8-hr period at 15 min intervals. Then you go the life-saving team and ask them about the number of attempts to save someone from drowning over the same period. If you plot “Sales of Ice Cream” versus “Possible Drowning”, you find that there is a correlation between people who ate ice cream and those saved from the potential for drowning. The more people ate ice cream (i.e., the higher the ice cream sales), the higher the drowning rate. Sure, there is a CORRELATION but eating ice cream has nothing to do with (i.e. IS NOT CAUSAL to) potential for drowning. Using such wrong evidence may lead the Executives to ban selling ice cream at the beach. Given the DELAYED INFLUENCE FACTOR (i.e. after time “t”), there will be fewer people turning up to the beach which is now, another CAUSAL factor in the reduction of business profits for ice cream outlets, restaurants or general retail.
One simple chart can start a domino effect of making the wrong decisions so quickly which may further mislead the Executives where they may now have COMPETING FACTORS to deal with in an attempt to address concerns of local business owners. The question is how to determine the MOST INFLUENCING FACTORS that will TRULY make a difference in business transformation before you invest large sums of money.
Go2Cab will ensure that you get-it-right first time where we will guide you though Go2Cab Evidence-Based Decision-Making framework to understand better your situation incorporating operational dynamics that are specific to your business. Contact us for a free consultation session.