Blake is the author of two books on customer experience. A survey of 1,600 business and IT decision makers conducted by Forrester revealed that 22% are still investigating digital transformation or not transforming at all. The goal was to build digitally enabled cars with enhanced mobility. All Rights Reserved, This is a BETA experience. She is the author of the new book "The Customer Of The Future: 10 Guiding Principles For Winning Tomorrow's Business" (HarperCollins). In 2014, classic American car company Ford attempted a digital transformation by creating a new segment called Ford Smart Mobility. The CEO was soon asked to resign by the board. It’s also a normal response to being investigated, especially when the problem we are being questioned about could be us. GE Digital quickly became stuck in the pattern of having to report earnings to shareholders and was focused more on short-term goals and earnings than long-term innovative goals and returns. Blake is the author of two books on customer experience. Flip the odds. But the brutal truth is that at the outset of a digital transformation program, the odds are stacked against successful delivery. Featured Insights. Up to 84% of digital transformation projects fail to deliver their expected benefits. As noted by research firm Gartner, however, there’s a growing transformation disconnect: talent. P&G likely could have seen more success if it had focused on smaller digital efforts that were more targeted to its existing products and processes. Nurture a culture of empowerment which enables bottom-up solution-finding. Enabling and sustaining such transformational change requires strategic investment in people–building insight into their core needs, feelings and motivations and offering support which enables them to flourish in a more dynamic, digital environment. The academic research is really clear that when corporations launch transformations, roughly 70 percent fail. (Adobe & Econsultancy) 2. But the transformation goal is often defined as the implementation of a new system, process or operating model which is static and does. Others do appreciate the value of such human insights but cannot readily access them because they are reliant on conventional approaches to stakeholder research and company culture change. Why do so many businesses struggle with digital transformation? $83M+ Raised And Counting In 2020: Are Twitch Streamers The New Philanthropists? As Ford dumped huge amounts of money into its new venture, it faced quality concerns in other areas of the company. You may opt-out by. Coupled with a slumping economy, P&G faced problems from the start. Digital transformation technology strategy. Understanding what went wrong with the following three companies can provide guidelines of things to avoid and point future digital transformations in the right direction. Corporate Punk, the business I lead, works with leaders who know that adaptable organizations win. However, many digital transformations begin on the wrong path. Lacking a clear definition of digital, companies struggle to connect digital strategy to their business, ... on average, of digitizing markets. A digital transformation is a complicated and risky endeavor. Many … Opinions expressed by Forbes Contributors are their own. Lesson: Look at the competition. FDA Authorizes A Second COVID-19 Vaccine. Such factors are already well understood and can be managed, yet a huge proportion of businesses struggle to do so. It’s important to note that although these companies failed on their initial digital transformation efforts, they were able to make adjustments to succeed in the future. When done correctly, it can lead to amazing, future-proof results, but when done incorrectly it can be extremely costly and embarrassing for the company. 1. Some are getting it right and others struggle. I am a Customer Experience Futurist, Author and Keynote Speaker. Blake's clients include Comcast, Genentech, Accor Hotels, Accenture, Parker Hannifin, Ericcson, Omron, Verizon, Adobe and more. Nurture a culture of empowerment which enables bottom-up solution-finding. But often a company's cultural context conspires to prevent the red flags from being seen and acted upon. In 2012, consumer packaged goods giant Procter & Gamble set out to become “the most digital company on the planet.” The company was already leading the industry when it decided to take things to the next level with a digital transformation. Here’s the one vital thing that many organizations overlook: even in technology environments, it is human emotions that primarily drive decision-making and determine engagement with change initiatives. 3 reasons digital transformations fail. It failed to look at what was going on in the industry to see it was already ahead of competitors and what was going on with the economy. 34% of companies have already undergone a digital transformation. Digital transformation, which is the integration of digital technology into all aspects of a business, is a $1.7 trillion industry and yet 70% of all digital transformations fail! specific business functions and framed in an unclear or uninspiring business vision. This makes it difficult to understand the reasons for behavior and people tend to make things up when asked to explain themselves. Below are some of the digital transformation barriers met by some businesses: There is no digital transformation strategy in place; Lack of digital … Yet, most companies are failing to make the transformation. Up to 84% of digital transformation projects fail to deliver their expected benefits equating to colossal missing ROI, as well as the collateral damage to business strategy, shareholder value and team morale. equating to colossal missing ROI, as well as the collateral damage to business strategy, shareholder value and team morale. With all that in mind, here are four recommendations for digital transformation program leaders. Let’s … Program resources and knowledge dissipate rapidly when post-launch testing is complete. But disproportionate focus ends up being placed on the development and delivery stages. The return on investment for a widespread and expensive digital transformation was small, especially with signs on an economy on the brink. October 23, 2019. Create targeted multimedia experiences that reach different groups. For those companies that didn’t fail outright, only 16% saw improvements in their performance and ability to sustain change over the long haul. So, if you really want to understand your stakeholders, you need to understand their deep (and often hidden) needs, feelings and motivations. 1. A failed digital transformation doesn’t spell the ultimate end of a company, but it can be incredibly costly in lost money, resources, time and credibility. Forty-five percent of companies reporting a positive business impact of digital transformation … Blake is the host of The Modern Customer Podcast and a weekly customer experience video series on YouTube. In this case, digital transformation as less of an actual transformation and more of a pivot into a new business area. Some leaders simply do not grasp the fundamental importance of such human issues. Basically, one in eight got it right … However, the sad truth is that 70 percent of all digital transformations still … Such factors are already well understood and can be managed, yet a huge proportion of businesses struggle to do so. For example, Forbes says, “84% of Companies Fail At Digital Transformation.” 2 A recently published Harvey Nash/KPMG CIO Survey points out that only 41% of companies have an enterprise wide digital … Another review of the state of digital transformation estimates nearly 84 percent of companies appear to fail at it. Be absolutely clear about what it is you’re trying to transform. She is a contributor to Forbes and the Harvard Business Review. That compares with only 5 percent for digital … Ford’s stock price dropped dramatically, and the CEO stepped down a few year later. Lesson: Integrate digital transformation efforts with the rest of the company. She lives in the Bay Area with her husband, their two children and two dogs. It must consider all outside factors and be tightly tied to strategy. Her first book was 'More is More: How The Best Companies Work Harder And Go Farther To Create Knock Your Socks Off Customer Experiences." In our survey, just 5% of those companies involved in digital transformation efforts reported that they had achieved or exceeded the expectations they had set for themselves (vs. a success rate of 12% for … Blake Morgan is a customer experience futurist. The digital transformation failure at Ford shows the importance of a unified approach, especially at companies … The CEO was soon forced out. Traditional research, such as asking employees or customers for feedback, often doesn’t take into account the fact that most decision-making is nonconscious. We succeed by dismantling the very human barriers most consultants avoid, and unlocking invaluable human potential. To be successful, digital transformation needs to be integrated into the company. Companies decide that they need to embrace digital … Many companies have endeavored on digital transformations, only to hit roadblocks. They must also be expert at channelling these dynamics in constructive ways. Strive to create an environment where realism is rewarded, not blind optimism. It’s digital transformation, how hard can it be? The lone wolf mentality. Transformation. Couchbase previously reported that 54 percent of companies expect to fail if they miss the impending digital transformation … Long before digital transformation projects derail, the warning signs can be there to see. © 2020 Forbes Media LLC. Remain connected to that ambition throughout your digital transformation program. In 2011, GE started a major effort to assert itself in the digital software space by building a huge IoT platform, adding sensors to products and transforming its business models for industrial products. The root causes of those failures are straightforward. Remember digital transformation is fundamentally a human process. She's worked with Accenture, Intel, Verizon Wireless, and many more. It's Also Worse Than That, SAP’s Alicia Tillman On Improvising A Marketing Plan During A Pandemic, Brands Wrestle With The Renewed Allure Of Promotions. 21% of companies think they’ve already completed digital transformation. Here’s the one vital thing that many organizations overlook: even in technology environments, it is human emotions that primarily drive decision-making and determine engagement with change initiatives. So, if you really want to understand your stakeholders, you need to understand their deep (and often hidden) needs, feelings and motivations. They’re itching to get change moving and they’ve seen that traditional consultancy just doesn’t cut it. James Macaulay Executive Education March 30, 2019. She is the author of the new book "The Customer Of The Future: 10. The consequences for firms that don't adapt could be severe. To enable successful digital transformation, program leaders must understand the human dynamics at play at a deep level. 70% of companies either have a digital transformation strategy in place or are working on one. Digital transformations are often done best with a handful of passionate people leading the charge instead of thousands of employees. They’re itching to get change moving and they’ve seen that traditional. Digital transformation can be defined as "the process of embedding organizational change, leveraging digital technologies and business models, to transform business performance and competitiveness." * Smart Insights 44% of companies have already moved to a digital-first approach for customer experience. 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