Digital transformation is all about transforming a situation or problem by adopting cultural change and leveraging digital technology to achieve an outcome.
I am sure many of you heard of Gurmit Singh, the iconic “Phua Chu Kang”. He appeared in the Singaporean movie “Just Follow Law (2007)”. In the 48 minutes of that show, the office air-con was switched off. The Head of Department (HOD) then walks to the administrator at 4:59 PM to get it switched on. The administrator replied that it will take three working days to process and she has to write in. The HOD then asked for a fan instead, again the administrator told her to email, copy her boss, HR, Finance, Estate department and the CEO. I guess most of us will laugh watching that movie but you can’t deny that at times we still experience this in our daily lives. This is a typical office process that is not “customer (employee) centric”.
In recent years, online purchases have become the norm. There are several platforms available based to cater to our interests and allowing us to compare pricing, quality, delivery, timeline and more. Personally, I like to go online to look for something that I cannot source locally/easily. Most platforms enable transactions with a few clicks and manoeuvre you throughout the process with ease from the point of purchase, to integrated payment, to delivery and notification.
Recently, I had my order transacted and there was no progress after several days. The platform provider cancelled my transaction and within few hours, the refund was credited to my account.
Good Customer Experience (CX) translates into business growth, customer loyalty and increase customer retention.
How do you gauge both situations? The second scenario is a hassle-free transaction that enabled a smooth customer experience for the consumer. This is what we called Digital Transformation (DX). International Data Corporation (IDC) interpreted this as a change of customer behaviour that uses the information to shape better customer experiences. In my context, DX is all about transforming a situation or problem by adopting cultural change and leveraging digital technology to achieve an outcome with customer experience in mind.
Now you are convinced your business needs to transform. But where do you start? There are some myths and truths about DX and I like to share the two myths that attracted my attention.
Myth 1: Digital Transformation Is All about Technology
Before we go into this myth, I want to share the key principles of Digital Transformation.
Digital Transformation starts from the organisation’s PEOPLE, employees are the “Driver” throughout the entire DX journey. They will be the one that;
- assist organisations to determine and achieve their business outcome
- assist organisations to be agile and evolve quickly
- focuses on the business ultimate goal, that is to achieve Customer Experience (CX) which translates into business growth, customer loyalty and increase customer retention
- understand the organisation’s challenges, business issues and the potential business outcome they like to achieve
- lead organisation’s digital collaboration to facilitate better communication and Cultural Mindshift
- will determine, tighten or streamline budget and to invest effectively during the digital journey
- ensure the usage of digital data, adherence to data protection and governance
- resolve integration headaches especially having legacy systems with new innovative technologies
- ensure user experiences (UX) on the organisation’s specific tool which is equally important
- cultivate organisations to lead digital, think digital and govern digital
Digital transformation is a long haul and requires a shift of mindset that can only be successful with a supportive leader.
Myth 2: Digital Transformation Should Be Led by Chief Digital Officer (CDO)?
Why do I have mixed feelings about this myth? McKinsey and BCG reported 70% of organisations failed their DX journey regardless of whether they are market leaders or performers. There are many articles that outline DX failures but being a Malaysian, let me address a few areas:
“Coming together is a beginning. Keeping together is progress. Working together is success.” – Henry Ford
Henry Ford, the founder of Ford Motor during the 20th century knew about bringing people together to achieve a common goal. He did not invent the production line; he was instrumental in its development that resulted in increasing production efficiency. Similarly, DX is going to be a long haul journey. Hence, while the top leader is able to define their strategic vision, purpose and clear aspiration – the leader needs to bring the team to work together cohesively. We need to recognise that it defeats the purpose if the Business Leader fails to support the entire long journey.
I echo writer, Joa Bohner. He identified a lack of skilled talent that led to unclear strategy, unrealistic goals, and underestimate risk including employees’ change behaviour as failure to DX. I like to add on, it is an uphill task and a long journey hence it is imperative to have talent who is a strategic thinker, equipped with an empathic mindset, collaborative and able to challenge the status quo. This person needs to be a catalyst of the change process especially addressing the core of DX i.e. the employees cultural and mindset change.
People are the drivers of change throughout your DX journey.
Most Malaysian companies don’t practice SILO organisational structure; most of their employees are multi-tasker and hold multiple hats.
For example, CTO and CIO are often misinterpreted. According to Investopedia, CTO plays a strategic planning role while the CIO focuses more on running and managing the organisation’s IT infrastructure and its processes. CIO also oversee IT regulatory governance, conduct IT assessment, data management, protection and even change. With digitisation, CIO needs to look into ways to integrate the legacy system with data and new technologies. Whereas, CTO is responsible for IT development, working with customers and vendors to improve product development thus increasing business opportunities. I suppose they will be the key person for digitisation.
Some DX drivers I know are practically swamped and challenged with holding multiple hats; they are also tasked to manage daily IT infrastructures, provided with limited resources and coupled with junior resources that need their daily intervention. They struggled as they cannot focus on their mandate.
Jeff Bezos successfully created the Amazon disruption by having a separate team from the existing team that supports the status quo of the business.
DX driver needs to be able to handle undiscussable topics, problems or issues. Schneider Electric’s CIO, Elizabeth Hackenson did it. She led their transformation journey by spending 20% of her day interacting with all pillars, participate in their project meetings. She believes in transparency, openness in discussing difficult topics so all are able to focus on the journey at large.
Simon Sinek’s quote on leadership, “It’s choosing to look out for the person on your left and to look out for the person on your right”. This is very relevant for leaders. While they look into business growth on the left, the leader should also look for the person on the right to drive change during their DX journey.
Therefore, it is necessary to hire a CDO? I do read some job advertisements; companies already started hiring CDO, CIO, CTO, CMO or CHRO to head DX but some outline technical programming skills as minimum criteria.
In my perspective, whoever you choose to lead the journey, this person must have direct access to the top leader, recognise collaboration is crucial, be able to advocate a digital mindset and have the empowerment to address the elephant in the room for Day 2 organisations.
About the Author
Elsie is an advocator of Digital Transformation. She believes that setting the right pace by Lead Digital, Think Digital and Govern Digital especially with the right mindset, is the forefront to embark on the digital journey.
