Posted in: Covid19

5 Strategic Traps for Your Digital Transformation Initiatives

The recent COVID-19 pandemic has accelerated the drive towards digital transformation across all sectors globally.

While most of the organizations getting aligned to work from home, most of the organizations have accelerated the digitization of their customer and supply chain interactions along with their internal operations.

Many recent studies have shown focus and intent of top management of organizations to embrace Digital as a key strategic lever to increase efficiency of business as usual as well as explore areas of disruption. While most of these digital decisions had to be accelerated due to the situation at hand, much more quickly that these companies would have anticipated, the Digital Way of doing business is here to stay.

As the world today is going through a Digital Tsunami, Digital is strategy!

If your company is also considering a Digital strategy and committed in allocating resources for using Digital as a key pillar for operational excellence and growth, these are the five key strategic traps that you would need to avoid:

  1. Confusing Digital with IT

Many organizations confuse Digital with IT and assume that all digital initiatives will be led by their IT department. While their IT department leaders must be great at managing technological aspects of initiatives, but most of them also do not have necessary business expertise. Digital needs more involvement of business owners to ensure that strategic value is being delivered across the ecosystem to both customers as well as partners.

  1. Using Old Business Model for Digital Business

Digital businesses demand relooking at transformation of existing business model to the core. While many organizations assume quick shift process automation as digital transformation, they miss our majorly on the fact that digital transformation needs a more holistic understanding of intelligent processes, platforms, products/services and weaving a complete ecosystem while promoting a Digital culture in the organization. With big tech companies taking a strategic position of being a cross-border innovator, competition has started knocking the door for many incumbent businesses. Such a situation would surely need a holistic understanding of the Digital business model.

  1. Ignoring Data Smartness for Decision Makers

The concept of data and what it means for data smart leaders needs a closer look in most of the organizations. While many companies have committed to heavy investments in creating a Center of Excellence for Analytics or have a dedicated analytics workforce, most of the times, the reports being generated by such teams have no takers for business decision makers. While most of the business fraternity would have heard great stories starting like beer & diapers to get better insights, but a sense of ownership with data is missed out in many organizations.

  1. Getting trapped in the Innovator’s Dilemma

Clayton Christen had introduced the concept of Innovator’s Dilemma, first published in 1997 where he had shown that good managers may not always be a good decision maker. Most of the times, good managers only focus on what is generating revenue today and keep their eyes closed on what is about to happen tomorrow; leading to a situation where innovation takes a back seat and experimentation is not encouraged at the fear of failure. Many such companies getting trapped in such dilemma wake up to unprecedented competition that is tough to compete with tribal wisdom!

  1. Prioritizing on the aspect of Digital Mindset and Culture

Digital transformation would need to promote a digital mindset among decision makers and most importantly, promote a digital first culture, so that business leaders can imagine a future leveraging on the key benefits of digital ~ easier said than done, promoting a culture and mindset around digital needs to come ahead of technology. Many organizations get trapped in failing to promote such mindset and culture while committing to invest heavily in technology related initiatives. As many business decision makers are put off by technological jargons, it becomes pertinent for organizations to invest in developing such perspectives among their decision makers.

COVID-19 crisis has accelerated digital transformation initiatives in companies around the globe by many years and senior leadership in organizations have been left with fewer choices than to become serious about leveraging on technology more in the forthcoming days. These strategic traps hinder digital transformation in many organizations, and you should also plan to avoid such traps.

Prof. Rajnish Dass


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