As an international brand communications agency, we work with organisations across all industries – from EVs to AI; education to translation; and childcare to fighter pilot’s underwear – and all levels, from the C-Suite to the shop floor. This gives us a unique perspective of the challenges facing global organisations today. And recently, across the board, these revolve around one thing – the demand for change.
Some 70 percent of all digital transformation projects fail
Of course, the allure of innovative new technology can be seductive with its promise of a silver bullet to efficiency, effectiveness and competitive advantage. However, history dictates that seismic change should be approached with a note of caution. Of the $1.3 trillion of investment in digital transformation in 2020, Harvard BR has estimated that $900 billion did not deliver against stated goals. Elsewhere, it’s estimated that around 70 percent of all DT projects fail to reach their objectives. So, what’s not being solved by huge investment and increasingly smart tech? And how do we reframe this process to unlock the potential advantage?
The one thing many organisations fail to realise is that digital transformation isn’t about technology, it’s about people. And from our experience, all too often brands focus on the digital part of digital transformation at the expense of the transformation part. Which, unfortunately, misses out the human component that ensures that change is successful, seamless, and sustainable and the anticipated value is truly realised.
According to The Futurum Group in their latest white paper, ‘An Enterprise Guide to Digital Adoption’ companies in Western Europe or the US have an average of 200 solutions in their tech stack, of which they’ll churn through 30 percent with duplication levels of up to 80 percent. That’s a lot of data! And you know what? While 50 percent of all collected data isn’t being used, over half of all companies or CIOs expect their workforce to adopt three additional tech solutions each year.
But the most sobering statistic of all? To achieve these results, the average company investment is a whopping £27.5m per year (rising by 50 percent year on year). Based on the 70 percent already cited, this means they’re potentially wasting £20m from their bottom line every year. And no matter what the outlay, if the CEO can’t show that digital transformation has resulted in new business advantages or adaptability for their organisation, then they haven’t really transformed at all.
The toll on the workforce
The other thing those figures don’t show? The hidden cost of failed implementation. While digital transformation is often sold as a means to improving the employee experience, all too often, the opposite happens. Whether due to a lack of training or the sheer effort it takes to manage multiple applications, a 2021 poll found that 35 percent of employees are frustrated by their organisation’s technology, and 44 percent say it does nothing to enable them in their job or in fact, makes their work harder.
This shows the huge human cost of a failed transformation. And in our experience, it’s a toll from which few workforces recover. In fact, a recent MIT survey (Sull, Sull, & Zweig, 2022) suggests that a toxic culture is 10.4 times more likely to contribute to attrition than insufficient compensation!
So, what can we do to negate this? While most organisations focus on the customer experience, the value of giving the same level of attention to the employee experience is gradually being realised. Yes, ironically, it’s the human side of digital transformation that ensures that change is successful, seamless, and sustainable and the anticipated value is truly realised.
As Charlene Li, Chief Research Officer at PA Consulting, says so well: “Not enough businesses focus on the transformation part of digital transformation, and the transformation part has always been about people. This has been the blind spot for so many digital transformation efforts—it’s what a lot of companies are missing.”
And it’s a blind spot which is costing us dearly. Figures show that a people-first approach to introducing new technology can improve your odds of successful digital transformation by almost three times, from 28 percent to 73 percent.
What does a people-first approach look like in reality?
Rather than seeing your employees as a homogenous mass, it’s vital you build profiles of the various demographics within your organisation to understand what all your employees need and expect. Then explore new ways to reach and engage a diverse workforce, leveraging relevant technologies and communication avenues that audiences connect with you can build a culture of trust and empowerment.
Sound like a lot of work? Maybe. But half (52 percent) of respondents in high-performing transformations said leaders understood the needs of their workforce versus only 31 percent of respondents in low-performing transformations. So surely all endeavours to introduce more human intuition into our tech innovation have got to be worthwhile?
There are three critical areas that must be aligned to successfully steer your organisation towards digital transformation success –
- The power of community – for digital transformation to become easier, we must introduce it gradually, creating space for different groups of people across the organisation to process new ways of doing things and feel competent and confident in employing them.
- Emotion – the key to meaningful engagement. Studies have shown that 79 percent of workers reported positive emotions after a successful transformation, some 50 percent higher than before the transformation; while leaders who appeal to their teams on an emotional level – building, empowering, collaborating, leading, caring, and inspiring – are a massive 260 percent more likely to be successful at transformations than those who don’t.
- Winning consensus through the art of storytelling. Aligning your organisation around digital transformation takes more than data. To truly achieve digital transformation, you need your employees to believe in your company’s goals and commit to achieving them. You need to tell a story that they can relate to, which explains how your new strategy will improve business, what’s at stake if it fails, how the change is within their reach, and crucially, what’s in it for them.
The bottom line? Leading digital transformation is all about seeing and creating a brighter and better future. It can’t be created by technology, and it won’t be enabled by software. It requires open communication between you and your employees, a dedication to a common purpose and a culture of innovation.
Not sure where to start? If so, you’re not alone. Which is why we’d like to introduce you to Humaneyes…
Borne from the world of creative consumer advertising, in which everything starts with audience insight, and honed from our work with myriad brands in different geographies, industries and sectors, it’s our proprietary analysis tool designed to examine, analyse, and open your eyes to the impact and effectiveness – in human terms – of your digital transformation project.
Why not get in touch at info@438marketing.com so we can talk you through it?