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Boost Your Digital Transformation Odds
Digital transformation impacts your contact center as well as other parts of your enterprise. In its recent report, “Digital transformation: Improving the odds of success,” McKinsey Digital states that companies that integrate advanced technologies to support digital transformation have a 45% “chance of delivering less profit than expected.” This is a far cry from the best-performing digitized incumbents, which derive about 80% of the digital revenues in their industries, according to the McKinsey research.
The McKinsey researchers point out that most digital transformations are successful based on the business practices that executives choose to follow as they lead their companies through transformation. A well-defined set of transformation best practices increases the likelihood of exceeding the expected profit by more than 50%, McKinsey reports. This is about five times better than those organizations that do not follow best practices, which are independent of the digital transformations pursued.
- Commitment Required — No digital transformation will be effective or successful without time and money being committed to the effort. Implementers should not be distracted by responsibilities unrelated to the transformation project. Success is 1.5 times as likely when a company has devoted time and money to the project, McKinsey found. In the report, the authors also point out that organizations need to reserve sufficient funds for operating expenditures associated with transformation. Those adhering to the resource commitments are 1.3 times more likely to surpass expectations.
- Establish Clear Priorities — Companies pursuing digital transformation should focus on a specific, small number of measurable goals. This will allow for better business outcomes. Organizations that limit the number of projects are about 1.7 times more likely to surpass expectations than those not following the best practices. Digital transformation is more effective when leaders make decisions that are “hard to reverse” but critical to the organization’s direction.
- Invest in Talent — Most companies pursuing digital transformation think about how they’re going to achieve their deliverables. Strong digital and analytics capabilities are necessary, and organizations pursuing transformation will need either to hire for that expertise or develop it internally — or both. Chief digital officer (CDO) is a newer role often associated with digital transformation. In the report, the McKinsey experts point out that all the successful companies have a CDO. Another C-level addition is the chief analytics officer (CAO), charged with responsibility for measuring success and demonstrating delivery on expectations.
- Ensure Agility — Oftentimes companies seek to implement the results from digital transformation as rapidly as possible. However, when they start the digital transformation, they’re looking to the future and making assumptions of what they need to do and how well they will succeed. In the competitive environments of today, the implementation has to be agile enough to support a change in direction based on whether performance expectations are met. Agile companies have about a two times greater success rate than those that are not agile. This also means that employees should be rewarded for creating new ideas and accepting risks. The philosophy should be one of “test and learn,” a process that continues through the implementation.
- Make the People Count — Digital transformation stakeholders should be at all levels in the organization, not just the management tier. Those transformations that are more likely to be effective assign clear roles and responsibilities as well as create an owner in charge. The person who composes the transformation plan should be the owner of the transformation initiative. There should be means of accountability, shared among implementers and stakeholders.
It is not enough for companies to say, “We’re doing a better job.” When a company decides to undertake a digital transformation, it must state clear performance relationships that link the five practices mentioned together.