Successful digital transformation continues to elude most businesses – including those in Asia Pacific. Leaders that I’ve talked to remain hesitant about the region’s digital future: businesses are only seeing a 17% gain from digital investments thus far. In Singapore, arguably Asia’s digital leader, over 26% of organisations have stumbled in their transformation efforts; in high-tech Hong Kong, only 4% of businesses feel ‘digitally ready’. And in Australia, reportedly only 10% of businesses are embarking on any meaningful transformation of their business models.
Of course, there are also triumphs, but why are they outnumbered by failures? I find most transformation efforts falter even before they begin when leaders can’t define the why alongside the what of transformation. To answer both – and ensure greater success – leaders should reconsider how they think of what’s commonly consider the dirty word in business: risk.
From foe to friend
Instead of treating risk as an enemy, consider it as a catalyst – the sort needed to provoke meaningful, lasting change within organisations. Align the purpose of transformation with the real risks faced by your business, like more nimble competitors or rising customer churn. Doing so links transformation to future success, a process that encourages support from the business and reduces internal resistance that so often leads to failure. And by focusing on risk, leaders also gain clarity – of what problems digital transformation needs to solve, and what tools, processes, and data might help in doing so.
Consider the following questions in relation to your own digital transformation process:
- Will the shift to digital unveil new models, opportunities or profitable paths otherwise unavailable to the business?
- What areas of the business will suffer from disruption if transformation fails?
- Will proposed technological investments bring long-term benefits or short-term wins? (Note: one is not always better than the other!)
- Can digital transformation empower the business to make informed and wise decisions?
- How well do our own people understand the risks that we seek to address by digitally transforming the business?
Leaders can in fact de-risk much of digital transformation by focusing on the risks of maintaining the status quo. Establishing the connection between transformation and business risks at the start also moves the process into the familiar realm of business transformation – communicating its real value to your people. But how can we progress from there, and ensure transformation doesn’t incur its own risks at unacceptable levels?
De-risking with data
The simple answer is to use enterprise data to guide every transformational effort. Most businesses are already using data to drive R&D or track customer service levels to some extent: the same methods can be employed for newer, more radical digital initiatives. With data analytics platforms like Domo, data can be pulled from across the entire organisation into a ‘single source of truth’, letting business leaders observe various digital projects, keep them functioning cohesively as a broader strategy, and assess how closely they deliver on business objectives and add true and measurable value to the organisation.
Employees across the business can also use this centralised data to improve their own work or to make informed decisions in other operational areas. We’ve seen businesses, from large ones like Cisco to high-growth ones like Telus, leverage the real-time visibility of their data to provide clarity throughout their organisations, and use that to create well-thought out forward momentum. Others have used that clarity and analytical insight to carry out project strategies that minimise costs of both immediate implementation and future scalability if they prove successful.
I’ll be sharing about those strategies and more at the Domo: Reimagine series, helping business leaders further de-risk their transformation efforts and do more with their data. But even before they reach this stage, leaders should already begin assessing the purpose of their digital transformations, and framing that purpose in the language their people can understand and empathise with in their own roles. When it comes to digital transformation, risk can be an adversary, but it can also be an ally. It’s about time leaders turned it to their advantage.