In today’s fast-paced, technology-driven world, organisations must learn to adapt and evolve to stay ahead of the competition. Embracing digital transformation offers many benefits, from improved efficiency and optimised processes to reduced errors and better customer experiences.
Yet, despite these advantages, many businesses struggle to navigate the complex terrain of digital transformation. It requires a strategic approach, transparent communication across all levels of the organisation, and a willingness to embrace change.
In this update to the blog post for 2024, we will explore the significant barriers that prevent organisations from fully realising the benefits of digital transformation, with insights from Pam Kullar, a results-oriented Transformation Manager with extensive experience leading major transformation programs. Pam has a proven track record of driving operating model transformation through implementing S4 Hanna and Microsoft solutions across business functions like Finance, HR, and Procurement. With a wealth of experience guiding intricate business process changes to ensure technology solutions are aligned with evolving business requirements, Pam brings a unique perspective on overcoming obstacles to successful digital transformation initiatives.
Join us as we share the main benefits of digital transformation along with the causes and strategies for overcoming common barriers to digital transformation.
When discussing the main barriers to transformation that Pam has encountered in her line of work, Pam was animated and happy to share her experiences.
Our discussion delved into the essential building blocks of transformation programs, and our conversation quickly gravitated towards the pivotal role of data. Pam’s keen insight and expertise highlighted how data is the cornerstone for successful transformation initiatives, providing a solid foundation for informed decision-making and strategic planning.
“Data is the fundamental bedrock of any system, and its importance becomes even more crucial when fundamentally changing how an enterprise operates. As companies undergo digital transformations and adopt new technologies, the accuracy and integrity of their data become paramount. Without reliable data, decision-making becomes challenging, and processes may break down. It is essential to prioritise data validation, cleansing, and migration during system changes to maintain continuity and avoid disruptions. Unfortunately, these matters are sometimes overlooked, leading to fundamental issues that can arise later. To ensure a smooth transition and successful implementation of new systems, organisations must recognise the significance of data and take proper measures to preserve its quality throughout the process.”
Pam Kullar, Transformation Program Lead and Tier 1 Consultant
From discussing data, the conversation naturally transitioned into how transformation programs are operated and the critical need for skilled project and change management personnel. Having competent professionals who can navigate these complex processes is essential for ensuring that projects are delivered on time, within budget, and with the desired outcomes.
Skilled project and change management is the cornerstone of any successful transformation project. I am incredibly fortunate to have a team of dedicated individuals who have temporarily stepped away from their regular day-to-day responsibilities to support the project I am embarking on. However, it is essential to note that project and change management skills differ from functional roles. Accountability is crucial to meet our strict milestones, and it is essential to have a competent internal PMO team that can handle any technical challenges and ensure that all tasks are completed efficiently and effectively. Finding skilled professionals who can collaborate with various key stakeholders to communicate upcoming changes and empower leaders to convey these messages can also be a challenging task. It requires individuals who not only possess excellent communication skills but also can understand the needs and concerns of different stakeholders. These professionals play a crucial role in ensuring that organisational changes are effectively communicated and embraced by all parties involved. With the right PMO in place, organisations can navigate through this transformation journey with confidence and achieve their desired outcomes, and this vital area should not be overlooked.
Pam Kullar, Transformation Program Lead and Tier 1 Consultant
As our conversation drew to a close, Pam shared her final challenge in operating transformation programs: talent planning and resourcing. This crucial aspect of business operations involves strategically aligning the right people with the right roles to ensure the success of organisational changes. Talent planning encompasses identifying critical skills and competencies needed for future initiatives, while resourcing focuses on acquiring, developing, and retaining top talent within the organisation. Pam emphasised investing in human capital to drive sustainable growth and innovation in today’s rapidly evolving business landscape.
Resourcing can also be a source of tension and frustration within large-scale projects. For instance, in a scenario where project defects must be addressed promptly, it is crucial to have real-time solutions in place to ensure efficient operations and prevent lag. Fixing defects should not take days, as timely resolution is necessary for the smooth functioning of the project. However, simply adding more people to the team is not the solution. The key lies in finding individuals with the right knowledge and skills to handle the task. This necessitates proactive planning for talent acquisition well in advance. Waiting until the last minute only leads to panic and unnecessary delays. Organisations can effectively mitigate risks and ensure seamless progress by having a team with the right expertise planned.
Pam Kullar, Transformation Program Lead and Tier 1 Consultant
With disruptive technology, economic uncertainty, and intense competition posing commonplace challenges for companies today, our transformation division stands out as a seasoned expert in sourcing top-tier professionals.
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Digital transformation is a powerful catalyst for growth and innovation, providing a wealth of benefits across key areas in various industries. If you need a reason to hit start on your journey, here’s a brief rundown of the key benefits:
Improved Efficiency: Implementing automation solutions can streamline processes, automate repetitive tasks, and reduce manual work, resulting in increased quality, productivity and efficiency.
Enhanced Customer Experience: At the heart of digital transformation lies the customer experience, the cumulative result of all interactions between a customer and an organisation. A successful transformation enhances the customer experience and fosters long-term loyalty and advocacy. Digital transformation enables businesses to understand customer needs and preferences better, personalise interactions, and offer innovative products and services. This leads to improved customer satisfaction and loyalty.
Data-Driven Decision-Making: Technologies, including artificial intelligence, help organisations gather, analyse, and utilise data more effectively, allowing them to make more informed decisions based on real-time insights. https://online.hbs.edu/blog/post/data-driven-decision-making
Increased Agility, Adaptability, Scalability and Sustainability: Digital transformation, fuelled by new ideas, empower businesses to respond more quickly to changing market conditions, new opportunities, customer demands, and emerging trends, ensuring that they remain competitive and agile. Technologies enable organisations to scale their operations, grow, and expand their reach without significant additional investment.
Cost Savings & ROI: By leveraging tools and technologies, organisations can optimise their operations, reduce waste, and lower costs, resulting in improved profitability. An important variable in any digital transformation strategy is the percentage of cost savings. A successful transformation should save 40% of the overall costs; anything less will be inefficient for the entire organisation.
Innovation and Growth: Embracing change fosters a culture of innovation within the organisation, encouraging the development of new business models, products, and services. This drives growth and helps organisations stay ahead of the competition. Digital transformation and innovation are similar concepts; when you’re killing it with one, you’ve set the groundwork for the other.
Enhanced Collaboration and Communication: Digital transformation facilitates better communication and collaboration among employees, teams, and departments, fostering a more connected and efficient work environment with better management and strong leadership.
Improved Risk Management: Digital transformation can help organisations identify and mitigate risks more effectively by providing better visibility, real-time monitoring, and advanced analytics.
By embracing the latest technologies and adopting innovative business models, digital transformation can significantly improve an organisation’s performance, resilience, and long-term success. As you embark on your own digital transformation journey, consider these benefits and utilise the resources provided to guide your efforts.
As organisations navigate the digital transformation journey, they must address several barriers that can impede progress, including resistance to change, inadequate resources and lack of clear strategy. Preparation is critical, so let’s face the obstacles head-on and delve into the most significant barriers that are commonly encountered.
One of the most common digital transformation barriers is the resistance to change among employees and organisational leaders.
People are often hesitant to adopt new technologies and processes, and there are multiple reasons that humans resist change: beliefs of loss (perceived or actual), cultural resistance due to values differences and norms, lack of skills required for the new technology or process, and low satisfaction with an organisation’s mission versus goals. Individuals may also react negatively because their careers have always been structured around current systems and processes, making the shift to a digitally-driven environment feel unfamiliar and threatening. This resistance can slow down or even halt the progress of a digital transformation initiative.
Without a clear vision and strategy, digital transformation projects can become disjointed and unfocused. Organisations must have a well-defined roadmap outlining their digital transformation’s objectives, priorities, and expected outcomes. A lack of clear direction can lead to wasted resources, misaligned goals, and eventual failure of the initiative.
Another common digital transformation barrier is a lack of strong leadership. If organisational leaders are not fully committed to the change and mindset or fail to communicate its importance effectively, employees may not be motivated to participate in the efforts. This lack of support from the top can create confusion within the workforce and hinder progress.
A CEO and CIO are the two most important positions in any organisation, making them crucial to your business’s success. Successfully managing these roles can be difficult even for seasoned executives because they require strategic thinking and adaptability. Digital transformation is no exception—and leaders who don’t understand how it works often miss opportunities along the way and make mistakes that cost their company time and money (or sometimes more).
Phocas also highlighted cultural challenges as a common barrier, citing that for these changes to be executed well, you must have a top-down approach with senior stakeholders bought in and delivering the right message, so the whole organisation can be on board.
Pushbacks equal time constraints, which can make it even harder to kick-start, let alone complete a digital transformation, if the individuals within the organisation aren’t aligned. The key is to have senior stakeholders drive the change with strategic initiatives and keep it a priority until the projects are completed.
Significant investments in new technologies, infrastructure, and personnel are often required to avoid common digital transformation barriers. Limited budget and lack of enterprise resource planning can be a major barrier to implementing the required changes in digitisation, leading to delays or compromises in the process. Inadequate funding can also restrict the organisation’s ability to acquire the necessary skills and talent to apply best practices and drive the initiative forward.
Time and cultural challenges aside, you have to ensure that you have the right amount of budget to invest in the resource – whether this is human capital, technology, or operational support to help execute the change.
Digital transformation often demands new skills and expertise that may not be present within an organisation. This can lead to skill gaps and talent shortages, making it difficult for the organisation to execute its digital transformation strategy effectively. Recruiting, training, and retaining the right talent are essential to overcoming these challenges and successfully transforming into the digital world.
Having the right human resource in a post is the best way to mitigate common digital transformation barriers. The right skill sets and attitudes can help push a digital transformation forward, even in testing times.
Whether you hire individuals on a permanent basis to help drive the transformation or you engage a consultancy or independent contractors to execute your digital project – you must ensure that you have allocated enough budget (even if you have to overestimate) so you can complete your digital transformation with minimal roadblocks.
Time is money, and if key stakeholders and individuals in your organisation who are required to execute the digital transformation are time-poor, you’re already starting on the back foot.
This can create a chicken and egg scenario as you have to start your transformation at some point, but without the right amount of time, you will lose momentum and fall even further behind.
When working with time constraints, your process management and organisation will largely dictate your digital transformation’s success.
To navigate the challenges of digital transformation, let’s explore effective strategies that leverage tech and embrace new ways to overcome common digital transformation barriers.
Establish a well-defined vision and strategic roadmap for your digital transformation initiative. Identify the objectives, priorities, and expected outcomes, and ensure they align with your organisation’s overall goals. Communicate this vision and strategy to all stakeholders to promote understanding and buy-in.
Engage top management and secure their commitment to the digital transformation process. Strong leadership support is essential to drive the initiative forward and to create a culture of innovation and change. Leaders should be actively involved in the process, championing the change and demonstrating its importance to the organisation.
Implement a robust change management plan to help employees understand and adapt to new technologies and processes. This plan should include communication strategies, training programs, and support structures to address concerns and minimise resistance to change. Encourage a culture of continuous learning and growth to support ongoing adaptation. Change management involves mobilising and energising people on a change initiative with low barriers, high benefits, and minimal risk.
Ensure that your organisation allocates adequate budget and resources to support the initiative. This includes investments in new technologies, infrastructure, and personnel. Conduct a thorough assessment of the required resources and plan your budget accordingly, considering both short-term and long-term needs.
Identify the skills and expertise required for a successful digital transformation and assess your organisation’s capabilities. Develop strategies to bridge the skill gaps, such as hiring new talent for your internal team, up-skilling existing employees, or partnering with external experts. Retaining and nurturing talent is crucial to sustain the process and avoiding more common digital transformation barriers.
Establish key performance indicators (KPIs), analytics and metrics to track the progress of your initiative. Regularly review these metrics to evaluate the project’s success and identify improvement areas. Be prepared to adjust your strategies and plans as needed to overcome unforeseen challenges and adapt to evolving business needs. Maintaining an agile and flexible approach will help you navigate the complexities of digital transformation more effectively.
Ultimately, the key to success is to remain flexible, iterate on feedback, and be willing to adapt and adjust the plan as needed to ensure that the project is aligned with the needs of the business and the changing digital landscape. This means that everything is digitised, whether it’s a physical object or a digital one. The benefits of digitisation are immense, but the process can be daunting for businesses and organisations unprepared to meet the challenges posed by this transition period.
The digitisation of business has brought about a new era for businesses. It is estimated that the global market size of digitisation will be around $10 trillion by 2025, directly impacting all aspects of business, including sales and marketing. But digitisation can also lead to solid barriers within your organisation if you are unprepared for its effects on various areas such as strategy, operations, people management and technology.
Navigating the digital transformation journey can be daunting, especially with the increasing demands on organisations today. At The Consultancy Group, our expert team is well-versed in permanent and contract roles within the digital transformation market. We understand your unique challenges and common barriers and are committed to providing tailored, new solutions that align with your goals.
Don’t let the complexities of digital transformation hold your business back. Let us help you find the right talent to drive your organisation forward. Contact us today to discuss your staffing needs and unlock the full potential of your digital transformation journey.
