What should we do if the digital transformation is not effective? We must pay attention to the six “don’ts” in the implementation of the strategy
Don’t transform for the sake of transformation. In digital transformation, we must pay attention to these six “don’ts”.
Text/Wang Jiwei
Last year, an Accenture survey showed that only 7% of companies in China have done a fair job of digital transformation.
IDC data shows that more than 80% of SMEs in China are in the digital exploration stage, and more than 60% of SMEs have insufficient IT expenditures.
This data is even more prominent in Deloitte’s survey data. More than 85% of companies are still struggling on the road to digital transformation.
The data of several institutions all show that the situation of digital transformation of Chinese enterprises is very unsatisfactory.
In fact, many companies not only have difficulty in digital transformation, but also don’t even fully understand what digital transformation is.
Some companies can reverse the concept of digital transformation, but they still don’t have a clear concept of how to do it, what to do, and to what extent.
This situation is also related to the “over-analysis” of digital transformation by some experts and scholars. For enterprises, digital transformation is nothing more than reducing costs and increasing efficiency. However, with the continuous development of new technologies, more and more concepts are involved, and digital transformation is becoming more sophisticated. A cyberspace alone can explain tens of minutes. Concepts such as digital twins have made many small and medium-sized enterprises listen to the cloud, making some companies discouraged and dare not care.
Does this have any direct help for companies that want to implement digital transformation? Yes, but not much, which can be seen from the ignorant expressions of many people.
After reading the speech, I still couldn’t understand it. Even if you understand it, once you see that you invest tens of millions in this solution, you will still avoid it. If the digital transformation solutions have to invest heavily, for the majority of small and medium-sized enterprises, it is better to optimize human resources. More companies want to know how to quickly and effectively carry out digital transformation.
Many people say that digital transformation must start from the strategic level, that is, the boss takes the lead in doing this, in order to ensure that the executive level can promote it thoroughly. Promoting digitalization from top to bottom can indeed ensure the popularization of digital technology in enterprises. However, in terms of effectiveness, most of the projects have a very long duration. Generally, investment is made in the early stage, and no immediate effect can be seen. In the long run, they will be questioned, and some projects will even be suspended in the middle. This is also one of the reasons why many companies cannot succeed in their digital transformation.
Many cases prove that it is not the digital strategy implemented by other companies that is suitable for your company, nor is it that you can use ready-made cases. The informatization situation of different enterprises is very different, and the digital solutions are also different. In fact, with the mature application of various information technology, digital transformation is relatively easy now, and many requirements are not too difficult to realize. With more and more solutions and more diversified technical means, many companies still cannot play digitally.
The reason is mostly that companies still attach importance to the strategic level and ignore the implementation level. If the execution ability is not improved, the strategic planning is useless. If you want to better integrate strategy and execution, you need to choose and distinguish the execution time of various solutions, understand which solutions are implemented first, which solutions are implemented later, and which solutions can be implemented at the same time.
Also, learn to choose decisively, reject unsuitable solutions, and of course resolutely implement good solutions. Wang Jiwei’s channel believes that in terms of digital strategy implementation and solution selection, it is best to achieve the following six “don’ts”.
1. Don’t transform for the sake of transformation
Many companies cannot succeed in their digital transformation. A very important reason is that they started their transformation without thinking about it, that is, they lack the vision and goals of digital transformation.
Some companies are transforming for the sake of transformation, not because of the needs of business development. Some companies feel that they will fall behind if they see the transformation of their peers. Some companies have listened to the data reports of some organizations, overestimated the capabilities of certain management systems, and did not exhaustively sort out the needs, and implemented digital transformation plans at will, and finally broke the beach. For some companies, digital transformation has not only failed to reduce costs and increase efficiency, but has become a burden to the development of the company, and it has been paid for.
Digital transformation is an effective means for enterprises to reduce costs and increase efficiency. However, the development of enterprises is different. It is necessary for enterprises to consider needs according to local conditions in order to introduce more suitable digital transformation programs. Some business models are relatively light, and it may be possible to achieve a good transformation simply by introducing some digital solutions. Some business models are heavier, and the use of very heavy measures may not be able to complete the transformation, and it needs to be carried out in an orderly manner. Other companies may already have a very good operating model, and they only need to further optimize and iterate under the current model.
Does your organization need marketing, commerce, or product digitization? Do you want to create an independent digital product and business department, or start from a certain business process and gradually implement more business digitization? You should think about it before doing it. . If you want to really do a good job in digital transformation, you must understand the core needs of the enterprise in detail, and don’t make the transformation at a glance.
Second, the most taboo is the lack of execution
For digital transformation, either do not do it, or proceed in an orderly manner after starting. The most taboo is the painless implementation. This phenomenon is generally not very effective, let alone successful transformation.
Everyone knows that the introduction of every digital technology will have a big impact on the original business process and management system of the organization. For example, the introduction of business process automation may cause the disappearance of relatively simple positions in some departments, or even the disappearance of some departments. Some departments that are unwilling to be abolished naturally do not welcome this type of digital technology.
In the enterprise organizational structure, the large-scale application of digital technology has enabled many management links to be realized with technology. This will make the organization flatter, and the leadership positions of the original multi-person organization will be eliminated, so that many people will resist, and the degree of cooperation with digital implementation is very low. When multiple departments are not actively implementing it, there will even be excuses.
In the end, many companies can’t push digitalization anymore, and if the boss doesn’t pay attention to it, they won’t be able to do so. Many early corporate transformations ultimately failed in the organizational structure, especially those family businesses. In this case, it is absolutely impossible to have no strong execution to promote the application of digital technology.
3. Do not invest in digitization with huge investment periods and too long
Now everyone knows that digital transformation is not a one-time thing. How many companies that have failed to transform are using blood lessons to tell everyone that without real money investment and sufficient perseverance, they can’t do digital transformation at all.
Therefore, many companies that are determined to carry out digital transformation plan to invest tens of millions or even hundreds of millions of yuan from the beginning, and then implement a digital project that will take several years to complete. What is the concept of a project with a duration of several years? Perhaps a technology worth tens of thousands of years has fallen behind after the implementation of this project. And in the middle, there is generally not much return on investment.
It’s okay for companies to be determined, but if there is only a long-term investment and no periodic returns, large companies with ample cash flow can still afford it, and small and medium-sized companies with average profits may not be so comfortable. Many companies reluctantly halted their digital projects because they couldn’t insist on investing.
In fact, with the development of digital technology, with the blessing of cloud computing, artificial intelligence and other technologies, digital transformation is not as difficult as it was 5 years ago. As long as you find a suitable solution, the rest will depend on how to implement it better. When it comes to the choice of digital transformation solutions, it is best not to choose those with too long construction period and huge investment. It is best to put them into practice while ensuring that they can benefit in real time during the transformation process.
4. Digitalization that reduces costs and increases efficiency cannot be achieved quickly without doing
For every company that wants to transform and upgrade, the use of digital technology for transformation is only a means, and the goal is to reduce costs and increase efficiency. If a company launches a digital project, but it fails to significantly improve its operating efficiency, and even makes the business process more redundant and complicated, such as adding an operation and maintenance specialist for a project, such a digital transformation is obviously unsuccessful of.
A good digital solution may not achieve immediate results, but at least it can achieve certain results in the short term. For example, the cloud of enterprise digital infrastructure can obviously save IT hardware investment, and the greater the business demand, the higher the ROI.Before digital transformation, it is best for enterprises to clarify the transformation focus, so as to select more suitable solutions in a targeted manner
5. Don’t do digitalization that requires continued investment but has little effect
Information technology is developing rapidly, and a new management method may become popular in 3-5 years. Some companies have explored digitalization relatively early. Following advanced corporate management thinking, after more than a decade, many corporate management systems such as CRM and ERP have been launched.
However, more companies do not use these systems effectively. Second, there are data islands between different systems, which cannot connect the data between different systems, and thus cannot better guide business operations through data analysis. During this period, many systems are also being upgraded year by year, and more functions require more investment. But even with more investment, enterprises still cannot achieve the smooth operation of data in all systems.
Then there are some different enterprise management software spanning many years. The heavy investment required to realize automation and intelligence is enough to put on a new information management system, and the ROI still cannot be effectively improved. In this case, the original management software can be completely discarded and a new management system can be re-introduced. Of course, other means can also be considered, such as using RPA and other business process automation software to assist the original system to achieve automation.
6. Do not overdo it in digital implementation
In traditional enterprises, it is normal for the implementation of digitalization to be resisted. And if the digitalization is pushed too hard, it may be too much. Some companies will actively promote and advocate the application of digital technology after they have tasted the benefits of digital technology. Typical examples are marketing digitization and human resources digitization, which can effectively improve precision marketing and human resources management.
When all departments realize that technology can help performance improve, under the advocacy of enterprises, they will rush to introduce various digital technologies to maximize the performance of the department. The easiest way is to develop various applications for different customers and supply chains. Over time, a large number of applications will cause serious data islands. Although everyone is using various APPs to handle their own business, there is no interconnection between the various departments, and it is not much different from the traditional offline business.
Digital transformation must not only satisfy the smooth connection between the enterprise and external customers, but also give priority to ensuring the internal data circulation of the enterprise. Therefore, organizations must pay attention to the “technology flood” situation when carrying out the top-level design of digital transformation, so as not to invest heavily again to solve the problem of data islands.
[WangJiweichannelfocusingonTMTandIoTfocusingondigitaltransformationandprocessautomation】
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