3 Digital Transformation Stats and Facts People Get Wrong

Digital transformation is perhaps the most oft-used call to action in today’s corporate lexicon. We know the most resilient businesses are harnessing it. The coronavirus pandemic has surely accelerated it. You’ll fall behind if you don’t embrace it. But how does a company actually transform digitally, especially when the path isn’t linear? Do we even know what digital transformation stats mean anymore? 

Transformation assumptions stall progress toward digitalization and the microwins that enable teams to accelerate growth and forge ahead.

Myth: Acquiring new tech is the key to digital transformation

Fact: While shiny new tools and capabilities may lure business leaders by promising an easy, quick kick start to transformation, they’re not necessarily the first step.

“Digital transformation has often been reduced to a tool or a technology,” said Nigel Vaz, CEO of global digital company and Salesforce consulting partner Publicis Sapient. “Digital business transformation is fundamentally the idea of reimagining your business, in the truest sense, in the context of a world that is almost entirely digital.” 

For example, investing in new artificial intelligence technology won’t actually transform your business unless you have a thorough understanding of how to implement it across the organization – and how to use it to create measurable value. Buying the latest and greatest tech without evolving your organization’s mindset – its relationship to that tech – leads to disappointment and further bloat. A true digital transformation begins with acknowledging the fact that it can’t be bought, downloaded, or installed. It begins with reimagining the fundamental business practices required to make effective use of that technology in the first place.

“That takes a fundamental shift from trying to build a faster caterpillar to building a caterpillar into a butterfly,” said Vaz, who has advised many complex business transformations with clients across the globe. To undergo that shift, Vaz said to use the acronym SPEED to remember the five key capabilities that companies need to evolve and innovate: strategy, product, experience, engineering, and data.

That’s not to say tech doesn’t matter. To undertake a successful digital transformation, an organization needs to address three pillars: people, process, and technology – and all three need to work together. A survey from MuleSoft in collaboration with Deloitte Digital found that companies succeeding with digital transformation made cloud computing a high-priority investment. Furthermore, the average enterprise has 900 applications, and fewer than 30% of them are integrated – a huge obstacle to the goal of unifying data to support evolving customer needs.

Before shelling out for exciting new tech, set up a solid foundation for change. Start by examining your goals in regard to transformation: 

• What business objectives are you trying to achieve? 
• How will digital transformation add value for your customers? 
• What internal cultural changes are required – and desired? 

Be able to clearly illustrate what your digital transformation looks like and communicate those goals across the company. If you’ve set up the right governance foundation, the latest tech can serve as a powerful catalyst and make your process feel seamless.

Myth: Digital transformation requires a single-minded, unshakable vision

Fact: Tim Cook. Satya Nadella. Marc Benioff. The household names of industry titans often obscure the complex teams and operations that support them. 

The truth is somewhat more mundane: Businesses need support from every facet of the organization, from the entry-level associate to the chair of the board. 

“No single person can drive transformation by themselves,” said Vaz. “You need buy-in from all of the other stakeholders, not just within your company, but in the ecosystem – customers and partners.”

A hundred clones that emulate your executive philosophy do not create the rich texture that’s necessary for real innovation. Stakeholder buy-in is much more meaningful in an inclusive organization. Deloitte research from 2019 found that teams with inclusive leaders were 17% more likely to report that the group was high-performing, 20% more likely to say they made high-quality decisions, and 29% more likely to report effective collaboration.

There are some tried-and-true methods for getting this right: Hire with diversity, equity, and inclusion (DEI) in mind, and integrate well-communicated DEI principles into your organization’s internal mission statement. Without these measures, you may not get the talent you need. A 2021 Deloitte survey found that 67% of job seekers report that a diverse workforce is important when considering a job offer.

Don’t make the common company mistake of stopping with recruitment and hiring. Take a good hard look at your current culture. It’s a common blind spot that could hinder transformation efforts. 

“I would say the most significant roadblock is culture,” said Deborah Sills, principal with Deloitte Consulting LLP and the global leader for Deloitte’s government and public services in­dustry. “Each of us individually are in some way adverse to change.” 

Get input from your staff to determine the process constraints they consistently come up against. Have a third-party or outside stakeholder assess processes with fresh eyes to determine the barriers that have become invisible to those inside the organization. 

One way to shift the culture? Prioritize training. Many companies see training as a bonus rather than a priority, and often it’s the first thing they slash from the budget. However, training is an asset – one that requires investment, to be sure, but one that will pay dividends as your organization grows. 

“If you’re going to drive constant change, you need to bring your people along; they need to be educated and understand and be capable of operating in the transformed environment,” said Sills, who has advised major clients on large-scale digital transformation initiatives. She cites programs like Deloitte’s Greenhouse®, which trains business leaders in transformative thinking and is even used internally by Deloitte to continually evaluate the future of the business.

Myth: Business transformation has a beginning and an end

Fact: Business transformation simply can’t be achieved in one quarter – it really requires a shift in mindset. 

Even hiring and training staff, crucial for transformation, is a complex, long-term initiative. “You have to be consistent and committed to making the change happen,” said Sills. “It can be difficult to stay with it over the years. There’ll be a lot of naysayers, barriers, and obstacles in the way.”

You have to start somewhere, though. Sills recommends choosing a project that will demonstrate success and that is high-profile enough to inspire your team and make waves in the market.

A one-off digital renovation project won’t make waves in the business landscape for long, though. The reality is that true digital transformation requires consistent attention and changes. It’s what Vaz calls “constant beta mode,” a necessary condition for successful evolution. 

“If you think about software and software products, they’re not projects that begin and end,” Vaz explains. “They’re products that are constantly evolving.” He advises executives to ask themselves, How can I constantly evolve on an ongoing basis? This will also require consistent research, testing, and check-ins to make sure you’re affecting the change your stakeholders want and need and not veering off course.

We know the transformation mindset shift is possible – because the pandemic has proven it. Publicis Sapient’s Digital Life Index report found that, globally, 93% of respondents said that they’re spending more or the same amount of time online than they did in 2020.

“One of the things that we really learned through the pandemic is that we can change, and we can change very rapidly when everyone’s aligned around the reason to do so,” said Sills. “I think it is about leaders really buying in to the necessity of continual technology-enabled change to meet the evolving demands of stakeholders and pressures of the market, and then staying the course and building a culture of transformation.”

A survey from Deloitte backs this up, finding that 69% of surveyed digital transformation leaders globally planned to increase their financial commitments to digital transformation in response to the pandemic. That investment in continual transformation will be key for businesses to nimbly move ahead, no matter what’s around the corner.