With news last week of a decade-old incomplete $340m federal government transformation, let's talk about Digital Transformation because it seems like every organisation is trying to do one these days. Talk about a buzzword!
According to a 2022 McKinsey & Co study, a majority of transformation projects fall short of expectations, often with profound consequences. A similar report by BCG in 2020 showed similar findings.
Putting aside my personal views around how innovations in technology automatically imply the need for an ongoing state of transformation that doesn't require a 21st century buzzword-y title - why do so many Transformation initiatives fail?
In my experience, there are a few reasons:
- Calling it "Digital Transformation". If you accept that every organisation in 2024 is a technology company, you accept that technology underpins every organisation. This means transformation is really about "Business Transformation", and a transformation program needs to be closely aligned to organisational strategy and objectives. If this sounds like a small difference - it's not.
- Ineffective scoping of requirements. There has to be a clear translation from "wants" to "needs", and a clear focus on desired outcomes rather than existing process.
- Lack of end-to-end business engagement and change management. Despite the gazillionaire techlords constantly building new tech purely for financial gain, the best reason for technology is to help people/organisations achieve better outcomes in key, measurable ways. Great transformations deliver great solutions by engaging with stakeholders and successfully leading them through change.
- Planning a big bang instead of baby steps. Organisations that try to do too much too fast, inevitably fail. These projects take time, and money, and careful planning.
- Dodgy Digital Transformation "experts". Honestly, some of the stories I hear are crazy. There's a massive difference between delivering a report/roadmap/plan, and actually delivering a transformation that realises genuine revenue gains, cost savings or process efficiencies for an organisation. If you're hiring an expert, ask what they actually mean by "delivery", and then ask for references.
I'm sure there are other reasons!
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