Digital is at the frontline of change. And, whilst digital technologies continue to transform the economy, today’s successful businesses have to embrace both digital and change.
Over the years, I’ve seen a number of businesses undergo change – or transformation. Time and time again, these businesses come to the realisation that the biggest barrier to transformation is not technology but culture. It’s people that make change possible.
When established businesses are threatened by agile and disruptive competition, it’s easy to see why the focus becomes technology.
But the key to successful change is, in fact, the hardest thing to change – the culture. Getting people to embrace a new way of thinking and acting.
Cultural change relies heavily on top-down leadership. Senior leaders need to lead by example, showing people that the old way is no longer good enough and enabling people to be flexible and willing to consistently adapt to the shifting needs of the business and the opportunities digital technology brings.
People are the most important part of business change. But inherent in change is failure and people fear failure (therefore fear change).
To avoid this, businesses must align around common goals and nurture a culture of experimentation, encouraging people to find better ways to become more efficient, without the fear of failure and reprisal. This alleviates the fear of change, reducing the amount of resistance to new systems and processes.
Data is key to cultural change, too. Adopting digital technologies significantly improves business intelligence and insight, which quickly shifts the power structure in a business. Decisions that had previously been deferred to those with years of experience and “a feel for what the customer wants” are now being challenged with data. And whoever has the data has the power to make strategic decisions.
Equally challenging is the speed at which businesses must embrace digital. Technology is already transforming not just businesses but entire industries faster than ever before.
Business disruption used to take decades – but can now take as little as a year. How? These new style businesses were born in the digital era where agility is the norm.
For traditional companies, it’s impossible to hit reset and start again – transformation is required across every area of the business before technology or culture can change. Very few can achieve inherent agility without help or investment – but as digital transformation continues to make businesses view IT infrastructure in an entirely new way, the opportunity is there to identify infrastructure savings in one area to fuel innovations in others.
Whilst technology will always underpin digital transformation – businesses must remember that there are more important factors that will shape the future: people and the values they possess. People and culture must come before technology to unlock the full potential of digital.