Monday, March 13, 2023

It’s Time to Become Digitally Fit

Digital transformation as the world knows it is dead. Transforming into a digitally capable organization isn’t just one finite experience or project. You don’t just transform and then stop. That’s where many companies have and continue to get it wrong.

Digital transformation is about people and technology. It’s a relationship-rich journey, not a timeline of transactions. Drawing a parallel to our own health, when people get physically fit, they don’t find long-term success just by going on a diet and hitting the gym for a month, a year. To keep the weight off and gain long-term benefits from the health improvement, they must change their habits, stay fit, and be consistent now and in the future.

Similarly, to gain true value from modernization projects, companies must prioritize their people and work together across their organization and their ecosystem to become digitally fit. How so? Here’s a rundown:

  1. Cultivate a Positive Mindset

Digital fitness starts with a change in mindset and a shift in culture. The entire team must be in the know on goals and embrace the spirit of digitization. At that same time, the culture of the company must encourage a bias for action. It must allow people to try, fail fast, learn, and try again. It must continue to move forward together. Doing so will give leaders and associates a sense of excitement and pride in the organization’s goals.

  1. Evaluate Your Digital BMI

If you’re out of shape and someone asks you to start your fitness routine by running on a treadmill for an hour at 7.0., you’d collapse. Similarly, a company that embarks on an AI project without a solid data foundation will fail. But companies do this all the time. They take on fancy modernization projects and achieve little or no ROI. As you would measure your own BMI at the start of a fitness routine, evaluate your company’s Digital BMI before modernizing.

To determine a company’s Digital BMI, I would ask several questions: How cloud-friendly are your legacy systems? Outdated systems that hamper companies from moving quickly are often what kills them. What is your data maturity? Do you have an omnichannel customer experience? Can you innovate, operate, and integrate at the same time? What is your speed and time to the market? Do you have a balanced portfolio outlook based on value? By auditing where you are today, you can focus on optimal value creation as you digitize and modernize systems.

  1. Focus on Value Creation

Companies often embark on digital transformation projects for PR purposes. “Look everyone—we modernized our apps! We built an AI!” But is there a return on investment, and can you measure it? To get longevity out of your investment and effort, focus on value creation. View it from the lens of a CVO, or Chief Value Officer. Build a financial model to measure outputs. Is the project adding to EBITDA, or expanding margins? Measure the true operational gains from the project. It can be top line or bottom line, but it must drive value.

  1. Create a Digital Fitness Regime 

Now, you’re ready to create a schedule for digital fitness that will drive value. There are four factors to every successful digital fitness regime: spirit, planning, architecture, and governance. The first is organizational spirit—your leaders and team members must share a sense of purpose and pride in the quest to modernize your organization. Identify and rally stakeholders with the operational vision, and cascade that vision with your employees at all levels. The second is planning—create an execution plan that balances risk, current performance, and future transformation. Make sure you perform as you transform—and measure that performance accurately. The third is architecture—do you have an infrastructure that allows for growth and flexibility? Architect your technology so your organization can anticipate and pivot to an always changing market. And the fourth is governance—every organization needs governance to make sure your top initiatives are really creating value. Build for infinite business models.

Becoming digitally fit with a positive mindset, a digital BMI, value creation, and a digital fitness regime can better enable your organization to do several things including create a better experience for everyone, innovate faster and stay ahead of the competition. Don’t digitally transform over a period. Become digitally fit for life.