Want Successful Digital Transformation? Don't Ignore Your People.
When you think of digital transformation, your mind might immediately jump to questions about the right technology, expected outcomes, and cost. But the truth is, the most common error companies make during one is ignoring the people side of change. And it’s an expensive mistake. 70% of digital transformations fail to meet their goals, largely due to people-related factors. That means of the nearly $1.6 trillion spent on digital transformation in 2021, a whopping $1.11 trillion didn’t translate to intended results. Why does this happen?
While technology offers the possibility of massive benefits, it’s not a plug-and-play switch. A digital transformation demands significant shifts in your organization’s processes, operations, and even culture. It can only succeed when the majority of employees embrace new ways of working. To actually realize its potential, you need a workforce that is ready and willing to adapt to change.
How Does A Digital Transformation Impact Your People?
To accomplish any transformation, you need strategies and processes that support your people. They are the ones who will be using the new technology and systems, and they need to be prepared and supported throughout the change. Business leaders must pay close attention to the different ways in which a digital transformation impacts their employees, so they can create solutions that ultimately result in favorable outcomes.
Recognize Employee Fears Of Being Replaced
Employees often feel threatened by a digital transformation in its early stages. They worry they’ll be replaced by AI and automation and end up losing their jobs. As a result, they may consciously or unconsciously resist the change, hoping the initiative is scrapped. If you put yourself in their shoes, this is understandable. McKinsey estimates that by 2030, between 400-800 million people could be displaced by automation and need to find new jobs.
It’s absolutely crucial for leaders to empathize: acknowledge this fear and take it seriously. Emphasize how the transformation will assist employees in doing their jobs better, and make work easier and more interesting. And if the threat of replacement is real, create programs to upskill, reskill, or outskill parts of your workforce so they can adapt. This shows employees that you truly care about them and that the transformation is beneficial for them. They will then be more likely to participate and make the initiative fruitful.
Explain The Rationale For The Change
Before launching an initiative, leadership often spends weeks, if not months, closely analyzing business challenges and considering how a digital transformation can help the business overcome them. You’ve been on an intellectual journey that convinces you of exactly why you need this transformation. But most organizations fail to share this journey with their employees. As a result, employees are forced into a massive change with an unclear (or absent!) understanding of why it’s happening.
Make sure you share the rationale behind the transformation initiative. Explain how both the organization and its employees will benefit. Don’t focus only on the bottom line: highlight the opportunities for growth, development, and efficiency the transformation presents. Address any concerns and objections your employees may have. If you can provide a compelling answer to the question “What’s in it for me?” then your workforce will be willing to put in the extra effort and energy necessary for success. At organizations that establish a clear change story (description of and case for the changes being made) for their digital transformation, success is more than 3 times more likely.
Involve Employees To Reduce Resistance
Digital transformation heavily affects your employees on a daily basis. Too often, change is thrust upon them from the top-down and they have no say in the execution, which breeds resistance. Instead, involve employees in designing the implementation process (for instance, through change projects) and provide a platform for their voices to be considered. When employees generate their own ideas about where digitization might support the business, companies are more likely to report success.
Stave Off Change Fatigue
A digital transformation is no small event. It requires heavy lifting on everyone’s part to roll out the new technology — but that’s not the end goal. Even after you think you’ve completed a big change, like moving to the cloud or implementing machine learning to suggest products, there's still more work to do. The goal isn't to "go live" with something new, it's to keep making small, incremental improvements that help you better serve your customers. In other words, it’s an ongoing process of adapting to customer needs. But if there’s an expectation mismatch, employees are likely to become change fatigued from constant shifts, leading to disengagement and burnout.
Prepare all levels of your workforce to see your transformation as an ongoing process. Set small, project-based milestones so people have a clear roadmap and are energized by each win. Last but not least, involve employees in the change process on their own terms to keep the enthusiasm for change going.
Change Readiness: The Key To Successful Digital Transformation
For any digital transformation initiative to succeed, whether it’s a cutting-edge trend like automation and composable design or a more modest undertaking, it's essential to empower your workforce with the skills they need to adapt to the endless shifts. Treating your transformation like a one-time event won’t get you there. Instead, you need to focus on becoming a change-ready organization, which thrives on continual change as fuel for business success.
Change-ready organizations help their employees develop a mindset that’s open to change and invest in equipping them with the skill sets and tools they need to navigate it with ease. They offer opportunities for employees to drive workplace change instead of simply being affected by it. As a result, they enjoy greater innovation, productivity, and ROI on change initiatives like digital transformation.
Want to be one of them? Volonte is the change-readiness platform you need. Book a demo now.