Digital Readiness: How Prepared Are You?

In this modern era of rapid technological innovation, there is a growing compulsion for organisational survival to incorporate new approaches in the relevant market. Still, the road towards digital transformation is facing numerous impediments. Such initiatives' success depends on the organisation's will to adopt change (Kotter, 1995; Weiner, 2009). This article elaborates on the role of Organisational Readiness Assessment (ORA) in paving the road to successful Digital Transformation. This further elaborates on the central elements of ORA, its significance in mitigating risks, and its place in the strategic fit for digital initiatives contributing to the goals of an organisation.

Digital transformation enables digital technologies in every business dimension to significantly change how organisations operate and create value for their clients (Brynjolfsson & McAfee, 2014; Wamba et al., 2020). It is not simply about a technological shift; it impacts organisational culture, processes, and business models (Shneiderman, 2020). While its potential benefits are well-documented, from increased operational efficiency to enhanced customer engagement, realising these promises demands more than simply deploying technology. It demands that one understands the actual state of the organisation to undertake a digital transformation process. This understanding is attained through the Organisational Readiness Assessment (ORA) process (Armenakis et al., 1993).

Characterising Organisational Readiness Assessment

It is the planned process when an organisation seeks to evaluate its readiness to adopt and eventually sustain new initiatives, specifically those characterised by technological change (Weiner, 2009). Dimensions assessed by ORA in any organisation include culture, the technology infrastructure, commitment by leadership, and strategic alignment (Armenakis et al., 1993; Shneiderman, 2020). The objective is to identify any possible barriers to change, to estimate the organisation's ability to manage these barriers, and to develop strategies that may guarantee a smooth and effective transition.

Key Components of Organisational Readiness Assessment

1. Cultural Readiness: Among all the constituents of digital transformation, organisational culture shines out in many respects. Cultural readiness refers to assessing the organisational setup regarding openness to change, innovation, and the extent of risk-taking (Schein, 2010). It further accounts for the extent to which organisational values and beliefs align with the intentions and purpose of the digital transformation programme (Kotter, 1995). A culture of resistance to change or lacking a vision of where it is heading can bring progress to a complete halt.
2. Technological Readiness: This evaluation includes the preexisting technological infrastructure and the organisation's readiness to integrate other digital tools and platforms. It also assesses whether existing systems can be compatible with new technologies, whether the technical knowledge required is available, and whether the organisation can scale up its technological capabilities (Brynjolfsson & McAfee, 2014).
3. Leadership and Governance: The commitment of the top leadership towards digital transformation provides the drive. ORA evaluates the level of commitment of the organisational leadership towards the transformation process and whether they can articulate the initiative's vision and objectives and lead the organisation in that process of change (Shneiderman, 2020). Effective governance structures must also govern this transformation and ensure accountability (Armenakis et al., 1993).
4. Strategic Alignment: Digital transformation must be aligned with the goals set for the whole organisation. In this regard, ORA checks for consistency between the digital transformation initiative and the firm's long-term goals, ensuring that the transformation does not prove deleterious but serves to attain broader business objectives (Weiner, 2009).
5. Human Capital and Skills Readiness: An entity can leverage digital transformation only by ensuring that the required skills and competencies are within its human resources. The ORA evaluates the current skills level of employees and establishes the gaps that need to be filled. It also evaluates the organisation's readiness to offer necessary training and development (Shneiderman, 2020).

Why Organisational Readiness Assessment is Important in Digital Transformation

1. Mitigates Risks: Digital transformation is usually associated with inherent risk if not managed correctly. Through ORA, an organisation can identify and assess potential risks, be it culture, technological incompatibility, or even skills gaps that will likely throw the transformation equilibrium off balance (Weiner, 2009). Early identification of risk enables an organisation to develop mitigation strategies tailored to the specific identified risks, thus boosting the opportunity for success (Armenakis et al., 1993).
2. Strategic Decision-Making: ORA delivers important insights that inform strategic decision-making. An organisation's readiness for digital transformation can inform leaders' decisions regarding the initiative's scope, timing, and approach. This would ensure that the transformation is feasible and aligns with the organisation's strategic priorities (Kotter, 1995).
3. Improved Change Management: Change management is necessary for effectively varying digital disruption. ORA first pinpoints areas where concentrated change management efforts are needed. Whether dealing with cultural drag, improving the level of technology, or simply acquiring new skills, ORA gives a roadmap for handling this change process effectively (Schein, 2010; Shneiderman, 2020).
4. Resource Allocation: Digital transformation often requires investment in technology, user-centred design, training, and process redesign. ORA helps an organisation efficiently allocate resources by identifying where such investment is most needed. This ensures that resources are directed towards the transformation's critical aspects, maximising the return on investment (Brynjolfsson & McAfee, 2014).
5. Sustaining Transformation Efforts: A digital transformation is not an event but a journey. It ensures that the organisation is ready not just for implementing change but also for sustained change. A preparedness check during an ongoing transformation journey will permit the organisation to adapt to new challenges and opportunities that may arise and, therefore, sustain the transformation (Weiner, 2009).

Conclusion

An Organisational Readiness Assessment is a critical foundation for any digital transformation journey, providing an overall understanding of an organisation's readiness. It pinpoints the troubles and helps in strategic decision-making. ORA is essential for alignment and arming all stakeholders with the impetus for meaningful change, thereby increasing the chances of sustainable success in digital transformation. It becomes more necessary to emphasise readiness assessment as digital technologies rapidly evolve. A readiness assessment investment in ORA prepares an organisation to navigate the complexities associated with digital transformation and fully realise its transformative potential.

References

• Armenakis, A.A., Harris, S.G., & Mossholder, K.W. (1993). Creating readiness for organisational change. Human Relations, 46(6), 681-703.
• Brynjolfsson, E., & McAfee, A. (2014). The Second Machine Age: Work, Progress, and Prosperity in a Time of Brilliant Technologies. W.W. Norton & Company.
• Davenport, T.H., & Ronanki, R. (2018). Artificial Intelligence for the Real World. Harvard Business Review, 96(1), 108-116.
• Kotter, J.P. (1995). Leading change: Why transformation efforts fail. Harvard Business Review, 73(2), 59-67.
• Schein, E.H. (2010). Organisational Culture and Leadership (4th ed.). John Wiley & Sons.
• Shneiderman, B. (2020). Human-Centered AI: Reliable, Safe & Trustworthy. International Journal of Human-Computer Interaction, 36(6), 495-504.
• Wamba, S.F., Akter, S., Edwards, A., Chopin, G., & Gnanzou, D. (2020). How 'big data' can make big impact: Findings from a systematic review and a longitudinal case study. International Journal of Production Economics, 165, 234-246.
• Weiner, B.J. (2009). A theory of organisational readiness for change. Implementation Science, 4(67).