Digital Transformation: Are You Ready?

Innovation. We know what it means and what it’s already done for our world. Technology that used to be the stuff of dreams and movies are now the norm. Yet, many business leaders still haven’t acted quickly enough to sustain – and grow – their companies in the digital age.

Why?

Every CEO runs his or her company differently. Experience, background, personality, long-term vision – these elements combine to carve a unique path of leadership in every organization. One thing that is an absolute must in today’s business world is digital transformation. A CEO has to focus on the digital world, considering how their company can take part in it and ultimately, lead their team to success.

A Blockbuster of a Lesson

Some business executives haven’t put resources into transforming their organizations and products for the digital age. Remember Blockbuster? The famous video rental company went bust in the early 2000’s after refusing to adapt to changing consumer demands. Analysts and industry experts predicted that customers were going to want digital viewing from home, causing video rentals to significantly drop.

Netflix entered the game with a home-delivery DVD rental service and quickly overtook the market. Video on-demand services became the next big thing. When people wondered, “What went wrong?”, the common response was that Blockbuster maintained their then-current business model, refusing to innovate in an evolving world. They didn’t adopt a digital transformation strategy, and this ultimately killed the company.

Today there are still many who are failing to act on, or even recognize, the need for digital transformation for their organizations. Like Blockbuster, they believe that their current product, marketing strategy, branding approach, and consumer relationships are in good shape. They don’t pay attention to changing landscapes and competitor growth.

20% Will Fail to Act

According to Forrester Predictions 2018, 20% of CEOs will fail to act on digital transformation and put their firms at risk. Surprisingly, 60% of them believe they’re behind in their companies’ digital needs. This tells us that they’re not unaware, they simply lack sufficient tools, time, budgets, etc. to get the job done.

A CEO gets pulled into so many different directions that keeping focused on a core strategy is a huge challenge. With Cyber Security becoming a significant expense and general IT needs increasing in cost, this growing concern can cause digital transformation to take a backseat to more pressing demands.

Sorting Through the Hype

Artificial Intelligence, Machine Learning, and Blockchain: 3 of the most often-used terms in technology today. Some leaders jump on the bandwagon to be at the forefront of tech, while others aren’t sure what’s really important and what’s just hype. Still, there are some who believe that these elements are all hype and nothing more.

This attitude can be dangerous for a business. Refusing to recognize growing trends can leave a company and its leadership in the dust.

Hey, It’s Only Money

A CFO is always concerned over their organization’s budget. Whether a small company or a large conglomerate, funds are often stretched thin. Money has to cover operating expenses like salaries, travel, and office space, as well as Sales, Marketing, IT, Business Development, R&D, and PR needs.

When launching a digital transformation strategy, sometimes, a complete overhaul of an existing system is required. This can cause a huge hole in a company’s budget. In fact, IDC predicts that global spending on digital transformation will reach $1.3 trillion this year, an almost 17% increase from 2017.

A leader must use his/her instincts, research, team knowledge, and public information to gather as much details as possible in order to make an informed decision. While a CEO certainly recognizes that innovation is critical to the business’ growth and success, putting their money where their mouth is – well, that’s a different story.

Implementing digital transformation can be an enormous undertaking. Can a CEO afford such a huge expense? Can he or she afford not to do it? Not creating an effective digital plan can cost more in the long-run, and that’s something that no CEO can really afford.

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