Striking the right balance between IT magic and digital transformation

More companies are going all-in on the latest technology, opting for digital transformation, embracing modern solutions, and competing with nimble, digitally native startups. Since COVID-19 moved so many businesses online,?72 percent of corporations ?sped up their digital transformation efforts.

But for some, the results have failed to meet expectations. About?70 percent? of digital transformation efforts fail to achieve their goals, and nearly?$900 billion ?of the $1.3 trillion spent on these initiatives goes to waste. Why??

Some organizations don’t implement new technology with a plan to strengthen their business strategically — they implement it because they want to hop on a hot new IT trend and expect the technology alone to carry the weight. They’re betting on the opportunity for change without a strategic plan to turn that opportunity into concrete reality. Instead, companies should ask themselves, “What is the fundamental goal of digital transformation?

With an answer to that question as your foundation, you’re set up to see real change.

How to turn a digital transformation into a?strategic transformation

The key to a successful digital transformation is to ensure that it’s built on a solid strategic foundation — not just the latest IT trend. CIOs and CTOs have to be ready to lead with a steady hand, solid plan, and readiness to create change. Use these three strategies to ensure your digital transformation is strong from the start:

1. Create a cohesive, ambitious internal vision

A successful digital transformation should involve more than upgrading existing systems, but that doesn’t mean you should throw away everything that makes your company work to chase the latest tech trend. Craft a vision that works to your strengths while still pushing your company to the forefront of your industry.

If that sounds complicated, consider the examples of GE’s?digital transformation failure?and PwC’s success. In the early 2010s, GE saw companies like Google and Amazon have great success in data mining and decided it wanted a piece of the action. As a result, it moved away from its core strengths and became a data and analytics company.

While the impulse to meet the future was on the right track, GE tried to follow external trends rather than looking inward. The company didn’t try to see how it could leverage the people and resources it already had to create something forward-thinking. As a result, the initiative failed.

PwC, in contrast, looked inside. It created a vision that brought its employees along with it, building on its existing strengths to create a digital-first company that had the skills to back up its tech.

For a digital transformation to work, your ambitious vision has to extend to and include your whole team. Taking the time to ensure you use the power of your people and?communicating your vision?with everyone are both essential steps to optimizing your transformation.

2. Let your MVP guide you

While it’s true that a digital transformation should eventually be an undertaking that impacts your company’s future, it doesn’t have to start with giant leaps. One of the best ways to ensure that your?strategic transformation?will?align with business goals?is to start small with a minimum viable product, or MVP.

An MVP is a bare-bones product designed to see whether customers actually want what you’re trying to sell. It’s a smaller commitment, both in time and money, which means fewer risks. It lets you test your offering first if you’re hesitant about transformation.

An MVP builds confidence from users, making for a smoother adoption process internally and externally. It can also be a great way to get feedback during development. This can tell you which features to prioritize and even provide new ideas on how customers will actually use your product.

3. Turn your transformation tools into sales opportunities

Digital tools are constantly evolving. You might change to a new?cloud-based platform ?only to see newer and better platforms release. It can be overwhelming and exhausting to keep up with this change, but it can also be a great way to create a new sales vertical.

I’ve seen firsthand how digital transformation can lead to the creation of purpose-built cloud applications for specific use cases. Many times, these internal tools have the potential to become products themselves. If it’s successful for your own business, chances are you can sell it to your competitors for the same purpose. This might sound like a way to curb your competitive advantage, but it could be exactly what you need.

The competitors you have today probably won’t be the same competitors you’ll have tomorrow. According to a?Deloitte survey , less than one-third of respondents believe their current competitors will still be their competition five years from now. Instead, they view startups and digitally native companies as the real threat. By creating a tool other leaders need for their own digital transformations, you?can be one of those digitally native companies — not just another competitor who gets left behind.

A digital transformation depends on alignment, boldness, and strategy. Rather than chasing tech for the sake of tech without expecting to do any heavy lifting, ask yourself, “What business will replace ours in the near future?” Then, use the answer to drive your decisions.

Transformation isn’t just about changing a server here or an app there — it’s about rethinking your entire business model with a digital-first?and?company-first mindset.

Share your thoughts below in the comments, I'd love to hear some other perspectives!

Shawn Freeman?- VP at?Fully Managed ?-?Shawn has a passion for technology and more than a decade of experience in computer science and management.