Unpacking the Digital Transformation Journey

In an epoch characterized by rapid evolution of digital, cultural, public health, and economic dimensions, the imperative to modernize legacy enterprises intensifies. However, myriad organizations remain hesitant to heed the clarion call of Digital Transformation, a delay that erodes the luxury of time.

Businesses that do not succeed in Digital Transformation in the next three years may not survive the coming ten

Amidst escalating waves of innovation and shifting consumer behaviors, the imperative for transformation rings clear for many organizations whose transformational journey has been ensnared by the twin challenges of COVID-19 and economic vagaries. While these are absolutely valid grounds to defer substantial multi-year investments, as we near the fourth anniversary of the pandemic’s onset, the reluctance to adapt to the intertwined evolution of technology and societal expectations has morphed from a competitive shortfall to a looming existential jeopardy.

My journey through Digital Transformation began in 2007, alongside the unveiling of the first iPhone, though the phrase “Digital Transformation” didn’t gain currency until 2011. Over the subsequent 16 years, I’ve been at the vanguard, witnessing the revitalizing potential it offers to enterprises amidst the tumultuous seas of modern market dynamics. I’ve observed the changing character of companies striving to bridge the divide between their existing operational footprints and the expansive expectations and opportunities in the world at large.

Initially, the narrative was spearheaded by financially buoyant innovators and early adopters, soon followed by fast followers and those enticed by self-reinvention, but today, the narrative has evolved, presenting a ubiquitous challenge to every enterprise yet to tread this path: how do we transmute our organizational culture to one that welcomes the incessant flux in technology and consumer tendencies, ensuring we are not eclipsed by the accelerating pace of change?

Some of those early pioneers now find themselves back at the outset, primarily due to their initial misinterpretation of Digital Transformation as merely a project. Their initial approach, fixated on introducing new technology, establishing innovation hubs, championing a “customer-first” ethos, and centralizing data, was devoid of a broader cultural metamorphosis. Their journey now serves as a forewarning, accentuating a bedrock principle:

Digital Transformation demands a total cultural shift, eschewing the status quo, and advocating perpetual adaptation to the relentless socio-environmental and technological shifts ahead

In this article, I’ll unpack some of the history and necessity behind Digital Transformation, the key levers for implementation, and set out a posture for future readiness.

What is Digital Transformation?

In July 2011, when Cap Gemini published the 1st edition of Digital Transformation Review, the need for change was already becoming apparent in industries that were very consumer-facing. Even in those early days, as noted in the editorial intro to that report, it was clear that the fundamental transformation was not only digital:

…digital has a fundamental impact on how change takes place. Moving forward, every strategy that is devised must take account of the opportunities offered by these new technologies and their related applications. While transformation is not just digital, transformation cannot do without digital.

With the four-year-old iPhone as a new platform for interaction, and the 2008 announcement of HTML5, new digital possibilities were rapidly opening and some companies were already looking to meet their customers where they were going.

A new Dialogue

From 2008 to 2010 I was lucky enough to lead the team responsible for Shell’s digital properties, and with public attention on the company at the time being very focused on its role as an energy firm, there was a desire to engage with customers, activists and the public at large in new ways.

While shell.com was the most effective corporate website in the world in 2011 thanks to our work, the groundbreaking innovation came with Shell Dialogues, one of the first examples of a platform built for what we might now term AMA — realtime, live conversations between representatives of Royal Dutch Shell and members of the global community.

Since then, the changes have been thick and fast, and have come from unexpected sources. Telehealth and virtual classrooms both got a huge kick from COVID lockdowns; two of the slowest-moving industries shocked into near-instantaneous adoption of innovative tech. That shock brought a salutary lesson too: adopting the tech is not what makes transformation successful — you have to change the attitudes, expectations and incentives of the entire ecosystem to support new ways of working with that tech.

That lesson is one that should be well-noted throughout other industries, beyond healthcare and education. The goal of Digital Transformation can never be to deploy cutting-edge technology, wash one’s hands, and walk away — this way lies only pain.

So, while there are numerous technology-focused facets of Digital Transformation, and we’ll dive deeply into many of them in subsequent articles in this series, for this initial discussion we’ll eschew talk of cloud-native, data-first, change-independent, product-oriented, customer-first, innovation-forward, hyper-scalable security-minded agile companies with disruptive uses for generative AI, an inclusive approach to technology and society and a focus on long-term governance and sustainability.

Instead, we’ll look at why the culture change is so critical, how other changes are made moot without it, and how it can lead to emergent transformation when coupled with strong and compassionate leadership.

A Total Cultural Shift

If we accept the reality that change is inevitable, in customer behavior, change in social context and change in technological capability, and is matched with the potential for runaway change in the natural environment, then it’s clear that the methods of the past will not suffice.

We cannot be held captive by years-long adoption cycles, cannot wait until 15 years post-iPhone to make our websites work on smartphones, cannot ignore changing expectations of convenience and availability. We must not blindly accept the negative impacts that organizations can have on the societies they are placed in, nor the land they sit on.

In order for Digital Transformation to be considered successful, we must emerge on the other side blinking in the bright light of a new day — a day where our colleagues and partners are constantly on the lookout for ways to own our socio-ecological footprint, to adapt to emerging behaviors and to adopt new technological opportunities.

In that light, the core of Digital Transformation as a fundamental cultural shift is clear — for most organizations there are but a few colleagues and partners who act in this way, and they mostly have this future-facing perspective as an explicit part of their job description. As we reach the end of the present decade, that will not be enough; the change will be happening too fast, in too many ways and in too many places for any subset of our companies to monitor, let alone respond to.

The only way to make this work is to change our enterprises’ cultures, and that shift must happen at a deep level in order to be persistent and meaningful.

We must create practices of openness to change, of continuous learning and of cross-functional collaboration. Our existing business habits are often geared toward protecting the status quo and providing organizational stability, and we need to work to break these down; aligning incentives and conventions to an always-on adoption of newly-emergent possibility.

To make these revitalized cultures useful we must, of course, make the matching technical and operational changes, but we find again and again that these are far easier to achieve with a workforce that is anxious to reap their benefits, rather than one that is having technological change imposed upon it.

Emergent innovation that happens at the individual product or service level, within teams with significant autonomy, is critical to building these cultures. We must, though make sure that we are not allowing disparate parts of our business to run amock, proliferating the tools we pay for, introducing inconsistencies and incompatibilities, and bloating our operational footprint.

Strong, self-aware leadership is the only way to achieve this; understanding that we need to cede responsibility for adapting to changing environments, while ensuring that we have well-codified standards and strategies in place to facilitate that delegated decision-making.