When Prioritizing Digital Transformation, Start with People

Few ideas ring as true and hollow as digital transformation. It’s at once both a perfect capture of our collective fixation on the digitalization of everything in business, and wholly insufficient to describe anything in particular.

I can think of no other term that makes eyes roll quite as readily.

Why? Because not unlike Valentines Day and Halloween, it’s a commercial invention, a stroke of brilliant marketing designed to create demand out of thin air. 

That doesn’t mean it’s wrong (it’s not), or that I take issue with brilliant marketing (I don’t!)--but it does leave us with more questions than answers.

Questions like: Where do I start? How do I prioritize investments to have the maximum impact on business outcomes? How do I create more organizational resilience, agility, serve customers better, and unlock the potential of my teams?

How do I navigate, say, a global pandemic? 

And in the absence of clear answers, we buy things … and we get lost in protracted implementations that make us feel as though we’re making real progress. 

We get lost in the tweaking at the margins that yield incremental efficiency gains, and we create the window dressing suggestive of modern digital experiences--while we still haven’t answered the most fundamental question: what really matters most?

When you consider that question, consider this: by a wide margin, employees represent the largest single line item in an operating budget. And, by a wide margin, employees represent the most significant lever for creating strategic advantage. We know that employee happiness impacts customer happiness and that engaged and productive employees make magic happen.

That’s why digital transformation should start with people--the employees who create value for your customers and your shareholders. 

And this should start, not with an eye toward taking cost out of the system by automating onboarding processes and other workflows, but by looking closely at the workforce itself--not just in aggregate, but down to the individual level. 

As Jason Averbrook says, it’s the difference between transition and transformation: the former is about replacing systems and the latter is about changing the way we do things. 

This requires real insight into people. It requires a data-driven approach to managing a workforce, allowing HR, people managers and executives to develop a superpower that lets them zoom in, zoom out, and see around corners to make better decisions on behalf of the employee, the customer and the company--all through the lens of understanding people. 

This creates both a strategic and operational capability for driving the performance of teams, and also a lens for prioritizing so-called digital transformation investments. We should use this insight to shine a bright light on hiring, retention, skills, productivity, performance, and happiness to figure out exactly where transformations are necessary. 

The last 12 months have reminded us of the importance of employees as virtually every company on earth has scrambled to get their remote game in order. But while remote work will become a lasting artifact of modern work, the challenges are deeper than Zoom.

Employees care more than about where and when they work--they care about how and why they work. 

They expect deeper meaning from their work. 

Which means that, as managers, we need deeper insight into our employees. And that’s where and when transformation starts.