Top digital transformation mistakes

You might be primed and ready for digital transformation. Or you might already be well on your journey.

Or, if you’re like a lot of organizations, you’ve tried and have either failed or not been happy with the results.

You’re not alone. Wipfli’s research shows that every organization is setting digital priorities tied to everything from customer engagement to data integration.

The path to successful digital transformation means avoiding some common pitfalls. Here are the five biggest mistakes executives have cited and how to avoid them.

Mistake #1: You haven't determined how you'll measure success

Successful digital transformations are twice as likely to have been executed with clear KPIs and targets than unsuccessful ones.

Here’s why enterprises need to install key performance indicators ― and how to work them in:

Read the fuel gauge

They are missing out on opportunities. Case in point: Measurable wins, however small, buoy team spirit. And digital transformation is a rocky road, so markers of success help smooth out the bumps.

Second, without real results, the case to the C-suite gets fuzzy. You need continued investment from top down. Nothing makes the point better than visible success — or failure.

Remember that it’s about data

Data is the currency that fuels digital transformation. Companies that ignore KPIs miss the point of the exercise.

It’s never too late to go back to the drawing board. Work backward from final outcomes. Ask yourself: What is our goal? Why are we doing this? How can we measure the before and after? The KPIs will fall into place after this exercise.

Get smart about SMART

In some cases, enterprises might have set KPIs in place, but they are too fuzzy to be any good. You need specific, measurable, achievable, relevant and time-bound (SMART) goals. Agile transformations set goals in bite-sized chunks with measurable outcomes.

Don’t forget to recalibrate

You’ve seen it: The digitally mature business you have built today might have been barely recognizable three years ago. KPIs set in motion years ago rarely are still relevant. When transformation goal posts change — as they should — make sure you are not using old standards to measure new outcomes. Study the KPIs under the microscope to see whether they still work for where your enterprise is today.

Mistake #2: You don't have a change management plan

A staggering 70% of all digital transformations fail because enterprises miss real opportunities for dialog with their people. Change management helps people take ownership of the process. Without that, the battle is already lost.

Here’s how to nurture effective change management:

Run what-if scenarios

Technology is a crucial pillar of digital transformation. But talk of technology makes employees apprehensive. Too often, enterprises fail to validate the very real worries their workers might face. One group seminar is not enough. Drill down and talk to each employee and show where and how they will fit in the new landscape.

Technology augments intelligence. It does not replace it. Until each team member sees that, the work of digital transformation will be half-baked at best.

Train new talent

It’s not enough to assume the team you started out with on digital transformation will spearhead the process forever. Talent pools are constantly in flux. New recruits need training and context. Even invested ambassadors might get rusty after a while. Keeping people invested and incentivized is an ongoing commitment.

Nurture talent

Too often, companies fit the team member to the job rather than mold the job to the talent at hand.

Take an inventory of your talent. Are you really using the right talent for the right job? Playing to employees’ strengths leads to a more productive and satisfied workforce, one that will accelerate digital transformation.

Recognize change agents

Change management is not just about people. It’s also about looking at what is coming down the pike. Digitally mature organizations run what-if scenarios for disruptions like tariffs or black swan events. They have a playbook to scan the horizon for change and know how to react to it. Resilience is the point of the digital transformation game. Agility and preparedness are how enterprises can get there.

Mistake #3: You've misunderstood the true role of tech

A shiny new tech stack might be an attractive proposition, but investment in one is not the end goal of digital transformation. Too often, enterprises fail to realize that technology is merely a facilitator. Such points of view lead to processes that are tech-driven and not outcome-focused.

Here’s how to avoid making this mistake:

Align solution to technology, not the other way around

It’s easy to get carried away by the next shiny technology around the corner. But it might not be a good fit for your organization. Again, goals matter. Digital transformation is not an “embrace all technology” approach. It’s about embracing the right technologies at the right time and building on early gains.

Don’t let silos adopt technology based only on their specific goals

Marketing and sales might like one software product. Team service members might like another. Together, will the data from each be readily accessible? Easy to work on?

Digital transformation is about end-to-end data transparency. That cannot happen with silos. It cannot happen if each team is speaking its own tech language.

Use modular technology platforms

Given that digital transformation is an ongoing process, you need a tech stack that can accommodate the next promising technology. Too often, enterprises think only about the near future when fulfilling tech needs. Ask whether the solutions recommended will play well with tomorrow’s platforms.

Use data for clarity

Sometimes, enterprises collect all the data all the time without understanding the whys. The data lake is not a good place to be mired in. Ensuring a centralized and secure data platform enables you to process and act on the right data. Asking the whys of the digital transformation initiative will be key in deciding which data to measure and value.

Mistake #4: You haven't explored the ecosystem

Disruptions in one enterprise can have a ripple effect on others, so disruption can come at you from anywhere.

Here’s how to guard against the unexpected:

Partner with the right digital partners

Sometimes an external expert can evaluate the landscape better than the talent who are too close to the action. You might be missing valuable insights about your digital transformation growth by not leaning on the right digital partners at the right time. Partnering with an external firm can help large enterprises stay agile and feed on the best technology advances.

Identify points of friction in the ecosystem

Orchestrated processes do not begin and end at your company doors. Points of friction up and down the supply chain might affect your business. They might harm brand image. Don’t miss the chance to truly dig into the ecosystem to find and root out all points of friction in your business — even ones external to your enterprise.

Focus on your strengths

How deep is your cybersecurity bench? Where are your key strengths? In today’s complex business climate, needs evolve all the time. And skilled talent is not easy to find. Focusing on key competencies, while outsourcing the rest, is one way to keep digital transformation firmly on track. Too often companies make the mistake of reinventing the wheel from scratch. That’s not always called for.

Share data across the ecosystem

Picture a manufacturing plant that depends on an external vendor for inventory. Instead of having to complete purchase orders for restocking, you could share data about stock and future production quotas to give the vendor key insights into what might be needed tomorrow. Push data-driven decisions up and down valuable partners. Enterprises are beginning to realize the value of pooled data and the efficiencies it can generate.

Mistake #5: You're not leaving room for innovation

The agile mindset is meant to deliver radical new approaches to old problems. But sometimes the deep work needed for innovation gets left behind in the sprints.

Making room for innovation is the sure way to stay ahead of the competition.

Adopt a customer-centric outlook

Are you keeping your end customer in mind? As companies move along the path to digital maturity, they might forget that their customers are, too. Keep a pulse on the evolving needs of the customer so your services continue to stay relevant.

Incorporate new technologies

Yes, we advise against a blind adoption of every technology that comes down the pike. But we do encourage keeping an eye on it all. If you find a fit with your ongoing transformation goals, make room to be an early adopter. Enterprises also need to understand how to work the technology in their custom setting to realize its full potential.

Refine, re-evaluate, refine

Digital transformation is not a one-and-done formula. It needs constant care and feeding to stay on track and to harvest the fruits of continued ingenuity. Assuming the work of digital transformation is over once you have achieved a select few KPIs is a mistake many make.