Yaneek Page | Digital transformation failure? There’s a fix for that

QUESTION: About mid-April 2020, we launched our company’s digital-transformation plan in response to the pandemic crisis, which forced us to implement work from home and utilise more technology to get the work done. We had to buy more laptops and mobile phones. We also provided an allowance for work from home to offset the cost of electricity. The company pays the CUG-plan for the new mobile phone. The only difference that we saw in terms of reduced expenses was a very small decline in our electricity bill, which has since gone back up.

Productivity has actually reduced not increased, and to make matters worse, the revenues and profits have also declined. For all the touted benefits of digital transformation, my company has yet to see any of this, and we’re at the point where we were may have to look at job cuts if we’re going to survive 2021. I have already used up not only the little reserves we had for the company, but also dipped way into my personal savings. We can’t continue like this and I need your advice on where you think we went wrong and if we can correct it. Please help! My business and jobs are depending on it.

– Company ABC

BUSINESSWISE: I’m very sorry to learn of the challenges that you’re facing in your business and the dire implications for your team and your financial well-being. On the bright side, a ray of hope for global economic and social recovery is the mass vaccinations now taking place, however, as I have stressed in previous articles, it will remain a challenging time for many companies even after COVID-19 is no longer a global threat.

While you provided details on your industry, services, target customer, and other details, at your request I have omitted this information to protect the identity of your company.

One of the main reasons your “digital transformation” failed is because you narrowly defined digital transformation as a shift from the brick-and-mortar office set-up to a virtual-team approach. That’s not digital transformation.

Digital transformation in any for-profit company should begin with the business model, not technology. By that I mean that yo and the leadership of the organisation – your board of directors, advisory board, senior managers – should have had a strategic retreat where you brainstormed the overhaul of your entire business, beginning with the new value propositions you will deliver to each customer segment to generate the new or expanded revenue streams. Value, which can be differentiated from the competition, and for which customers are willing to pay.

You should have started with a primary focus on better understanding the customer and then proffering new digital solutions to solve new or existing problems and/or fill new or existing needs. Thereafter, you should have completed the financial analysis and feasibility assessment to validate the new digital model.

However, this is not where you started. You are executing the same old business model, offering no new or enhanced solutions to your customers, delivering no added value for which your customers would be willing to pay – especially in a pandemic when every single customer has gone through a considerable number of shocks.

Your customers are not the same people they were in January 2020 before the world was disrupted. They have new needs, some have new financial realities, their problems are likely different or exacerbated. Yet, you’ve not focused on them at all.

You focused on a quick fix to enable your employees to work from home. Your employees are struggling through change, too. However, based on what you outlined, the company hasn’t provided adequate leadership, especially not the vision, creativity, problem-solving, and especially inspiration needed to transform the business at this time.

To make matters worse, neither you nor your team had any training, or virtual strategic planning sessions, or the requisite external support to advance and operationalise a credible digital-transformation strategy. There was not even a change in basic performance management or measurement. It is the epitome of giving your team a straw basket to carry water. It could not have worked.

I know this doesn’t sound like good news, but it actually is because now you know where you went wrong, what you need to fix and how. It would have been dismal if you had actually executed a well-designed digital-transformation strategy, did everything you were supposed to do and failed.

There is still considerable opportunity in your industry. You still have a customer base that knows and trusts you, and your company has a recognisable brand in the marketplace. You have more than a ray of hope to formulate and execute a real digital transformation strategy to save your business.

Good luck and one love!

- Yaneek Page is the programme lead for Market Entry USA, a certified trainer in entrepreneurship, and creator and executive producer of The Innovators and Let’s Make Peace TV series. yaneek.page@gmail.com