Navigating the new era of business transformation
For a long time, digital transformation (DX) was the default answer to addressing changing market dynamics, disruptions and customer demands. But while there have been efficiency and productivity gains through some of these efforts, there have also been countless mistakes along the way. Many companies are struggling to reap the benefits, with data from an IDC InfoBrief sponsored by Endava showing that half of DX projects undertaken in the past year have failed to achieve expected results and goals. Add to this the significant financial impact of failure, as 59% of organizations believe investments in DX projects are wasted.
These disappointing results are staggering when the majority of these organizations consider themselves digital-first.
When we dig deeper into the domino effect of failed initiatives, the very real human impact also becomes clear. It’s not just the time-to-market and digital maturity of companies that suffer; Failures have also resulted in frustrated staff (56%), employees leaving the company (50%) and a work environment that is less exciting and stimulating for teams (44%). All this increases pressure on companies already struggling in a difficult economy and points to an urgent need to shift focus. To put it bluntly, companies need to stop wasting time and effort and start putting people at the center of their strategies.
Invest in people for the best results
Too often, approaches to DX have failed to focus on what matters: the employees using these technologies. After all, they are the ones who ultimately add value and must ensure that digital initiatives achieve the desired business results. But building digital solutions in silos without truly considering how people interact with them limits their potential and disengages employees.
Recent data confirms this idea that business leaders have vastly underestimated the importance of employee engagement, as IDC’s findings cited it as one of the top reasons for the failure of DX initiatives. Similarly, lack of collaboration between different departments in an organization and conflicting opinions from management were also cited as key reasons, showing that digitalization efforts are not only counterproductive as tools fail to strike a chord with people, but also fail to to accommodate internal team dynamics. Without a strong sense of collaboration and communication, the problems with digital projects are magnified and stakeholders become disconnected.
While it’s clear that an employee-centric approach is the missing ingredient for success, it shouldn’t just be an afterthought. Companies must actively involve employees in every phase of digitalization – from planning to design, implementation and continuous improvements. This requires truly understanding the needs of all employees across the business, and equipping them with the training and skills requirements to manage tools effectively and feel empowered as a result.
The same IDC InfoBrief also found that companies recognized gaps in the training and collaboration of their workforce, indicating that wasted investments in DX could have been better spent elsewhere, including on upskilling staff and improving internal communications . Yet digital transformation and upskilling do not have to be mutually exclusive; rather, training should be an integral part of the ongoing management and improvement of DX initiatives.
Adopting this people-centric mindset from the start will not only prevent wasted investments by enabling people to take advantage of technologies, but it will also build innovation and creativity into the culture of the organization. That’s because creating a constant practice of knowledge sharing allows employees to participate in making technologies successful, while at the same time discovering ways to improve solutions as the environment and market around them inevitably evolve. It’s the diverse skills and perspectives of employees that bring technologies to life.
Your technology is only as good as your people
With growing concerns about the advancement of AI and its associated potential risks, as well as the power dynamics shifting from employer to employee, the need for a human-centered approach to deploying technology will only increase. An example of this is that employees will be integral in ensuring that tools like generative AI are used responsibly to avoid perpetuating inaccuracies and biases within models. As such, nurturing engagement with digital solutions also means creating a workplace where people can actively identify problems and think strategically about how to best use such solutions, rather than passively accepting their outcomes.
By harnessing human qualities such as creativity and critical thinking in combination with digital solutions, companies will be able to lay the foundation for true resilience. It’s an approach that ultimately supports more fulfilling and interesting work for employees, and in turn supports talent retention and acquisition efforts. You can have the most cutting-edge new technologies and innovations, but if you don’t invest in your people and prioritize employee engagement, you’re burning money.
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