4 Costly Mistakes in Enterprise Digital Transformation
Modernization is expensive. Avoid these big pitfalls so you can stick to your budget and step into the digital age.
In 2020, every company is a tech company. The modern enterprise simply can’t meet customer needs without a strong tech stack. Successful businesses typically run every major operational function through hardware and software, from employee payroll and benefits to customer service calls.
Does that sound like your business, or are you still using low-tech processes to get things done? You might not think you need a digital transformation for your enterprise today, but markets and customer expectations change quickly. The pace of innovation ensures these expectations will only grow over time. Enterprises that fail to adapt to and adopt new technological trends will soon be left behind — if they haven’t been left in the dust already.
Without modern digital systems, customer interactions suffer, brand reviews decline, and operations run into bottlenecks. Inefficient processes can produce subpar customer experiences as readily as poor support, and in many cases, poor processes are the reason people contact support in the first place.
Digital transformations can upgrade your operations to keep you and your team working efficiently and effectively. Such changes now happen all the time in large organizations, but they’re not always successful.
How can you avoid costly digital transformation mistakes and keep your company on the right path? You can start with this guide which we’ve put together to help you identify (and avoid) some of the most common digital transformation mistakes.
1. Unclear vision lacking customer appeal
Customers want brands to understand them. This requires decision-making and problem-solving processes focused on customer wants and needs.
To delight customers, you need to address two types of problems: blame and acceptance.
Blame problems stem from any negative experiences a customer might blame you for, even if it might not be your fault. Defective products and slow restocking times are two examples in which a company is clearly at fault. A power outage that shuts down your operations might not be your fault, but customers will blame you if their experiences worsen and they can’t understand why.
If you don’t fix these issues, customer resentment quickly builds towards your organization. No one wants to do business with a company that doesn’t care about their experiences.
Acceptance problems are things your customers accept as an inevitable downside to doing business with you. A long wait for technical support and slow checkout lines are common, so most people expect them — but that doesn’t mean it’s appreciated.
If you can solve an accepted problem, customers take notice. The impact is often greater than the impact of solving a blame problem since blame happens on an individual level, but acceptance takes place across your entire customer base.
2. Skewed priorities
Brainstorming sessions can provide a bigger pool of considerations when you’re ready to upgrade. The bigger the pool, the higher the odds will be of landing the best outcome. However, priorities can become misaligned if you wind up with too many ideas.
You need a process or system to organize your ideas. If not, you might waste resources on ideas that aren’t worth your time. This is generally true for any major project, not just digital transformations.
The best way to prioritize is to implement a standard process. You can change the particulars to fit your enterprise, but this four-step process might be a good starting point:
Gather ideas
Consolidate similar ideas and assess the value of each. Certain things will be more valuable to you than others based on your industry, business model, and so on. So, focus on those high-value propositions first. Once you’ve done this for all ideas under consideration, you can start comparing ideas based on their relative value to your business.
Estimate costs
“Costs” include monetary, personnel, and physical (material goods) costs. Determine how much money and effort your ideas will take so you can make informed decisions as to whether or not it’s worth your time.
Assess risks
Every action involves risk, but you need to decide which idea provides the most value for the least risk.
Make decisions
To keep things as streamlined and clear as possible, reduce your ideas to their most basic forms. When you’ve simplified things, it’ll be easier to choose wisely, because you’ll be focused on what really matters and will really move the needle for your enterprise.
3. Technology that doesn’t scale with your needs
Your customers ultimately decide how much money you’ll make and how much your business can grow. Customers have more uniquely defined needs than ever in the digital age, and they’re constantly bombarded by an unending stream of advertising, entertainment, trends, and information. A modern enterprise’s products and services need to be available through many different access points.
If you’re not available, you might get lost in the shuffle. Good customer experiences are important, but they won’t mean anything if the system supporting those experiences doesn’t work as expected. A good system should do what it’s designed to do right now, but it also needs to be able to accommodate your business needs over the long-term.
The best systems work well with multiple moving parts, either internally or in tandem with other applications. For example, a checkout system should handle transactions, returns, and exchanges. But, it also needs to interface with inventory management systems and accounting systems, so all parts of your business can operate with the same information in real-time.
Scalability might not seem like a big issue right now, but nothing stops enterprise growth like a system that breaks down as you get bigger.
It’s always better to upgrade before you run into issues. However, if you run into an emergency upgrade situation, don’t rush into the first solution you find — make sure any new tech that can handle you today will be there for you next year or even 10 years from now.
4. Internal issues
People tend to dislike change. Even if they say they’re on board, many people will resist subconsciously, undermining your efforts to change. Your team might find it difficult to adapt to new processes, no matter how much time and effort you put into your digital transformation. It’s a common problem, but it doesn’t have to stop your growth.
Let your team participate in the process and listen to their insights. Their point of view can be valuable, especially if they’re dealing with obstacles you don’t see every day.
Digital transformations can be challenging, but they’re much harder if your team isn’t on board. Getting everyone focused on a common goal is the first step toward productive problem-solving.
RTS Labs is here to help with your digital transformation needs. Whether you want to avoid these issues or make the process easier, we can help you move your enterprise into the digital age. If you need help creating or executing your digital transformation strategy, get in touch with our team today.