What's the Secret to Successful Digital Transformation? Effective Change Management

Digital transformation should be a priority for any business in today's environment. Integrating the latest technology throughout every aspect of your operations is essential in better serving customers, improving productivity and ensuring you're able to keep pace with competitors. Indeed, figures from Gartner suggest 91% of organizations are engaged in some form of digital initiative, so you can't afford to be left behind.

Done well, this can have a major positive impact. Research by PTC suggests the main benefits of digital transformation efforts include improved operational efficiency (40%), faster time to market (36%) and a greater ability to meet customer expectations (35%). Yet according to research by McKinsey, as many as 70% of change management efforts fail.

So how can you avoid any problems and ensure your digital transformation projects are a success? One essential element will be to place a good change management strategy at the heart of your efforts.

What does change management involve?

Change management can be a complex and wide-ranging subject. Therefore, it's important to understand exactly what this is and what it will involve before you set out on any project.

According to change management specialist Prosci, the term is defined as "the application of a structured process and set of tools for leading the people side of change to achieve a desired outcome".

In other words, whereas project management focuses on the technical side of a digital transformation, including the skills, tools and processes you'll use to implement new solutions, change management focuses on ensuring users of the solutions are able to effectively engage with the project and adopt the tools in their everyday work.

The importance of strong communication

A key aspect of any change management strategy is good communication with everyone who will be using the tools. Employee resistance is one of the leading causes of project failure, and this often comes back to either not understanding the reasons behind the change or a high level of skepticism that the new technologies will offer an improvement.

To overcome these doubts, it's vital that you can explain the purposes and expected benefits of the new solutions as clearly and simply as possible and be prepared to answer any questions your users will have about the technology.

It's important to keep in mind the familiar mantra of 'what's in it for me?'. If you're able to effectively frame the new technologies in terms of how they'll directly benefit employees they’ll be far more likely to accept them. For example, if a new system will reduce tedious manual data entry tasks, highlight how this will free up users' time for more interesting activities.

Securing executive buy-in

Getting people on board with digital transformation starts at the top. That's why change management needs to have a clear strategy for how innovations are pitched to board-level executives.

Ensuring these individuals are bought into a project means much more than just securing financial support for an initiative. Having the most senior people within the company advocating for a change filters down to the entire business, thereby increasing everyone's confidence in the initiative.

The chances are you'll need to tailor your arguments to each individual C-Suite member. For instance, the chief financial officer is more likely to be concerned with the potential cost implications of the project, so you'll have to have figures on hand to demonstrate an expected return on investment in order to justify the expense of the project.

Others may be more concerned about the effect it will have on customer experience or the efficiency gains they can expect to see on critical processes. Meanwhile, issues such as security and privacy are increasingly important, so it pays to know what the priorities of each board member are.

5 steps to effective change management

So how should you go about formulating a change management plan that will get everyone on board? No plan can be effective without the right foundations, so understanding exactly what you need to do and when, right from the start of your project, is a must. With this in mind, here are five key stages of an effective change management strategy and what they involve.

1. Prepare: Begin your project by setting out what your overall aims are, who the key stakeholders are and how you'll keep track of your progress. At this stage, a key focus should be ensuring visibility throughout the project and what risks you expect to encounter.
2. Define: This is where you'll go into more detail with setting out specific business goals and how you'll achieve them. From a change management perspective, this means identifying key tactics that will encourage your users to take-up the new tools and when to introduce them.
3. Design: Alongside the design for your digital solution, this stage will include gathering the input of various departments into a clear plan, setting out details of how the solution will be rolled out and how users will be trained on it, as well as drawing up a timeframe for the project.
4. Build: The actual development phase for your new digital tools needs to incorporate change management throughout. Ensure the impact of any decision on usability and practicality is assessed before you commit to a building phase. This requires close collaboration between developers and change management specialists to collate feedback and work together on solutions.
5. Launch: The final stage of the project is getting into production. This is where you'll run training sessions and take assessments of its real-world impact. Ensure you encourage feedback on any teething troubles and address any issues. This is essential in making certain that users see the benefits of the solution and stick with it.