Although digital investment is almost unquestionably the right course of action for most firms, organizations still struggle to create the desired results. Estimates of digital transformation failures range from 66% to 84%. Such a high failure rate isn’t surprising, as leaders are trying to create entirely new competencies and wedge them into an organization with strong legacy cultures and operating models.
While most executives are pros at managing change, digital transformation is a much deeper change than the usual process or system update. Of course, digital technology can be used to improve or augment existing ways of operating, but it also opens entirely new ways of doing business based on digital networks like Uber, Airbnb, Yelp, and the Apple Developer Network — which is where a great deal of the digital value resides.
So as you navigate your own digital transformation, we recommend beginning with a few questions that go deeper than “what talent do you need” or “how much money will you spend” and probe broader organizational readiness.