University of Michigan's Ross School of Business shares the third in a 4-part article series on digital transformation, detailing the four practical steps companies can take to implement digital transformation – to successfully “make the leap” across the digital divide.
Authors: Mary Hinesly, Professor of Executive Education, University of Michigan Ross School of Business; and Jay Srage, Head of Operations - MEA, University of Michigan Ross School of Business.
Welcome to the second in a series of four articles on practical steps companies can take to implement digital transformation – to successfully “make the leap” across the digital divide. These articles will be published over the coming days, so stay tuned for the latest articles in this series.
Welcome to the third in a series of four articles on practical steps companies can take to implement digital transformation and “make the leap” across the digital divide.
In Part 1 and Part 2, we talked about conducting a digital audit to more fully understand the current state of technology and cultural readiness in the firm, and took a deeper dive into educating employees to raise their skill level so they are equipped to lead and implement digital initiatives. In this segment, we will address the process of selecting technology based on a rational framework. In the final segment we will focus of applying and implementing technology through collaborative communication. We previously mentioned that when organizations attend to these four steps, technology adoption happens smoothly – a state of things we call “Technology Cohesion.”
By following the first two steps, the company should now know, at least at the executive levels across different divisions and functions, the technology platforms they have and the gaps they need to fill to fully upgrade their digital technologies. The end goal may be automating the few most important business processes, or something as lofty as building self-learning smart digital platforms that will help the organization overdeliver customer and stakeholder expectations.
Step 3 – Selecting the right technology based on a rational framework
We are now in what Gartner calls the “hype” stage of a set of advanced technologies that include AI, Cloud Computing, Data Science, IOT, 5G and others. How these technologies are applied will redefine companies, create new economic sectors and revolutionize existing ones. Being at the hype stage, there are many variations of solutions in the marketplace, driven by the fact that the “killer applications” (those that are both commercially and technically efficient) have not yet emerged. That will come next during the consolidation phase as the technology matures, becomes more affordable and more efficient, and clear adoption models have been identified.
Several years ago, when working with the second largest accounting firm (in terms of revenue) in the US, we observed that they were very forward thinking, creating what we now call a Rational Framework for technology selection. Our team at the university helped them create a strategy to recruit digitally so all new employees were oriented to required digital tools prior to hiring. The firm invested in digital onboarding, using a rational framework to select the tools the new employees would be using for future tasks and job performance, ensuring new employees would have familiarity before they started their jobs. They created an ecosystem by infiltrating groups of new employees into existing teams to accelerate adoption within those teams while providing channels for reflection, learning and rolling out new initiatives.
What follows is what we call the “DICE” model – a rational framework to select the technology that best fits the organization.
To conclude this segment, digital transformation is not a one-time activity but a long-term evolution of the company. Selecting advanced technologies for deployment in your firm requires a careful and rational framework that goes beyond the typical processes used in the past. The paradox is that within a very rational framework, the smart firms preserve the flexibility and freedom to experiment and fail along the way – they realize that organizational learn more through real world tests and adjustments than by endless paper planning exercises. By filling key skills gaps, and encouraging collaborative action both within the firm and across the industry, you can position your organization to lead these changes rather than playing catch-up.
Watch this space for our fourth and final installment of the series, on the topic of implementing technology through collaborative communication.