What is Digital Transformation and Why is it Important?

Today’s post comes to us from Workforce Institute board member and HR Bartender, Sharlyn Lauby. She reminds us that successful digital transformation ultimately relies on human behavior.

There’s lots of talk about digital transformation but do we really know what it means? And everything that’s involved? One of the best definitions I’ve heard was at KronosWorks 2019. John Frehse, senior managing director at Ankura Consulting Group LLC, described digital transformation with the line, “Data is out. Answers are in.” His point was that digital transformation is about organizations getting answers through the strategic use of technology.

Decades ago, the way businesses used to get answers was by sifting through piles of data. But let’s face it, employees really don’t like crunching the numbers. And just about the time they finish pulling all the numbers together, the data isn’t current anymore. Organizations are faced with a situation where they’re always being reactionary because they simply can’t keep up with the data.

Digital transformation is focused on creating a new way of business. It’s about giving employees the answer and empowering them to make good decisions. Technology is able to crunch the numbers, do it quickly, and free up organizations, giving them the time they need to make business decisions.

While technology is a key ingredient in digital transformation, it’s important to note that digital transformation isn’t about technology. Let me say that again – it’s not technology! It’s about organizational change.

I hate to say it but in the old days, if an organization didn’t want to make the tough decision, they could always blame the slow process of crunching the numbers. Or the potentially inaccurate data.

Digital transformation doesn’t give organizations anywhere to hide. And now that organizations have the answers, they need to ask themselves “Are we willing to make the tough decisions?” Then, because change is hard, is the organization willing to commit to implementing the change?

It’s a bit ironic that digital transformation is all about employees. Frehse reminded us during his session that employees are smart and very aware of company culture. They will be watching to see if the organization is using digital transformation to make the workplace better. Because once organizations have the answers, they need to take action. Or employees will start looking for employers that use digital transformation to improve the employee experience (as well as their bottom-line).  

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