Why Culture is Key in Digital Transformation | Accenture Insights

Every day, it seems technology is moving faster. Cloud computing is vastly increasing operational flexibility. Artificial intelligence is creating smarter machines and distilling hidden truths from our data. New realities, augmented and virtual, are combining with our analogue world. Innovation is picking up speed, transforming everything it touches.

But even as it reshapes our world on every level, technology is just a tool. People are the driving force behind the digital transformation. And to transform your organization, to develop an agile mindset, you must tap into their strengths and build a culture that embraces change.

The Awesome Power of Culture

In 2004, Blockbuster was at its peak. With more than 8.000 stores in the U.S. and 84.000 employees, it earned $6 billion in revenue. In the same year, Netflix announced it would begin offering movie downloads to its customers.

In 2016, with only 4.500 employees, Netflix earned $9 billion in revenue. In the intervening period, they managed to defeat their former rival which had once dismissed their business model as a niche effort. Disrupted and outmaneuvered, the Blockbuster brand has been bought out and is now all but shuttered. Currently, its public value rests at $37 million.

Adapt and Thrive

This massive upset has invited many explanations, from the precipitous rise of the internet to the fact that much of the company’s profits hinged on late fees that were universally reviled by its customers. But while there are many reasons for Blockbuster’s reversal of fortune, the foremost among them is the company’s lack of adaptability. Technology can deliver great results, but only in the hands of the right people.

At a crucial moment in its history, Netflix understood this better than most. It set about creating an agile mindset that would allow it to evolve in tandem with the needs of its target audience, and its Culture Deck is famous in Silicon Valley and beyond as a blueprint for wholehearted change. Putting people and culture at the heart of its digital transformation allowed it to innovate quickly and with purpose, disrupting competitors and tapping into fresh market segments.

Why People Should Come First in Digital Transformation

When we talk about digital transformation, terms like agility, flexibility and leanness tend to pop up frequently. They are inextricably linked with the challenges businesses face today, and for good reason. Whether you can think on your feet determines whether you can seize the moment, which ultimately decides whether you’ll be able to delight tomorrow’s customers.

Technology can deliver great results, but only in the hands of the right people.

But these abilities do not magically derive from the right technology or the leanest, meanest internal structure. They derive from the people that power your value proposition, the talent that goes to the ends of the Earth for your customers. Your organizational culture needs to emphasize the results you strive for if you want your digital transformation to stick. And for that, you need to focus on the so-called ‘soft side’. You must put your people first in the transformation process.

The Right Environment Makes All the Difference

Approaching your digital transformation from a human perspective creates an environment where support for change starts at the ground floor. This is essential, because it allows your employees to experience the shift as a positive transition instead of a negative one. With a people-first approach, sourcing the new talent you need to succeed will be easier. Likewise, you won’t have a hard time holding onto the essential talent you already have.

And the benefits don’t end there, either. Emphasizing the human side will relieve tension within your organization and improve team satisfaction. Instead of constantly fighting minor internal battles just to keep your digital transformation on track, you’ll be able to direct your attention outward toward your customers and concentrate on improving their experience with your brand.

Move Faster to Avoid Disruption

Positive workplace attitudes and internal harmony are valuable focal points. But ultimately, the greatest advantage of all is speed. Time is very much of the essence in a digital transformation process. The longer everything drags on, the greater the risk of disruption becomes. Should another company be able to fulfill the changing needs of your customer base faster than you can, they will quite simply outcompete you. Moving quickly requires commitment from your people, and they will be much more likely to embrace change in a culture that lets them tap into their shared passion and be part of something greater than themselves.

Five Essential Steps in Cultivating an Agile Mindset

Reshaping your organizational culture is never easy. Change won’t happen overnight, and shifting the mindset of an entire company requires a significant amount of energy. This is especially true in more traditionally-oriented organizations, where rigid hierarchies have become part of the overall culture.

Of course, the optimal approach to digital transformation will always be unique to your company and industry. Still, there are several core truths you can rely on to guide and accelerate your efforts.

1. Communicate a Clear Sense of Urgency

By nature, humans are not particularly fond of change. After all, why change a winning formula? But winning can quickly fade to middling, which then fades to failing. If you want your people to support the digital transformation process, you should instill a clear sense of urgency. Aim to inspire, but also make sure everybody understands why you must adopt an agile mindset.

2. Learn to Embrace and Use Uncertainty

Many companies gravitate towards certainty. As understandable as this might seem, certainty and inspired change don’t mix very well. Clinging to certainty breeds myopia and circular logic. Instead, dare to embrace the uncertainty that comes with innovation and change. Don’t keep doing what you’ve always done because “that’s just how we do things”. Experiment, test, fail and learn quickly.

3. Bring in Fresh, New Perspectives

Great ideas happen when you bring together passionate people who have different experiences and perspectives. These great ideas are essential to the digital transformation process. Welcome them. Dare to let outsiders in. Invite collaborations with companies and talented professionals whose views are different from your own, and create an atmosphere of openness where new ideas can flourish.

4. Listen to Your Customers

After years of working for the same customers, you might assume you know what’s best for them. In today’s world, that can be a fatal mistake. Consumer needs are evolving every bit as rapidly as the technologies we use to fulfill them. Don’t assume, ask. Invite your customers to come in and share their insights and experiences. Let them be the breath of fresh air your digital transformation needs.

5. Forge Powerful Partnerships

Collaboration is the currency of the future. Ecosystems will dominate tomorrow’s markets, and the companies that forge the right partnerships will be better positioned to stake a claim. Accenture has extensive experience in supporting digital transformations at speed. We will support you every step of the way from inception to realization, enabling you to achieve the desired results quickly.

Digital transformation is not a phase transition – it’s a continuous process, a long-term commitment.

Focus on the Why

“People don’t buy what you do. They buy why you do it.” Simon Sinek’s simple truth is as relevant to the evolution of your business as it is to your value proposition. Digital transformation is not a phase transition – it’s a continuous process, a long-term commitment. Responding to today’s challenges quickly and effectively is only half the battle. As a leader, you will also need to develop an inspiring vision for tomorrow. A future-driven cause is essential, both to motivate your teams and to ensure unified focus from purpose to performance.

Simply put, the objectives that drive your digital transformation – your ‘why’ – must become part of your way of life. That requires passion, commitment and creativity. It requires true believers, a group of people who share a common goal and a unifying sense of urgency. Bringing in fresh talent to embody the desired mindset and inspiring your teams to embrace the process will create lasting change, precisely because it will help you present change as a means to success, not a goal in and of itself.

Build a Culture of Ongoing Change

An agile mindset is not another tool or acquisition. It’s a whole new way of life for your organization. The aim of the game is not to be a changed company, but a company that is capable of change. It’s less about completing the transformation than it is about transforming.

Ask yourself what your greatest challenge is. What is your company struggling with right now? That simple question, seen through the lens of the soft side of digital transformation, will show you where the greatest opportunities lie.

Author : Ingrid Tappin


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