7 Digital Transformation Mistakes to Avoid

The stakes for digital transformation are extremely high. You either keep up with the times or prepare to lose your market share to more tech-ready competitors.

Yet, the digital transformation process isn’t that easy. There are many challenges businesses should be ready to face along the way.

To help you safely navigate the pitfalls and reap all of the benefits, in this article we will tell you about the key digital transformation risks and provide some useful tips on how to avoid them.

Read on to learn more.

Top challenges of digital transformation

There are many examples of companies that have undergone a digital transformation successfully: from Walmart and Hilton to JPMorgan Chase and Bank of America.

Yet, not all businesses that set out to digitize their operations came out a winner. Along with the successful cases, there are also dozens of companies that failed when it came to digital transformation, e.g. Sears, General Electric, Ford, or even Nike, to name a few.

While all of them failed due to different reasons (or their combinations), there are certain problems most businesses face on their journey to digital transformation. Namely, here are some of the digital transformation challenges:

  1. Fighting the legacy is considered a number one challenge for most established businesses when starting their digital journey. This typically leads to integration challenges and can significantly slow down the transformation.
  2. Lack of proper oversight often leads to significant difficulties and can cripple your transformation. That is why it’s so important to establish clear leadership within your digital initiative.
  3. Compliance with the regulations is both the reasons many businesses decide to modernize and go digital as well as one of the challenges they need to face along the way. Namely, businesses should consider compliance regulations when building the infrastructure for data collection, storage, and processing.
  4. Corporate culture can also be a roadblock for your transformation. If your staff refuses to adapt to the new business paradigm, you can never make your digital initiative work, no matter how good your strategy is.
  5. Lack of organizational support can turn out to be a problem when justifying the expenses of the digital transformation to the top executives or asking for more resources to put into it.


5 digital transformation mistakes and how to avoid them

On top of the challenges listed above, which most of us can’t foresee or avoid, there are many more reasons why a digital transformation can fail. Namely, some businesses can make typical mistakes either when preparing for digital transformation or directly in the process.

To help you navigate these pitfalls, we have prepared a list of the most typical mistakes made when undergoing a digital transformation and some ideas on how to avoid them.

Mistake #1: Lack of focus and failure to prioritize your digital transformation efforts

When it comes to digital transformation, “the why” is pretty obvious: it gives you a competitive edge through a better customer experience, allowing you to cut expenses while optimizing your business performance.

However, most businesses still struggle to figure out “the what” and “the how”: what should be changed in order to obtain those benefits and how to do that.

The solution: To make sure you’re on the right track from the very beginning, develop a clear roadmap for your transformation. Following the key steps for a successful digital transformation, you will be able to define your business objectives for digital transformation, come up with the corresponding solutions, choose the right means for their implementation, etc.

Mistake #2: Insufficient funding (or lack thereof)

As with other IT projects, most digital transformation initiatives fail simply because the organizations run out of funds too soon.

The solution: There’s only one way to keep your digital initiatives within budget: don’t set a limit on your transformation funding in the first place. Of course, you should estimate the required effort and plan your budget accordingly, but, at the same time, you have to understand that your digital transformation isn’t a type of project you can put a fixed price tag on.

In case the project goes off the rails and the costs keep piling on, you need to understand how it happened: was it because of a dishonest contractor that derailed the plans on purpose? Is a lack of proper planning to blame?

Another way to keep your digital transformation from running out of funds too early is to focus on safe-choice solutions so that the digitization effort funds itself. Simply put, you can introduce incremental changes or create a small consumer-facing product that will allow you to achieve a quick ROI.


Mistake #3: Unrealistic deadlines

As in the case of budgeting, you should understand that digital transformation is an ongoing process. That is why it is practically impossible to specify a completion date for such a project.

The solution: To keep your digital transformation on track, break it down to minor milestones and don’t rush it.

As a result, you will be able to better manage the deliverables as well as understand the pace at which you are moving. This will also keep your team from being overwhelmed with the sheer scope of the project.

Mistake #4: Moving too slowly

Remember, one of the reasons you started your digital transformation, first of all, was to keep your market share in the face of growing competition. Digitally-enabled businesses are agile and move fast. As a result, you simply can’t afford any delays.

The solution: Streamline your processes and automate the time-consuming tasks, where possible. For example, you can take the DevOps route to speed up your product delivery or adopt the test-driven development model to optimize the engineering effort.

Mistake #5: Fixing what isn’t broken

Digital transformation doesn’t necessarily mean changing every little thing about how you do business and spending years crafting a brand-new digital solution.

Sometimes, it’s enough to introduce incremental changes to your existing solutions or add several new products to your portfolio to hold your ground on the market.

The solution: If possible, try to identify the key problems with your existing solutions and solve them with minimum disruption to your business processes instead of rebuilding your business from scratch.


Mistake #6: Being too cautious

On the other hand, making incremental changes trying to fix the decades-old systems can sometimes be similar to putting a band-aid on a broken leg and expecting it to heal.

That is why bold decisions might pay out well in the long run. Namely, adopting a test-and-learn approach to innovation can be a winning strategy: it gives you a competitive edge over other more cautious market players.

However, this doesn’t mean you need to forget about common sense and put your business at an unjustified risk. It’s ok to go with your gut, but it’s even better to make your decisions based on reliable data.

The solution: Don’t be afraid to make bold decisions as long as they are informed and data-driven.   

Mistake #7: Trying to do it all yourself

It is quite understandable that most companies prefer handling business-critical initiatives like digital transformation in-house. Finding and managing third-party providers can be challenging (or even risky, as in the case of freelancers). Yet, only few businesses have the skills and expertise required for a successful digital transformation to be readily accessible.

That is why you need to understand that digital transformation is much more than moving your infrastructure to the cloud or building a customer-facing mobile app. Those are the problems most in-house IT teams can pull off.

Running a successful digital transformation, on the other hand, requires specific skills and relevant experience: from an expert CIO to cybersecurity specialists, as well as architects and DevOps engineers to business analysts: those are not skills that are easy to come by. So, having your in-house engineers (even the best ones) do the job simply won’t cut it.

The solution: Instead of assigning the new roles to the current staff members or sourcing the required talent in-house (which is both costly and time-consuming), consider hiring a dedicated team with a trusted provider.

As a result, you will be sure your digital transformation efforts have solid expertise to rely on and won’t go awry because of the lack of experience or skills.


Preparing for digital transformation: how to get started

Despite the many risks and challenges of digital transformation, the juice is well worth the squeeze. The benefits you obtain in the case of a successful digital transformation cannot be overstated: from higher customer satisfaction and competitiveness to new revenue channels and lower operating costs, there are numerous reasons why so many businesses make digital transformation their strategic priority.

If you are planning to transform your business but don’t want to put its very existence at risk, a perfect solution would be to hire professionals. An expert digital transformation consultant can guide you through all the stages of the process, from planning and setup to implementation and further support while reducing the risk of mistakes along the way.

Eastern Peak is a trusted digital transformation solutions provider that has helped future-proof a number of businesses worldwide providing them with professional guidance and unmatched tech expertise.

To talk about how our team can help you transform your organization, book a free consultation right now using our contact form.

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