What Digital Transformation Is Actually About

After I published an article about what Digital Transformation is NOT, a lot of people told me that I am now obliged to explain what it actually is. Over the last few years, I have tried a lot of different definitions, but, I have to admit, with little success.

That’s my own fault, I know. I just haven’t been able to find the right words yet. So I posted an innocent question here on LinkedIn.

Digital Transformation: Who is able to give a definition of DX which an ordinary mortal can understand?

I don’t know what happened. I must have pushed a button.

Digital Transformation Happens. Right Now.

I think everyone in the discussion agreed upon the fact that digital transformation is a phenomenon that is happening globally right now. Open your eyes. It is all around us. Our world is transforming digitally. Smartphones, broadband, new services.

When I was a child, people would use phones to call a place. A household, an office. You had to hope that someone would pick up the phone. Remember answering machines? Digital technologies have finally got it right. People want to call people, not places or machines.

Organizations hesitating to keep pace with all that global change are facing massive problems. The most obvious problem is that they are being disrupted by non-traditional organizations entering their market and better satisfying people’s needs. Look at Uber, AirBnB, or Netflix.

Empowering People

True digital transformation empowers people. We are not only talking about customers. In digital transformation, everyone is joining in. By giving feedback on solutions. By delivering usage statistics automatically. It is important for people today to be part of the change.

Without creative, passionate people there is no transformation. And traditional organizations unfortunately have been creating working environments that don’t attract them. Creative, passionate people are entrepreneurs themselves. That’s why organizations are founding their digital hubs and innovation units in an effort to open up space for creativity.

It is important to bring together people from business units who have a deep understanding of the industry, IT people who have a profound knowledge of the existing IT landscape, and engineers, designers, and researchers. Without such cross-functional teams consisting of internal as well as external experts, digital transformation will not happen in an organization.

People’s Experience

Digital transformation changes the way we perceive the world around us. Technology has become deeply connected with our lives. Ten years ago, we were fascinated about what we can do with technology. Today, using technology has become a natural thing to do. What we care about now is how it feels.

Remember those times when you needed a training course to be able to use a piece of software? Those times are over. That’s why digital transformation without user experience research and design is just not possible.

Any piece of technology that is not exceptionally well designed will just not be used. Everyone uses Gmail, WhatsApp, Instagram, LinkedIn. Any digital product launched either inside an organization or to the public that offers less “joy of use” will just be ignored by us, the people.

Organizational Change

Hand in hand with empowering people through digital technologies needs to come an organizational change. Rigid hierarchies have a tendency to slow everything down. Matrix organizations do better. But agility isn’t something that can be “applied”.

Achieving cultural change is definitely the hardest part for traditional businesses. They tend to think of digital transformation as an initiative with a limited period and budget. It’s not. Once an organization starts to transform digitally, there is no way back.

That’s also the reason why buying a successful start-up will not transform your organization. Start-ups are “born that way”. They don’t need to transform. In the worst case, start-ups adapt traditional business culture.

Reimagine Business

The digital era didn’t start yesterday. Many organizations are digitized. They have tried to exploit technology to enhance the way they do their business ever since. But very few – only the courageous and brave – have actually thought about creating something new with digital technologies at their hands.

And courage and boldness have been rewarded. Today, we see companies that didn’t exist a few years ago tearing apart whole industries. That’s why digital transformation won’t work without reinventing business, bearing in mind all the changes that everyone can see coming.

Have you seen car-sharing services in major cities recently taking over? Are you thinking of just giving up your car? No more cleaning, changing of tyres, horrendous repair shop bills, expensive car insurance. You are not alone. Will this force insurance companies to change their business models? You bet it will.

Technology

In my personal opinion, technology goes last. Once an organization has overcome the major challenges of its digital transformation, developing products or services is not hard to do. I don’t think that “understanding technology” is important at all.

What is important, though, is to understand the effect technological change has on society, the environment, and civilization. It is important to observe what’s going on around us and reflect upon it. If we are curious, we find others who are like-minded. That’s how start-ups are founded.

Wrap Up

If you scroll through the discussion thread of my post, which was supposed to help me to find a definition, you’ll find a lot of definitions along with links to blog posts, charts, and even comics.

It is just a ton of great resources and I want to thank all those bright people for joining in and sharing their valuable knowledge.

Also, I thought that the discussion would provide enough material to write a book on the topic. But then I realized it has been done already!

Therefore, I am quoting Lindsay Herbert here. I’ve taken her words from the short promotional video she did for her new book.

“Digital Transformation really just means being more adaptive to change itself.

It’s about using digital technologies and ways of working that have been brought about by the information age to understand the change that’s happening around an organisation.

And it’s about to be able to react on it on a much more dynamic and rapid basis than organisations have ever used to be working before.”

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About the Author

Roland Rust

Roland is a digital product innovator and entrepreneur. He has been working with corporate clients over the last 15 years, helping them to master their digital transformation journey. Among other achievements, he has been leading the implementation of a game-changing digital business model in the manufacturing industry. After running a tech start-up for five years, he specialized in developing software prototypes in small UX design-driven teams.