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What are the Success Factors for Digital Transformation?


For any firm or business client, a digital transformation initiative is intended to improve processes, data, reporting – or any combination thereof – using technology-enabled means.

Oct 22nd 2019
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At our firm, our advisory team consists of product-agnostic systems advisors. We don’t resell or implement any software; rather we are retained to ensure that risky systems projects, which are also digital transformation initiatives, end successfully.

These initiatives start with establishing project governance parameters, development of project charters and project plans. These continue into documentation of key functional requirements, evaluating and selecting vendors and eventually implementing and optimizing the solutions.

The contents of this post can apply to many industries and a wide array of digital transformation initiatives. As a CPA, this may apply to initiatives your firm undertakes as well as to situations where your clients may be undertaking one, as well.

Level Set: Have You Been Through Digital Transformation Initiative?

If so, what factors impacted its success (or failure)? Consider what went well, what didn’t, and how you could have improved the situation had you known the outcome in advance.  Perhaps you’ve been burned by a bad implementation or misleading software sales experience.

Maybe a project that never finished went way off track and exceeded budget. In such case, you’d likely have pitfalls and warnings solidified in your memory.  Or perhaps you’ve had a positive experience with a complex technology initiative. If so, you’re in the minority. 

Either way, I’m sure that you’d agree that having a productive, collaborative and respectful relationship with software integrators and vendors is among the table stakes, right?  There are other factors that impact success, which are enumerated in this post.

However, let’s set the record straight in that some of the larger software companies are focusing more and more on the success of their customer experiences.  Within the last two years, I had the opportunity to lead discussions with distinctly different audiences while presenting at executive meetings held by two of the largest ERP and CRM software publishers.  Each meeting focused on ERP and CRM Project Success Factors.

The audiences were owners of ERP and CRM software implementation firms and sales executives responsible for ERP and CRM sales and client success.  I’m happy to report the meetings were productive, constructive, very interactive and ended with everyone in sync on the success factors that I’m about to share.

Before I do, however, think about the responses to the question asked above before you review our suggested success factors below and see how much we are in sync. What follows are the factors we’ve learned through many decades of experience to be most critical to success of digital transformation initiatives.

4 Leading Success Factors for Digital Transformation Initiatives

1. Clarity of Purpose

Be clear about what you’re attempting to accomplish, and establish the intended results that you expect to achieve. Define your scopes, including areas most impacted and not. And, assess your risks of achieving your results.  And, be clear about whether your functional and business requirements include changing processes, or not.

2. Leadership and Managing the Change

Most ignored, yet among the top 2 reasons for failure. Your initiative must be sponsored by executives who are going to endorse, provide resources, and ensure that the disruption to the business is best planned for, and achieved. It takes guts to take on Digital Transformation initiatives, considering how often they run off the rails and never get done. Establish a plan, a charter, and develop a Change Management strategy using internal Organizational Development professionals. You’ll focus on preparing your organization at all levels, and build more effective leaders at the same time. And, assess how your unique culture will fit with the approach and personnel from your key vendors.

3. Experience, Team and Technical Skills

If you’re undertaking a Digital Transformation initiative without team leaders with experience in working on these types of projects, please stop. Hire or retain personnel who have been through this sort of thing. And, be sure that your team represents the right business functions and have requisite skill and authority to commit the organization to changing business processes. You need to bring your “A Team.”And, frankly, so do the vendors.

4. Product (yes, it’s last)

Although people and leadership, planning and strategy are listed above due to their higher impact on success, let’s not forget about the “products” you are seeking to implement in your digital transformation initiative.  For most organizations, there are multiple offerings in the technology market from which to choose – choose wisely, based on independent research and be sure to seek the right integration/implementation professionals to help with making the product(s) work for your organization.

Final Thoughts

About to undertake a digital transformation initiative or are dealing with an initiative that’s going in the wrong direction? If you’re headed into - or are struggling during - the experience, you may want to pause and consider how to rethink your project, strategically. Pay attention to the key factors listed above: People, strategy, clarity, direction and communication.

These are words we all know but, keep them posted on the white boards in your offices. These projects by nature are disruptive. Taking a planned and mature, strategic approach can mitigate your risk of failure. Hire the right personnel, or seek professionals. Good luck!

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