What If You Don’t Digitally Transform and Just Keep Going As Is?

Everyone loves the idea of the new, out of nowhere winner or star. Yet you rarely hear about the decline of old organizations that perished because of a stubborn refusal to adapt.  Even stories about Sears, Kmart, Circuit City and others lack the appeal and motivation of the new digital superstars. But, digital transformation is a choice.

Imagine where Sears would be if they realized their catalog was the analog version of Amazon or where Walmart could have been if they embraced and turned their incredible infrastructure and buying power towards digital from the beginning. These examples cross every facet of business and even government, which could have been building more efficient functions that empower citizens through self-service. The vision, design and orchestration of digital transformations are conscious decisions around a framework and a set of new processes. History is always written by the winners, but there are hard lessons to be learned from those who stubbornly refuse to focus on the new and changing realities.

There are a lot of reasons organizations cling to the old ways. First, there is uncertainty in the future and if something is working today, it is hard to let go.  However, what you rely on today is not guaranteed to work in the digital age.  Think about these facts:

  • 55% of companies fear the potential threat from startups
  • 80% plus of organizations are undergoing some form of digital transformation
  • Most organizations are planning to fully embrace digital transformation changes in less than three years
  • Less than 25% were truly able to define what digital transformation meant

These statistics should give you pause as it shows many organizations may be doomed to failure and could become the Sears of their industry and generation. Further, these facts and others lay out the potentially tortuous routes to success over a very compressed time period. The question becomes, is no action a better path to success?

Through our research, we recognized seven drivers of digital transformation change. Just answer yes or no to start with:

  1. Are you seeing changes in supply and demand along with massive time compression effect your business?
  2. Are there shifts in the demographics of your customer base or their sense of entitlement that is changing how you must function to serve them?
  3. Does the fact that your customers, partners and competitors have far more access to information about you, your business, market and services change how you interact with them?
  4. Does the ability of your competitor to get scale for almost any function in your market or industry at a near drop of the hat cause you concern?
  5. Do startups present a real threat to your business in the next three years or less?
  6. Do you view the world as one where change is near constant and are you ready to handle whatever comes?
  7. Have you been discussing the paradox of lower costs and simultaneous real innovation occurring in your industry?

If you answered yes more than twice you should already be on a journey of digital transformation. Architecting and organizing your own transformation is critical. Failing to do so is like ignoring a major leak in the basement of your house.  For a few hours, the damage will be minimal. But within a day, significant problems will arise. Not only do you risk the basement and its contents, but you run the risk on not being able to sell the house or having to give it away for pennies on the dollar (just like Sears). No organization will collapse overnight by not digital transforming. However, inaction will start to squeeze market position towards start-ups or other organizations that are transforming. Additionally, you will see difficulty in recruiting or sustaining talent as they look to take their experience to those organizations that are thriving. Getting capital, merging or selling becomes increasingly difficult as the assets you once had become liabilities.

We cannot isolate ourselves from the inevitable changes going on around us. The enormous economic returns that could be expected from digital transformation based on organization’s social engagement approaches.  Those who opted for limited models or approaches, saw very limited results. The least engaged organizations saw low or isolated returns and over 50% of organizations saw well intentioned plans fail because of the way they organized for the changes.  It is worth noting that 16%, the minority, committed completely to the changes and the process needed to implement them; they were rewarded with the highest returns.

The speed of change is increasing and its impact will only become exponentially more powerful in the years to come. Deciding to digitally wrap versus digitally transforming is a conscious decision. There is too much evidence around you that you cannot really ignore it. Asking yourself, “what if we just kept going as is,” ignores how much you need to take charge of your situation.


Have you read?

The Digital Helix: Transforming Your Organization’s DNA to Thrive in the Digital Age by Michael Gale and Chris Aarons. [Greenleaf Book Group Press, October 3, 2017]

Michael Gale

Michael GaleVerified account

Michael founded Strategic Oxygen in 2001, which was widely seen as one of the technology industry’s primary data toolsets for marketers, used by over 20 brands and used to model over $4 billion in marketing and sales investments. The company was sold to Monitor Group, where he was a group partner from 2006 to 2010. In 2011, he became a partner at Pulsepoint Group, a digital consulting company, which was acquired by ICF in 2015. Michael has also served as chief web officer and GM at Micron Technology and was the vice president of Worldwide brand research at IntelliQuest
Michael Gale

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