In this article, we are going to look at 4 important steps to become a digital organization.
The ongoing digitalization that is taking place in today’s time has a huge impact on our lives and the business world. To survive in the digital age, companies must initiate digital initiatives. Therefore, digital leaders have to embrace a digital mindset first since they are the ones who have to lead these changes. From there, the way to turning a company into a digital organization is not that far anymore. What you need to do is building and enabling digital across the entire company.
In this regard, four di aren’t aspects can be distinguished, three of them lying within your company’s responsibility and one being influenced from the outside:
Table of Contents
- How To Become A Digital Organization
- 1 Alignment. The Management Part Of The Digital Organization
- 2 Identity. The Leadership Part Of The Digital Organization
- 3 Operations. The Execution Part Of The Digital Organization
- 4 Politics. The External Influencers Of The Digital Organization
How To Become A Digital Organization
1 Alignment. The Management Part Of The Digital Organization
The alignment of a digital organization is done by a digital strategy and corresponding processes. It is the everyday management of business.
It is hard to become successful as an organization without establishing a proper strategy. How should people know what is right and wrong if they do not know the way? It is, therefore, crucial to plan a strategy that outlines and shows the bigger picture.
Even though strategic management includes expert knowledge and analysis, the key to a good strategy lies in the way organizations translate their strategy into common language. Summing it up in easy words helps people to understand what they should do and why their contribution matters — the basic need of a digital organization.
After having built a digital strategy, you need to ensure that you enable your organization to act digitally. This is done by analyzing the points of intersection within your value chain creating the most value for the business. Identify your company’s possibilities for digitalization, priorities and optimize them and spread from there. You will never be a digital organization if you have digital processes that are not of any value. Furthermore, you will neither be a digital organization if you just digitalize any process. Digitalising a bad process will only result in a bad digital process. Get the foundations right from the beginning.
2 Identity. The Leadership Part Of The Digital Organization
Leading a digital organization requires a strong culture and motivated people with a digital mindset. Thus, creating the right identity is crucial.
Designing a strong company culture is di cult but possible. Culture is something unique, and differences from organization to organization. Even within an organization, culture is not homogeneous. The event sub-cultures within teams, departments or projects have their rules and dynamics. A good start is to embrace the pillars of the “Digital Mindset” and combine them with the individual culture. Just make sure that the elements within your culture do not disagree with each other.
People make culture, and that is why digital organizations have to grow their people (as you already know from the digital mindset). Embracing people to be part of the digital evolution can decide on whether your organization succeeds or not. Your people are the ones coming up with ideas and solutions. Hence, you will never enable a digital mindset if your organization does not focus on people. And without this, you will most probably struggle to digitalize.
3 Operations. The Execution Part Of The Digital Organization
And finally, the last aspect that lies within your area of responsibility is to implement digital within your organization. Your organization should be willing to do the right things and enable these with suitable technology and appropriate resource allocation.
Without action, nothing will happen. Just talking about digital does not get a company anywhere. A digital organization proactively takes actions to drive the evolution of their business model. Steadiness and consecutiveness are the keys to long-term success. Furthermore, having the ability to change will help to do the right things. Instead of trying to eat the whole beast of digitalization at once, split it up and start with a small chunk.
Digital without the right technology is difficult. Setting up data analytics without having a data lake or ELT processes does not work. The results will neither be of any value nor will they aid with the evolution of your business. You have to make sure the right technology is in place to unfold the full potential of your digital organization.
Transforming your company into a digital organization does not require acquiring completely new resources but rather reallocating existing resources appropriately. Workforce and budget must be allotted in a way that existing structures are leveraged and a holistic digitalization takes place along the entire value chain. Here, it is especially crucial to avoid wasting money, time and workforce by duplication of work. In many cases, this represents one of the major problems companies face on their way to digital.
4 Politics. The External Influencers Of The Digital Organization
Establishing digital alignment, identity and operations are your duty. However, your organization also relies on support by politics regarding the transition towards a digital economy to digitalize.
Digital technologies can facilitate information, communication and transaction processes. Governments should, thus, introduce such tools to improve the implementation of these processes — not only within public institutions but also between them and the business world. To ensure secure and appropriate usage of new technologies, politics must introduce certain regulations, and guidelines everyone needs to comply with.
Governments must engage in improving the digital competencies of current employees and future workforce. Especially prospective graduates need to be trained as digital an entity will become more and more important in all industries. This results from the digitalization of many professions leading to a transformation of job profiles. According to the 2016 annual report of the Stifterverband and McKinsey in the realm of the Hochschul-Bildungs-Report 2020, universities moan about the poor quality technological infrastructure which makes it difficult to prepare students appropriately for their future in the digital business world. Thus, politics should invest in better digital equipment at universities. Furthermore, governments need to play a major role in education initiatives.