It’s nearly impossible to quantify the change that’s occurred in the last year. It seems as if every aspect of our lives has felt digital transformation. In the business world, especially, this transformation cannot be understated.
In an effort to better understand the impact the COVID-19 pandemic has had on organizations across industries, my team at Quick Base partnered with Harvard Business Review Analytics Services on a second research report titled Reevaluating Digital Transformation During Covid-19.
This report follows our previous report that introduced the dual-track approach to digital transformation, which is a strategy that combines enterprise-wide transformation efforts with rapid-cycle innovation, a tactic that empowers business people outside of IT to quickly propose and create applications that modernize the processes they perform every day. What we found is that there are key differences between organizations that have already implemented this approach and those that have yet to do so. These differences have been instrumental to the success of the organization’s operations in the period following the coronavirus outbreak.
Distinguishing Digital Transformation Leaders from the Rest
Of the 527 global executives surveyed in this second report, 91% reported that their organizations have altered their operating models because of the COVID-19 pandemic, with 33% going so far as to describe this change as “significant”. Similarly, business priorities also had to shift during this era of uncertainty. 53% of organizations said that their primary business goal now is to improve business continuity and resiliency, marking a 33 percentage point change prior to the outbreak.
Despite a majority of organizations now prioritizing business continuity and resilience, our research uncovered significant discrepancies in the success of different organizations’ transformation efforts. Transformation leaders were distinguished as the 27% of organizations that rated their transformation strategies as “very effective” both before and after the COVID-19 outbreak. Meanwhile, the 50% who reported these strategies as “somewhat effective” and the 23% who said “not very effective” in both periods were identified as follower and laggard organizations, respectively.
What can we attribute to the success of leader organizations? Among several factors, one that particularly stands out is that leaders are significantly more likely to implement the second track of dual-track transformation: rapid-cycle innovation. In fact, our research shows that the implementation of rapid-cycle innovation maps to transformation success. 73% of leading organizations reported that they use or plan to use rapid-cycle innovation within the year, as opposed to only 52% of followers and 35% of laggards. Leaders were also most likely to take advantage of this tactic throughout every corner of their business – 26% said that they use rapid-cycle innovation across their enterprise, compared to only 7% of followers and 3% of laggards.
Best Practices from Leading Organizations
Our research has uncovered some of the proven strategies used by leading organizations for achieving digital transformation success. The following four lessons comprise the framework leveraged by these highly successful organizations to ensure the effectiveness of their digital transformation – in any circumstance.
The first lesson is to create a foundation for ongoing transformation that’s rooted in executive commitment. Leaders know this – over 60% of them report having senior executives who are highly committed to implementing rapid-cycle innovation. Buy-in from management, where the resources are provided, is a necessary first-step to deploying a successful digital transformation across the enterprise. It ensures that the people in your business can access the appropriate tools and trainings to make change happen.
Secondly, leaders warn to avoid ad-hoc approaches to rapid-cycle innovation. The effort should be deliberate, spearheaded by an innovation point-person (such as a business improvement manager) to champion the effort. 49% of leading organizations use this method. The role of the innovation point-person isn’t to implement innovation, but instead to build innovators. Not only do they serve as a liaison between executives and people in the business, but they act as a talent magnet – attracting and training high-performers who are ready to modernize their roles.
The third lesson has to do with technology. By employing low-code tools throughout the business, achieving business resiliency becomes a reality. Low-code platforms democratize software development, so even people without a technical coding background can create and deploy applications that modernize the processes they rely on every day. In fact, 73% of leaders are currently capitalizing on low-code development, whether in a single department, or across the entire organization.
The fourth and final lesson from leaders is to invest in your organization’s culture surrounding digital transformation. For change to stick, you need support from people in the business. But this can be easier said than done, as transformation can be met with resistance from people who are hesitant to change the way they work. But by fostering a culture that invests in its people by building them up to be innovators in their role, they become an essential component to the entire organization’s transformation efforts.
In addition to updating policies to support digital transformation and rapid-cycle innovation, companies should focus on building a relationship of trust between IT and business units to encourage collaboration. When working effectively together, this partnership can be a major force for change -- IT can better understand the needs of the business and people in the business can better understand how technology can be used in their jobs.