Blog 13 December 2022

Does the thought of digitally transforming make it too tough to start?

by Richard Higginbotham


Digital Transformation continues to be presented as a priority for businesses worldwide. And each year the volume of published content on the subject grows. But if the pressure to digitally transform is such a priority, why isn’t everyone making more progress? 

Google Trends: ‘digital transformation’ and ‘cloud technology’ over past 5 years in the UK
Google Trends: ‘digital transformation’ and ‘cloud technology’ over past 5 years in the UK

The pressures on organisations to digitally transform is not going to diminish. The word ‘transformation’ implies massive change. In the business context, it suggests wholesale change to processes, structures and capabilities. Then there are new ways of working, which call for skilled development resource, staff upheaval, new systems and large investment. So, the results better be worth it!

Risk vs. return

The pressures for business to change are enormous and, to an extent, irresistible. 

Yet research suggests the risks are significant. Research from McKinsey in 2019 highlights that roughly 70% of transformations fail. And more recent research from Boston Consulting Group reaches the same conclusion.

70% of digital transformations fall short of their objectives, often with profound consequences

Big efforts, big investment, lots of pain – yet with significant risk. Why start? 

The drive for efficiency

Digitising processes increases productivity – delivering efficiency and creating capacity. 

Yet rising costs — the knock-on effect of the energy and cost of living crisis — are squeezing margins.  With three-quarters of UK businesses struck by labour shortages, there’s intense pressure to get more done with less (and, in many cases, for less). 

Operational resilience

If the last decade has taught us anything, it’s that organisations must be able to adapt and respond to disruption, in a timely and effective manner. By automating processes — and adopting a more flexible and decentralised IT architecture — they can vastly improve agility and improve recovery time. 

Customer experience and changing behaviours

Technology and consumer preferences for digital experiences were already changing before the COVID-19 crisis. The lockdown experience accelerated this shift massively. Now, the coming of age of Gen-Zs is added to the equation. As customer care migrates online, organisations must adapt systems and ways of working to accommodate the move.    

On top of this, customers view their experience holistically. They expect a consistent, personalised and quality experience regardless of touchpoint. This blurring of lines between digital and live interactions calls for more data integration — and breaking down of functional and application silos. 

Competitor activity

Organisations that harness digital technologies faster than their competitors, have a significant advantage over laggards in their sector. BCG research shows earnings growth in ‘digital leaders’ as 1.8 times higher than those falling behind. 

And that means they’re losing out on the benefits of productivity improvements, better customer experience and business model innovation, during an economic downturn.  

Success when the going gets tough

If being able to digitally transform is not an option, but the risks are high, how do you flip the odds in your favour? And how do you embark on the journey with confidence? 

You need to think differently. Transformation is large-scale and organisation-wide – but digital can be applied at a smaller scale to deliver quick results. To identify where to start, think ‘digitisation’ — where you can apply technology to improve a process, that was done manually before. 

It’s about turning ‘Macro’ transformation into a series of ‘Micro’ transformations. 

Small changes. Big results

There are many advantages in this approach. Small changes make it possible to reduce cost and accelerate pace. How? By using technologies that can work with existing systems, and avoiding the need for wholesale technology change.  

Smaller change, managed in ‘line of business,’ makes it easier to involve staff in the process.  When you engage frontline staff, you build knowledge of the ‘art of the possible,’ identifying further opportunities for automation and improvement. 

Intelligent Automation and focusing on digitising processes make the journey a great deal less overwhelming. And that success creates momentum — as you work iteratively to reduce risk. Then, as confidence, skills and knowledge grow, it becomes easier to see the way forward. 

AI-powered low-code platforms, robotic process automation and omni-channel contact centre solutions make it possible to start small, deploy quickly and scale fast. These technologies bridge the gap between siloed legacy systems, providing significant opportunities for digitisation. Technologies like our own Liberty Platform empower clients to start, iterate and scale their digitisation efforts – making significant progress on their transformation journey. 

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