A digital catch-22: after the crisis, who’s betting on digital transformation?

Many organisations attempt digital transformation, but failure is five times more likely than success. Digital transformation is not a piece of cake. It requires redesigning the whole organisation and involves large-scale change. Being slow to adopt digital technologies may reduce risk in the short term but builds growing business risk and reduced competitiveness in the long term. And this trend will be repeated and magnified by the growing adoption of automation and ‘AI’ over the next five years. Leslie Willcocks writes that there are ways out of the digital catch-22, but senior executives responsible for digital transformation will need to take a much bigger view of the change process, if the potential business value of digital investments is going to be realised.

 
Today’s organisations are facing a digital catch-22. On the one hand, digital transformation is difficult and costly, and short-term investment may be needed elsewhere to where it’s really hurting. On the other hand, today’s organisations cannot afford not to become tomorrow’s digital businesses. In this article I will point up the dimensions and intractability of this digital catch-22, before suggesting some ways forward.

But not so fast; firstly, what is digital transformation? Digital transformation requires digitisation – converting something non-digital (e.g., a health record, an identity card) into a digital format that can then be used by a computer system. Digital transformation also requires digitalisation – enabling, improving, or changing business operations, functions, or activities by utilising digital technologies and using digitised data to create management intelligence and actionable knowledge. All three—digitisation, digitalisation, and digital transformation—are needed to build a digital business. Digitisation and digitalisation are necessary but insufficient. My academic colleague George Westerman put it rather well: When digital transformation is done right, it’s like a caterpillar turning into a butterfly, but when done wrong (or we might add, incompletely), all you get is a really fast caterpillar. Digital transformation must focus on the whole organisation, and large-scale change. It involves radical redesign, then deployment of business models, activities, processes, and competencies to fully leverage the opportunities provided by digital technologies. I would guess you already have some idea of why it is so difficult.

 
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Πηγή: blogs.lse.ac.uk