Transformation Is Almost NEVER About Technology

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I wish I had a nickel (yes that would suffice) for every time a client told us that a new technology they were considering was going to completely transform their business.  We have been led to believe that “Digital Transformation” is the silver bullet that will take our businesses to new heights (mostly by the consulting community).  A recent HBR article “Digital Transformation is NOT About Technology” notes that “a recent survey of directors, CEOs, and senior executives found that digital transformation (DT) risk is their #1 concern in 2019.”  And the article further notes that “70% of all DT initiatives do not reach their goals.”   I challenge you to “google” this – “how often do change initiatives fail” and that same 70%  will come up time and time again from multiple experts (including those experts that are creating the “digital transformation” hype). 

I am NOT a technology expert, but I have helped many companies select and implement major new technologies.  I would argue, first, that even implementation of a major new system like ERP (e.g. SAP) in and of itself was not “transformational”.  If that new technology enabled (that is what technology IS – an enabler) a completely new way of doing business, then maybe it was “transformational” but that is rarely the case.  In addition, in my opinion the difference between success and failure has NOTHING to do with the technology itself.  Success is dependent on having a clear business strategy to start and ensuring that you are extracting the value you expected to get from the technology – which can ONLY be accomplished through Adoption.  I have clients that are implementing their third Source to Pay system (e.g. Ariba, Coupa, Zycus, etc.) hoping (fingers crossed 😊) that this one delivers that silver bullet.  My guess (it’s more than a guess) that they had not adopted the full functionality the first time or the second time so I’m not quite sure why they think the third time is the charm.

We all know the definition of insanity is “doing the same thing over and over and hoping for different results”.  THIS is where the 70% failure rate comes from.  We hire armies of consultants ($$$$$$$) to “apply one-size-fits-all solutions in the name of best practices”.   By the way, it is in the outside consultants’ best interest to stay with you as long as possible which is why so many of these implementations (I refuse to call them transformations) take so long. We, at The Mpower Group, are NOT in the business of doing these large-scale implementations but are often called on to advise our clients on how to make the “transformation” happen.  The first two questions we tell them to ask their implementation partner IS – where is the Change Management plan? And where is the Adoption plan?  I am STILL amazed that our clients need to ASK when this should be the starting point – right after the business strategy and business case (to ensure the technology is enabling the strategy).

The lessons offered in the HBR article are insightful and you should take the time to read it.  But in a nutshell – success IS all about Change Management and Adoption.  As your organization is looking to take the leap into Digital Transformation (and you all will eventually) make sure you are focusing on the right things and asking the right questions.  Just like every Sourcing process is basically the same (whether it is 5 steps, 7 steps, etc.) so too are many of the emerging digital technologies.  It’s less about which technology you choose and more about how you choose to use it or NOT.

Join in the conversation and let us know what you think. . . .

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Anne Kohler
Anne has been leading consulting and financial management organizations for over 25 years. She has extensive expertise in Strategic Sourcing, change management, contracting & contract management (both the buy side and sell side) organizational design and supply chain management. Anne has a passion for collaborating and educating her clients while helping them to uncover hidden value in their organizations. In addition, Anne has been named by Supply & Demand Chain Executive as a “Top 100 Provider Pro to Know” every year since 2007 and a 2013 Top Female Supply Chain executive.
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