Is It Time to Stop Harping on "Digital Transformation?"

If one defines digital transformation “as the integration of digital technology into all areas of a business resulting in fundamental changes to how businesses operate and how they deliver value to customers,” you can see why it is so hard to measure. 

DX affects “all” of the business; produces “fundamental change” in “operations and value” creation, it often is said. How often does any single technology change or program affect “the whole business?” How often does any technology program produce “fundamental change” in operations or value creation? 

Also, by that standard of “fundamental change,” many industries arguably already have achieved most of the value of DX. If “value for customers” is correlated with “how we make our money,” then content businesses and many retailers already have succeeded, for the most part. They sell online; they fulfill remotely; they handle customer interactions online. 

CaixaBank Research

 

Many other industries, such as marketing, consulting and research, likewise largely rely on online processes and fulfillment. Other industries possibly cannot pursue “fundamental transformation.” 

The qualifications, such as saying DX “will look different for every company,” only highlight  the problem. DX requires technology, to be sure, but also cultural change. And how do you measure that? 

Some might say DX requires a “culture of experimentation; a willingness to fail or an ability to successfully challenge older ways of doing things.” Some of us would say success in any single one of those areas will succeed only about 30 percent of the time. 

So what people often do not expect is failure. And there is no reason to believe any single effort at some part of DX will succeed more often than three times out of 10. 

source: BCG 

The e-conomy 2022 report produced by Bain, Google and Temasek provides an example of why DX is so hard to define or measure. Literally “all” of a business, all processes and economic or social outcomes are linked in some way to applied digital technology. 

And what we cannot precisely quantify or measure is hard to track or monitor. If one thinks of DX as simply the latest description of “applying digital technology” to processes, then one also understands why there actually is no end point. We simply keep evolving our technology use over time. 

source: Harvard Business Review 

We should not expect people and organizations to stop talking about “digital transformation.” But maybe we shouldn’t listen quite so much. 

Yes, by all means continue to experiment with new ways to apply internet, communications and  computing technologies to improve operations, product value and customer interaction capabilities.

You know, like we always have done.