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We’ve all heard the term digital transformation. But do any of us really know what it means? According to Tony Saldanha, the President of Transformant, most people within the IT universe don’t, and the confusion is causing a major issue for companies looking to embark on the process. Tony joined IT Visionaries to help bring clarity to the situation. He also discusses his book, Why Digital Transformations Fail, and the five-step process your company should follow when it embarks on its digital transformation odyssey.
3 Key Takeaways
- Digital transformations fail due to lack of discipline and language
- 70% of Digital Transformations fail because the term is nebulous leadership does not have a clear definition of the term
- Digital transformation cannot be delegated to the lower levels, it must be handled by the leadership team
For a more in-depth look at this episode, check out the article below.
The term digital transformation has always been ambiguous and fleeting. Organizations constantly say they are undergoing digital transformations, but what exactly does that mean? President of Transformant, Tony Saldanha, a globally recognized information technology and shared services executive and the author of the book, Why Digital Transformations Fail: The Surprising Disciplines of How to Take off and Stay Ahead, joined IT Visionaries to discuss why the term “digital transformation” is confusing industry leaders.
Digital transformation — the integration of digital technology into all aspects of a business — is a $1.7 trillion industry. But according to Saldanha, 70% of all digital transformations fail. And the issue is not technology, nor is it a lack of creativity from the organizations attempting to install them.
“Digital transformation is 90% an organizational change management issue and 10% a technology issue,” Saldanha said. “It needs to be strategically done differently and executed with slightly different methodologies than what the world executes today.”
So how should companies implement change and execute those methodologies? The answer lies within two words, discipline and language.
So is digital transformation the proper term? Saldanha said if he could reestablish the terminology, he would. According to Saldanha, the term operates in a haze and most executives don’t understand the true meaning of the phrase or fully grasp the mission they are embarking on.
“The reason why 70% of digital transformations fail is because the term is nebulous and the methodology, therefore, that’s being used is not disciplined,” Saldanha said. “My mission is to explain to the world that digital transformation is the effort that the world needs to take organizations and individuals that were very successful in the third industrial era and rewire them so that they’re successful in the fourth.”
To help ignite the process, Saldanha penned the book, Why Digital Transformations Fail: The Surprising Disciplines of How to Take Off and Stay Ahead in 2019.
“Once you start to see why digital transformations fail, you’re left with a checklist of how to make them successful,” Saldanha said.
That checklist includes five distinct stages that Saldanha believes companies should follow to increase their chances of success. The first stage is the foundation, or automation of activities. The second and third stages are siloed transformation and partially synchronized, when organization leadership sees a need for a single strategy. The fourth stage is full synchronization, when the organization has achieved its full transformation. The fifth and final stage is living DNA, when the company not only changes its business model but it’s culture as well.
Within the same context, Saldanha provided insight as to why organizations fail to accomplish their goal of digital transformation, placing an emphasis on over-delegation.
“Digital transformation is no longer a responsibility that you can delegate to lower levels in the organization,” Saldanha said. “I strongly believe that the board of directors and the CEO have the accountability to do that. They don’t have to have the technical skills to do that, they don’t even have to run the project plus money, but they cannot delegate. The over delegation is one of the reasons why many digital transformations fail.”
A second issue Saldanha sees is how the role of the CIO has changed over the years, driving home the notion that CIO’s are expected to be a boardroom and company strategy enabler, not just a technology leader.
“It’s our job as the new CIO to essentially share with people and educate them on what’s possible,” Saldanha said. “And then, of course, lead the execution.”
For a more in-depth look at Saldanha’s five-stages of digital transformation and a deeper dive into his book, check out the full episode of IT Visionaries.