“Most implementations are considered IT projects,” says Tim Hertzig, head of Deloitte’s technology practice and global product owner of Deloitte Ascend digital transformation solutions. “These projects fail to achieve the value they initially aspire to because they do not consider change management to ensure adoption and do not consider industry best practices.”
Technology alone rarely creates value, according to Kristi Kaplan, president of Deloitte and U.S. executive sponsor of the Deloitte Ascend platform. “Rather, it is how the technology is implemented and adopted by the organization that actually creates value,” she says. Executives need a long-term change plan to deliver business results that gain momentum, not fade away.
According to an analysis by Deloitte, the right mix of digital transformation activities could create up to $1.25 trillion in additional market capitalization across Fortune 500 companies. On the other hand, implementing digital change on its own without aligned investments in strategy and technology (“digital random acts”) could cost businesses $1.5 trillion.
Implementation Best Practices
To realize this potential value, Deloitte says there are a number of best practices that leading companies use to successfully design and execute digital transformation. Three things stand out:
Ensuring comprehensive governance: Project governance must encompass business, HR, finance, and IT stakeholders to ensure transparency in reporting and decision-making to maintain momentum. Successful projects are jointly owned. All executives understand where they are in the project life cycle and what decisions need to be made to keep the program moving forward.
“If transparency isn’t there, or if all stakeholders aren’t on the table and don’t feel a sense of ownership for these programs, IT organizations can end up driving the business transformation they really need,” says Kaplan. “If business leaders don’t own change management, technology adoption, organizational reskilling, etc., their risk profile is much higher.”
“Executives need visibility and assurance that the ROI of their technology investments is being realized, and if there are risks, they need transparency before issues escalate into full-blown problems,” Hertzig added. “This transparency is built into the governance rhythm of the organization.”
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This content was produced by Insights, the custom content division of MIT Technology Review. It was not written by the editorial staff of MIT Technology Review.
