87% of companies are in the process of transformation, but are unsure of what the end goal is, Globant found.
The majority (87%) of organizations are in the process of transformation, but are either not seeing results or are unsure of the end goal, according to a Globant report.
While companies are told transformation is critical for business survival, they aren't given the proper guidance for how to successfully undergo these changes.
SEE: Digital transformation road map (free PDF) (TechRepublic)
Globant's Sentinel Report, released on Monday, attempted to solve this problem by offering five guiding steps for businesses experiencing transformation.
The end goal for most transformations is to optimize business value, so the report identified five non-traditional ways companies can achieve relevancy through optimization.
"We focus on non-traditional ways because we understand that organizations going through a transformation need to adopt a mental model of forward thinking to gain momentum," said Emiliano Horcada, strategy partner at Globant. "Using traditional methods will only yield the same results."
5 non-traditional steps
With the average life span of companies being under 20 years, staying relevant is more important than ever.
1. Transformation on the streets
"Very often, we see companies want to get the results of a transformation, but don't want to go through the process," Horcada said. "They don't have a plan for the transformation that matches their purpose, and when they get to that plan, it feels so big and intangible."
Mature organizations have clear, digitally driven business goals (28%) and prioritize people. More than half (52%) of leaders said they believe collaboration across departments is the most valuable capability for digital transformation success, according to the report.
To set digitally driven goals and gain support across the organization, the report suggested starting small. Look at one ordinary task that happens every day, and find a way to make it 10% better. This small success helps leaders gain credibility and encourages coworkers and stakeholders to jump onboard for bigger projects, the report found.
"When companies start small and choose one opportunity within the organization, prototype it, co-design it with customers and iterate on it, that seed of change is sustainable and actionable. When organizations start small, they can see results through change, not just speech," Horcada said.
"This promotes a culture of experimentation that leads to innovation. When companies allow their teams to experiment, make errors and move on, innovation happens sustainably," he added.
2. Eyes on the prize
Goal-setting is critical to success before, during, and after transformations, the report found.
Employees in organizations undergoing transformations should define their goals and become co-owners of these goals, checking in on progress regularly. This practice helps create accountability and agency for all employees, according to the report.
"We see that a majority of transformations fail due to a lack of visible and flexible action plans, which indicates that success is not part of the vision," Horcada said. "We see that the only way to keep focus, adapt and grow in the right direction is through effective work dynamics, which provides visibility and enables people to achieve results with their efforts."
3. Put the data to work
Data unlocks insights and yields metrics that can show gaps and progress in company operations. Neglecting this data only hurts the company, the report found.
"At this point, we so clearly see that companies who don't invest in organizing, curating, integrating and enhancing their data are losing opportunities left and right. We need to look at the data within our companies as the most precious resource available," Horcada said.
"We need to make a habit of collecting, curating and interpreting data all around us. Through data, we can create added value for our customers, increase conversion in our sales, develop new products and services and disrupt our industries. The potential is endless," he added.
The report recommended first looking at the origin of the data an organization has, as this can help improve the processes making use of the data. Companies should then use this data to help improve the efficiency of operations and analyze the impacts this could have on the whole business, according to the report.
These metrics can act as a crucial benchmark for success, displaying where transformations are working, lacking, or hurting projects, the report found.
4. Keep talent alive
A lack of workplace recognition is one of the top reasons employees quit their jobs, but talent is critical for transformation success, the report found.
"Usually, when companies talk about the ROI of transformation, they talk about revenue, margins and traditional metrics. However, we see that the ROI of a transformation goes beyond those metrics," Horcada said.
"The value of a company lies first in the talent that it is able to attract and maintain. Organizations must focus on creating the right culture and reinforcing healthy behaviors that drive innovation, like collaboration, experimentation, and curiosity," Horcada said. "Talent is the immune system of organizations, and these behaviors will prevent bad influences from reaching the core of the business and allow the organization to grow in the right direction."
Companies need to prioritize every member of the organization during major changes, elevating them to "protagonist status" and creating a culture of co-creation.
During chaotic business shifts, it's easy for people to feel left behind or forgotten about; to combat this, companies should ask employees regularly for their opinions and ideas, according to the report.
5. Think outside the box
The competitor landscape for all industries have ebbed and flowed over the past decade, but most companies still use the same practices. Especially with the ever-changing tech market, businesses must evolve to keep up and stay relevant, the report found.
A few ways companies can spark change involves thinking outside of the box. The report found that businesses can do this through experimentation with ideas. Leaders should survey employees for ideas and try some out, the report found.
"The truth is that in this digital age, the customer is not comparing you solely with your competitors, but with previous satisfactory experiences they've had, regardless of industry," Horcada. "When we say 'think way outside the box' we mean, think outside your industry, and see how your customer is being shaped by relevant experiences."
Another way to help businesses evolve is by using cross-industry innovation, especially with technology. If there is a practice that seems outdated, businesses should look for technological solutions to help, because they most likely exist, according to the report.
"Transformation is not an event. It is not something that happens once—it's a constant activity, and if you're doing it right, you will never stop evolving," Horcada said. "Company leaders need to surround themselves with people, partners and a team that shares the same mentality, and challenge the status quo constantly to see success."
Combining these five strategies will help organizations stay competitive, relevant, and alive, the report suggested.
For more, check out Why being a data-driven company isn't enough on TechRepublic
This article was updated on January 14, 2020 with comments from Emiliano Horcada.
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