Developing the right capabilities for digital transformation
One of the keys to the success of RPA implementation is to treat it as an ability, and not as a project. So said Rob Pretty, digital transformation expert and lecturer at the “Digital Transformation Online Summit 2019“, organized by EnterpriseMobilityExchange.com.
The idea of Pretty seems brilliant to me, because it touches one of the most frequent problems in the transformation of organizations: the lack of involvement of the work teams and, therefore, the poor or lack of development of skills within the organization. Steven Zobell, Chief Product and Technology Officer for Workfront, said in Forbes.com that in 2018 companies invested 1.3 trillion dollars in digital transformation initiatives. However, studies show that 70% of these initiatives did not reach their objectives, that is, 900 billion dollars were lost. What is the reason for this gigantic management failure? Zobell points out primarily two reasons: 1) We forget about work teams, and 2) We do not have systems to systematically record work.
“The success of the transformation depends entirely on the employees working together to achieve the objectives of the [Digital Transformation] program. The entire company, and not just a few people from the same team, must work together to drive success. Unfortunately, most organizations are isolated, with functional areas and business units struggling to communicate, coordinate and collaborate on transformation initiatives,” said Zobell. When organizations consider transformation as a project, it is common for managers to think that the transformation is someone else’s project, and mentally distance themselves from the goal: “It’s the problem of another area, another team, and when they need me they will summon me and train me.” This position is completely opposite to what is required by an automation and transformation process: identifying the key processes where initiating the improvements that contribute the most value is a team effort for the entire organization, and not just a few people. And the only way in which the transformation process can be sustained and continued after the first wave of automation is to develop the internal skills necessary to understand the technology behind a transformation, so that the best decisions can be made. Moreover, the development of new skills will be fundamental for employees to change their roles, and go from the, “we are people executing repetitive processes supported by technology,” to, “we have technology executing repetitive processes supported by people,” approach, as notes Deepak Subbarao, a fellow speaker with Pretty. Training of employees in a process of transformation is not a one-time task, but rather an ongoing process where organizations need to invest time and money on training and specialization in each processing cycle.
In terms of systems for recording work, Zobell describes the interior of organizations of any size and industry as a set of inefficient systems, which track work through thousands of spreadsheets, emails and ad hoc solutions in isolation. The most important consequence of this is that it is impossible to centrally report on critical initiatives. That is, no one can say exactly how the business is going in real time because there is no visibility: “The result? The financial performance of the organization for the fiscal year is a lagging indicator rather than an actively managed result. Often, a company will try to use its ERP solution as the registry operating system, since it is the only one that is remotely suitable for measurement work. But that’s like managing work efforts through a rear-view mirror.” The new emerging technologies (BPO, RPA, AI, cognitive automation) undoubtedly helped to correct these methods of working at the end of the last century, but we must remember that a process of digital transformation is, above all, a process of people. And rightly focused on people are the lessons learned that Deepak Subbarao shares with us on the road that has led towards digital transformation:
- Tell your story of change. People are skeptical, and they need a story with which to get hooked and engaged: how can we be different? How will change happen?
- Choose the correct KPIs. Yes, it is necessary to measure progress, but which are the KPIs that will help you? What else makes sense to measure how people perceive moving towards the successful transformation? A very simple indicator to evaluate investments in a digital transformation is expressed by the following formula:
- A + R < MT or OT
A = cost of automation ($)
R = cost of maintaining automation (licenses, hardware, etc.)
MT = manual effort (manual effort)
OT = overtime
That is, a reasonable investment in automation is one in which the sum of automating and maintaining that automation does NOT exceed the cost of operating manually and / or paying overtime.
- Develop and implementa structured operating model. The operating model must start from a vision that properly integrates people, processes and the correct over-seeing of said model.
- Know the value of the data. Having the right data confers enormous power and knowledge about the processes, since it allows understanding and improvement. You have to provide the correct data at the correct level.
- Communicate, communicate, communicate. Maintain a regular communication with both the inside and outside of the organization.
Conceiving a process of automation or digital transformation as the development of an ability puts the focus not only on the human quality of the task, but on a process that by its very nature should make the organization as a whole better in each cycle of the transformation. And that can only be achieved by developing proper teamwork, management and governance of an operational model of learning and communication skills. Only then can they share the same story, observe the same indicators, talk about the same project.
Author: Conciliac Team
Rob Petty, Deepak Subbarao: Transformation Trends for 2019, digital conference within the event “2019 Digital Transformation Online Summit, April 9 – 10, 2019“, organized by EnterpriseMobilityExchange.com.
Steven Zob ell: Why Digital Transformations Fail: Closing the $900 Billion Hole in Enterprise Strategy, published on Forbes.com