Why Businesses must Fail Fast to Succeed at Digital Transformation
The digital transformation journey is by no means easy. In fact, according to McKinsey, the success rate of any kind of transformation is consistently low with less than 30% succeeding.
Even among digitally savvy industries, such as telecoms and media, the success rate of digital transformation doesn’t exceed 26%. So, with such low levels of success, how can business leaders adjust their approach to digital transformation?
The key to success
For a successful digital transformation journey, businesses must be agile so as to rapidly evolve their processes, organisation, the way they engage with customers and react to shifts in the market. To achieve this level of agility, business leaders and their organisations must implement a fail fast approach.
Businesses must not be afraid to fail as it will enable them to learn, improve and eventually get things right, but they must fail quickly and learn the lessons of the failure even faster. In order to adopt a fail fast approach to digital transformation, business leaders need to ensure they arm their employees with the right tools and cultivate a culture that encourages employees to experiment and learn from mistakes.
Data management tools
Key to failing fast will be using the right tools. One of the most important tools a business can have to help them on their digital transformation journeys are data management platforms like InterSystems IRIS. In 2019, if leaders are not basing their business decisions on data, they are going to be left behind.
From finance to marketing, sales forecasting, even hiring, organisations today rely on clean, accurate and comprehensive data from inside and outside the organisation to run their businesses. Data management solutions act as the intelligent core to power a range of transformation initiatives, which is one of a few tactics integral to the process of failing fast.
Often, these solutions provide the capabilities to speed up and simplify digital transformation initiatives and can be integral to the process of failing fast. For example, visualising data flows and the interactions between processes, components and people in real time allows for rapid and accurate diagnosis and monitoring of the status of real-time and historical data, integrations, and processes. This means organisations can see the impact of any changes immediately and act accordingly so as to speed up the process and pinpoint any errors in real-time.
Data management tools will also be integral to setting out new metrics and measurements as business leaders set expectations about how many failures are acceptable and how they can measure the success of changes. This will make it easy to spot when developments have failed and ensure they are rolled back as quickly as possible, ready for a new version to be tried. We regularly see this with apps and websites such as Amazon which roll out tweaks to the user interface to certain customers and use A-B testing to determine which changes are successful and which haven’t worked.
What counts as a success?
Business leaders must also work to understand their appetite for failure and determine the risks they are willing to take. After all, big risks are likely to mean the organisation will either win big or fail big. With new metrics in place, business leaders will be able to better communicate with their employees the amount of failures they are expecting to see, for example, they may set this at 20%. Equally, they must also determine what ‘good’ looks like in different contexts in order for employees to be able to accurately measure the success of their work and make changes accordingly.
A fail fast approach will enable businesses to rapidly create, launch and implement the innovation needed for digital transformation. Business leaders should ensure that all change is incremental – pushing out small changes frequently and measuring their effectiveness. If something doesn’t work, they must back out quickly, develop measures for how revolutionary to make the next set of changes and gain a common understanding throughout the business of what ‘good’ looks like. This will ensure that they are not wasting resources and going down dead-ends.
Read more from Jon Payne here on the topic of failing fast with CEO Today.
