| Written by Mark Buzinkay
No video selected
Select a video type in the sidebar.
It is no secret that businesses are under immense pressure to adapt and innovate: Digital transformation has become a necessity. However, the success of this transformation isn't solely dependent on the technology itself but much more on the organisational structure. But why are organisational structures so paramount to any digital transformation process?
Clear Hierarchical Pathways:
Flexibility and Adaptability:
While technology is seen as the driving force behind digital transformation (learn more about digital transformation tools here) , the role of organisational structures must not be understated: they provide the framework within which technology can be effectively integrated.
At the dawn of each fiscal year, it's not uncommon for companies to delve into reorganisation, reshuffling roles and responsibilities. Some might even restructure in response to financial challenges. However, these shifts, while necessary, are often reactive and don't pave the way for a holistic digital transformation. In stark contrast, strategic transformation is the linchpin to instil an innovative mindset and weaving it seamlessly into the company's fabric.
The true measure of strategic transformation is gauged by an organisation's ability to:
The initiative must be spearheaded from the top for a large enterprise to truly embrace digital transformation. While bottom-up endeavours have their merits, they often culminate in transformation at just the departmental level. But there are also other voices who emphasise the bedrock of trust within teams and the necessity of arming them with agile and Scrum tools.
It's undeniable that executive buy-in is pivotal for a successful transformation. However, the heart and soul of the transformation lie in the hands of frontline employees, and if the development and operations teams remain oblivious to the essence and advantages of digital transformation, the initiative risks faltering. But, when senior leaders recognise and amplify grassroots transformation efforts, they can serve as a beacon, guiding broader organisational change.
A synergistic approach to digital transformation also holds promise, and merging top-down leadership's strategic vision with bottom-up initiatives' hands-on insights can create a dynamic force. Together, they can collaboratively pinpoint opportunities and steer the transformational ship toward digital transformation in a different, positive way.
Yet, the journey of digital transformation can sometimes scare middle management. Visionary leaders push their digital transformation agenda and sidestep the traditional hierarchical channels, emphasising direct, organisation-wide communication and nudging staff towards novel behaviours.
These evolved behaviours often transition managers from directive roles to more of mentors, fostering employee growth and autonomy. Such a shift can lead to introspection among managers, with some grappling with their evolving roles. In extreme cases, they might even resist the transformation. For digital transformation leaders, this is the worst outcome of such an initiative, and that's why they have to ensure that every part of the organisation, especially the middle management, is aligned, understanding their pivotal role and invaluable contribution to the transformational journey.
In a revealing 2017 survey by the MIT Sloan School of Business, a staggering 80% of respondents indicated that their organisations propelled digital transformation by nurturing a robust digital business culture. Such a culture champions collaboration, agility, risk-taking, and perpetual learning.
For a seamless industrial digital transformation, it's paramount for a company to sculpt a clear vision and strategically invest in realising it. This vision, coupled with the strategy, should lucidly depict the post-transformation landscape and convey it to its workforce and stakeholders. As the transformation journey commences, harnessing digital talent becomes pivotal. A study by Capgemini revealed that a whopping 77% of businesses view the dearth of digital skills as a primary obstacle in their digital transformation trajectory. Historically, HR departments haven't been at the forefront of fostering digital competencies, often resulting in a misalignment between training initiatives and digital strategy. The subsequent illustration delineates the roadmap to cultivate and amplify digital talent within an entity:
Digital talent encompasses a spectrum of skills, both technical and leadership, essential for crafting and sustaining a digital transformation blueprint. The essence of digital transformation lies in its ability to metamorphose processes and mindsets. Apt digital talent can catalyse these shifts, bridging organisational chasms. The distinction between digital technical prowess and leadership acumen is increasingly becoming blurred, giving rise to what's often termed as 'hybrid digital skills'. This includes tech aficionados evolving into business connoisseurs and vice versa.
It's a misnomer to equate digital talent solely with coding expertise. It's as much about business acumen and soft skills. Is there a formal educational pathway to master digital transformation akin to data science? Numerous global industrial giants have embarked on pilgrimages to Silicon Valley, seeking inspiration from its digital culture and talent pool. A recurring query during such sojourns is the recipe for nurturing and retaining digital talent.
Innovative avenues like crowd-sourcing and hackathons have emerged as potent tools for talent development. Hackathons, with their gamified approach, foster collaboration between IT, business personnel, and academia, becoming crucibles for groundbreaking ideas. Such endeavours can be instrumental in attracting and retaining digital talent, transcending mere monetary incentives.
The yardstick and evaluation framework for digital talent are in flux. Corporate behemoths have pioneered cross-sectoral endeavours like the IoT Talent Consortium, with the mission "Enabling Business Transformation", aiming to sculpt the forthcoming wave of digital talent. "Leading Digital" cites Kurt De Ruwe's strategies during his tenure as CIO at Bayer MaterialScience. De Ruwe championed digital talent engagement through micro-blogging, fostering open information dissemination. He was of the conviction that once digital talent discovers its authentic voice and platform, transformational magic ensues, catalysing organisational cultural shifts.
Maintaining the vigour of industrial digital transformation is a formidable challenge. Concerns often revolve around preserving the initial zeal and momentum. The agility to expedite the transformation and incessantly scout for fresh digital avenues is paramount. Absent this, there's a looming risk of organisations reverting to their conventional modus operandi, ensconced in their comfort cocoons.
Why is organisational structure crucial for successful digital transformation?
Organisational structure lays the foundation for how a business operates, communicates, and makes decisions. For digital transformation to succeed, there needs to be clear communication channels, defined roles and responsibilities, and a cohesive vision. A well-defined organisational structure ensures that digital initiatives are integrated seamlessly, resources are allocated efficiently, and there's a unified approach to achieving digital goals. Without a solid structure, digital transformation efforts can become fragmented, leading to inefficiencies and missed opportunities.
How can organisations ensure that their employees are aligned with digital transformation initiatives?
Employee alignment is crucial for the success of any digital transformation effort. Organisations can achieve this by:
What role does leadership play in the digital transformation process from an organisational standpoint?
Leadership is the linchpin of successful digital transformation. From an organisational standpoint, leaders are responsible for:
Leadership's commitment and proactive involvement set the tone for the entire organisation, ensuring that digital transformation efforts are strategic, cohesive, and effective.
As we conclude our exploration of digital transformation from an organisational perspective, let's distil the core insights:
Dive deeper into one of our core topics: Digital Transformation