Sadly, too many of us have had the frustrating experience of working very hard on technology-driven solutions to big problems our company is experiencing – or on IT programs, products or services that could create a huge competitive advantage – only to have the bosses show little to no enthusiasm or dismiss it out-of-hand.
Indeed, the folks at the Massachusetts Institute of Technology’s Sloan School of Management now have provided reliable data showing that about two-thirds of us probably have had that experience – often multiple times – in recent years.
That new study from MIT’s Sloan Management Review, underwritten and co-authored by Capgemini Consulting, provides the clearest evidence yet that while “digital transformation” ought to be an absolute imperative for nearly all companies today, a significant majority of senior business leaders aren’t fully on board.
According to the report, just 38 percent of CEOs and other C-level executives in the United States have made digital transformation a permanent part of their leadership agenda or, at the very least, are perceived by their employees to have made digital transformation a permanent part of the plan.
Leaders Fail to Walk the Walk on IT Transformation
The Sloan study defines digital transformation as “the use of new digital technologies (social media, mobile, analytics or embedded devices) to enable major business improvements (such as enhancing customer experience, streamlining operations or creating new business models).”
It showed a high degree of consensus among senior business leaders that their businesses face a digital imperative: adopt new technologies effectively or face competitive obsolescence.
But it also found that many lower-ranking managers and workers say their corporate leaders lack urgency and fail to share a vision for how technology can change the business. In other words, the bosses talk the talk, but they don’t walk the walk.
That’s critical because, according to previous MIT research, companies that succeed tend to have leaders who share their visions for digital transformation, define a road map, create cross-organizational authority for adoption and reward employees for working toward innovation. Yet, from the survey’s results, that’s not happening; at least not enough.
A Deeper Look at the Numbers
The Sloan researchers received survey responses earlier this year from 1,559 executives, midlevel managers and frontline workers in a wide range of industries. Those responses clearly showed a divide.
Top managers say they do, in fact, believe deeply in the ability of technology to bring transformative change to their businesses. But they feel frustrated with how hard it is to get great, measurable results from new technology, especially in the kind of quarterly or annual time frames in which they typically gauge success. Meanwhile, more than six out of 10 midlevel and frontline workers say they don’t see digital transformation being pushed enough, if at all, by their senior managers.
Part of the problem is perspective. The lower the rank of the employee, the more likely they are to be dissatisfied with what they perceive to be the pace of change toward digital transformation. And they attribute that frustratingly slow pace of change to the CEO’s lack of urgency.
Not surprisingly, C-level and other higher-ups view things differently. A third of C-level executives and board members who responded to the survey said the pace of change in their companies is about right. Another 10 percent think the pace of digital transformation in their companies is either fast, or even very fast. Among CEOs, specifically, 53 percent think the pace is either just about right, fast, or very fast.
Why the Perception Gap?
Why the different perceptions of the pace of change? It’s hard to nail down. Part may be that younger workers, who tend to dominate the lower ranks of most companies, are more comfortable with and more eager to adopt new technologies than the older generation, of which most C-level executives are a part.
But beyond generational perspective there could lie other factors. For one, companies could lack the expertise within their ranks to offer the right IT consulting help.
Or, it could simply be a failure or inability of CEOs and other C-level executives to effectively communicate the digital transformation imperative. The relatively negative, frustrated survey responses received from mid- and lower-level workers reveals that too many senior executives have not spoken clearly, passionately and often enough with the troops about the imperative of digital innovation.
Nor, it seems, have they been willing to make the kind of budgetary, personnel and managerial focus changes necessary to push the entire organization toward rapid and effective digital transformation.
Such hesitancy is understandable. It’s difficult to back-burner products, services and processes that produce big chunks of the company’s current revenue to focus on new products, services or processes that may not yet be fully proven capable of generating as much or more revenue. As the Sloan study says: “Companies routinely invest in technology, and too often feel they get routine results.”
The Secret is to Transcend the ‘Routine’
Thus, investment in digital transformation should go well beyond “routine.” A company’s IT staff or managed IT services partner ought to be looking for ways to align technology with new business goals, creating network capacity for growth and harnessing Big Data for benefits ranging from customer insights to business process and supply chain efficiency.
“Technology’s promise is not simply to automate processes, but to open routes to new ways of doing business,” the Sloan report says.
If that’s not happening at your company, then it might be time to think about finding an IT consulting partner who has that expertise. In the long run, hesitancy to act could prove quite damaging to companies’ competitive standing, financial performance and survival.