After years of talking about digital transformation, has the time come to ditch the idea? Greig Johnston argues that it is digital evolution that businesses and HR should be focusing on.
For many years now, people have been talking about digital transformation. This buzzword was originally created to describe the adoption of digital technology to disrupt the marketplace through the digitisation of non-digital products.
But in the post-pandemic world of work, digital transformation has quickly become a thing of the past. Indeed, any business that hasn’t gone through some sort of digital transformation over the past three years is either uniquely niche or – more likely – no longer in business.
Almost every business will have some kind of online presence – whether that’s a website, mobile app or social media platform. Because of this, I believe the term “digital transformation” is no longer relevant – we should no longer talk about it. Instead, we should talk about “digital evolution” and adopt a mindset that reflects this.
Digital evolution
Digital evolution is the continual adoption and refinement of new and emerging technologies to improve business efficiency, reduce costs, overtake competitors and achieve better outcomes.
With the current rate of change – where new technologies and services are developed and released at lightning speed, providing better information, increasing automation and pushing boundaries further – I would argue that if you’re not evolving, you’re risking business success.
From digital transformation to digital evolution
According to Harvard Business Review, of the annual $1.3 trillion spent on digital transformation before the pandemic, an estimated $900 billion was wasted. Then the pandemic hit and, in full crisis mode, companies everywhere ramped up their spending to revolutionise their digital offering, boost their online presence and survive. Without robust long-term strategies, however, many of these companies are now stuck.
A good example is a retail company that has invested in its website but continues to use manual processes to fulfil orders. During the Covid crisis, many retailers were forced into e-commerce without sufficient time, resource or capacity to fully consider the end-to-end digital process.
Digital evolution would explore this process and gradually develop the right backend operations to drive efficiency and improve profitability.
It is generally more cost-effective to drive efficiency by developing a programme to evolve what you already have, rather than scrapping it and starting again. This approach is usually a far better use of employee time and capacity, with the added benefit that your people are free to focus on the next phase of innovation (as in the case above). This is especially important in a cost-of-living crisis when budget-holders are striving to “sweat the assets”.
Benefits of digital evolution
In addition, a recent report by multinational enterprise software company Sage found that 83% of HR leaders and 85% of business leaders expect HR functions will focus more on employee experience as they become more strategic and people-focused in the changing world of work.
For any digital evolution programme to be successful you must ensure that the relevant stakeholders – including your own HR team – are looped in and that your change plan is underpinned with appropriate L&D opportunities”
Underpinning this will be a requirement for HR professionals to incrementally keep pace with technology including people analytics, Cloud HR and employee self-service. This is not a one-off effort, rather a gradual and continuous process of development.
At this point, it is important to stress that for any digital evolution programme to be successful you must ensure that the relevant stakeholders – including your own HR team – are looped in and that your change plan is underpinned with appropriate learning and development opportunities, supported by a robust communications and engagement plan.
A digital evolution mindset
It is also important to understand that digital evolution requires a different financial mindset. It’s typical to have significant upfront investment for so-called ‘digital transformation’ – but the danger here is that money is spent quickly and easily because of the hunger to deliver big and fast. Invariably, these projects blow out of proportion and are among the 80% to get scrapped.
Digital evolution requires a mindset shift toward regular, sustainable, long-term investment with 70% functionality in the first few months and the remaining 30% gradually, over a period of several more months, to create longevity.
Digital transformation is at a post-pandemic inflexion point and companies must shift their corporate mindset away from this outdated concept and toward digital evolution.
Doing this will ensure businesses evolve at a steady and sustainable pace in service of their customers and with a people-centred approach that’s guaranteed to be successful.
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