Digital transformation — using technology in innovative ways that transform or automate the traditions and processes of the past — should be on every company’s radar.
Technology can be used to both enhance manual processes and augment the tools that already exist. So by thoughtfully implementing technology solutions within your company, you’ll achieve operational efficiencies, enhance your competitive edge, and even take advantage of a new market.
Consider the digital kiosks that are becoming increasingly common in fast-food restaurants. These machines have their fair share of perks: Customers gain more control by securing their orders faster and avoiding frustrating lines, and employees spend more time away from registers on other pressing tasks.
Despite the lure of productivity and lowered costs, though, companies that implement these digital solutions should understand the impact for doing so beyond cutting labor costs. It’s also crucial for them to understand and effectively communicate the nuances of these digital transformations to both customers and employees.
Perception gaps during digital transformation
One of the greatest hurdles facing organizations on the verge of a digital transformation is the perception gap between executives and their employees — the perception of digital transformation’s impact.
Executives have a forward-facing view; they often see technical advancements as necessary to staying ahead of competitors. The employees, on the other hand, are focused on their individual productivity and day-to-day tasks. To them, tech innovation could spell cutbacks and layoffs instead of long-term success, and the resulting rifts create a lack of trust and understanding.
A specific example of the misunderstanding between leaders and their employees is clear when leaders are asked about digital transformation: 55 percent of the respondents to a survey on digital readiness said they lacked the internal skills to transform. Rather than leaders looking at the opportunity for growth and adaptability of their employees, executives see the employees as a deterrent. In this example, you can see how the disconnect starts with leadership’s perceptions.
In taking a closer look, however, we see that business leaders and employees have the same goals regarding digital transformation: Both parties need to continuously refine their processes and skills to survive, which calls for a symbiotic relationship. When employees don’t see this high-level vision, though, executives are left wondering why their staff resists impending changes. Even worse, executives often don’t adapt their messages fast enough once they realize their communication isn’t working.
That’s why a hard-line approach to communicating technological change is futile at best and sabotaging at worst. Employees could start seeing digital transformation as the reason they’ll lose their jobs instead of a positive for their trajectory within the company.
This kind of transformation doesn’t just have the potential to cause internal misalignment, though. Customers should also understand the reasons behind the digital shifts that affect the way they interact with your company. Effective digital transformation can surely drive satisfaction (which leads to competitive displacement or new market penetration), but it’s wise to make customers aware of why certain digital changes are happening — and how this will impact them — before they suddenly find their user experience upended.
Fortunately, there are a few ways to navigate this misalignment and help employees and customers keep up with digital transformation’s benefits. In the end, they should see these technical changes as wins for everyone instead of a grave misalignment of purpose:
1. Align with what differentiates your service.
At a cafe where customers value human interaction from baristas — and actively seek that interaction out by visiting each day for their favorite caffeinated drink — a digital ordering kiosk could seem out of place.
In fact, it could cause a business to suffer as customers looking for a more organic experience start to take their dollars elsewhere. That’s because this form of process automation wouldn’t align with what differentiates the cafe itself: allowing customers a handcrafted experience with a human touch. On the other hand, visitors to a completely mechanized coffee shop — think San Francisco’s Cafe X — expect a fully digitized experience.
When digital transformation impacts your brand identity, you could lose market share. It’s critical for executives and teams that are mapping out their ideas for digital transformation to keep this in mind. Before diving in, consider what differentiates your service — and do a deep dive on whether digital transformation would help or hinder your brand identity.
2. Get ahead of any residual impact.
Getting ahead of a process change before diving in is also a crucial step. Placing automated order kiosks in your business, for example, could create an entirely different experience flow within the store. Kiosks might not work with your entrances, and employees who previously handled cashier duties suddenly find most of their time freed up. If companies don’t consider this ahead of time, they could run into potentially costly frontline problems.
It’s also easy for some internal day-to-day processes to go unnoticed for executives facing operational efficiency pressures. Leaders who want to automate the process of using Microsoft Excel, for instance, might not be privy to Excel’s role in interdepartmental relationships and dependencies.
They don’t realize that the data the finance department enters is part of a close collaboration with human resources and that key insights are lost without that human collaboration. Because of this, executives must understand why employees aren’t always ecstatic about automating a process. In many cases, these processes actually facilitate new insights and healthy working relationships instead of bogging down operations.
Internally, consider using a systems-thinking approach to uncover the relationships and dependencies within an organizational system. Have stakeholders consult employees who would be affected by a digital change, and broaden the view to multiple departments to get a wide variety of perspectives and an expanded systems-based view.
If you’re looking to enhance processes, examine the entire value chain of a digital transformation idea. Provide executives with a holistic view and include the predicted organizational impact.
3. Actively facilitate customer and employee communication.
Within companies, it’s up to mid-level groups to open communication channels that enhance connections between the people making decisions and the employees who are directly affected by the changes. In fact, organizations that emphasize effective communication experience greater employee engagement and less turnover than those lacking transparent communication.
Therefore, the purpose of the digital transformation should be clearly communicated in several ways, at a few different times, and through a variety of mediums. Scheduling coffee meetups with executives (along with video meetups for remote employees), opening a forum for questions, and publishing a weekly internal newsletter are just a few strategies that ensure everyone sees eye to eye. Helping your employees see themselves in the company’s future is vital to their engagement.
By outlining training investments and growth paths for your employees, you build their trust. Your goal is to maintain a consistently transparent relationship, as communicating openly is one of the crucial factors in gaining employees’ trust. This sounds self-explanatory, and that’s because it is: Executives should ensure that they’re actively solidifying trustworthy relationships and providing transparent communication pathways for employees.
In the same vein, customers should have a clear understanding of digital transformation and its impact on them. Marketing the change in advance helps retain your brand identity. Your customers should be able to easily get answers to their digital transformation questions, whether they’re asking an employee on the front lines of your business or a customer service representative online. After all, change — even if it’s meant to be extremely convenient — can be difficult.
Your company’s communication solutions could involve anything from creating customer-facing social media groups for announcements about in-store shifts to highly strategic advertising campaigns. Your biggest priority here is to maintain an effective change-management process that strengthens the bond between executives and employees and ensures integrated communication with customers.
4. Focus on employee empowerment.
Your employees shouldn’t be forced to keep up with digital transformation because they have to. Instead, they should feel secure in their roles and inspired to adapt to their organization’s ambitious goals for the future.
Presenting your digital transformation as a value-driven opportunity for your employees and customers is key. Encouraging your employees to envision their future roles and accountabilities based on their passions and skills empowers them. Your employees are your best asset and can accelerate the value of the digital transformation when they co-own that change.
As you move forward, make sure you address all employees and describe their new future, regardless of their position on the organizational chart. This helps them visualize themselves in the transformed environment, which empowers them. They realize why the shift is as much for them as it is for the company — and ensures expectations are still aligned when employees experience digital transformation in full.
The impact of digital transformation on employees is nothing to take lightly. Whether you’re mapping out plans for order kiosks or automating a manual process, failing to understand the impact and communicate the changes properly could result in a domino effect of negative consequences for all. If, however, you use all your assets to your advantage, individuals from all levels of the company and value chain will not only accept the digital transformation — they’ll embrace it.
By following these tips, your company can achieve the expected value from your digital transformation and achieve operational efficiencies, enhance your competitive edge, or take advantage of a new market.
DISCLAIMER: This article expresses my own ideas and opinions. Any information I have shared are from sources that I believe to be reliable and accurate. I did not receive any financial compensation for writing this post, nor do I own any shares in any company I’ve mentioned. I encourage any reader to do their own diligent research first before making any investment decisions.
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