Why This CEO Does Not Believe in Digital Transformation

I recently asked people on LinkedIn to explain how their companies are trying to achieve meaningful organizational change. Most said with “greater efficiency” through “digital transformation” — with technology as the way to realize those efficiency gains.

The drive to transform is an honorable one. Unfortunately, too many companies are fixated on the wrong goals. Technology is a means to change an experience — implementing new technology is never the goal.

In the past, larger companies that I worked for pursued change through “innovation initiatives.” But with the promise that technology makes our lives easier and more productive, corporate imperatives have become more specific — with technology playing a leading role.

Companies are being forced to rethink how they innovate, and technology is at the core of achieving better outcomes for customers and employees alike.

That is why the most common type of organization-wide change discussed is the so-called digital transformation. Yes, I said “type.” This is because I do not believe in just one form of transformation. The scope of what it takes to enact true change for customers and a company is much broader than just introducing new technologies.

This is because analog is still just as important as digital. Human interactions matter and that has nothing to do with artificial intelligence, blockchain, or autonomously driving cars. In a world ruled by human thoughts and emotions, technology is just another tool to make our lives easier and more enjoyable. Digital is not an end game.

Our team at Aha! has been talking about these issues with our enterprise customers. These conversations form our understanding of what many companies are going through right now. And we have started defining it in new terms — described by us and inspired by the ways we are seeing our customers take on the future. We call it “enterprise transformation.”

We believe there are actually three major types of transformations to deliver meaningful impact in any large enterprise: digital, solutions, and data.

Your company may be like most others working to incorporate new technologies — this is wise. Or your team may be investing in the data needed to identify better outcomes. Or you may be coming at it from a Go-to-Market focus, looking deeply at how you serve customers more holistically with solutions.

Enterprise transformation does not require embarking on all three types simultaneously. Every company is unique in its strengths and challenges. However, all organizations that are trying to transform in a meaningful way must put experiences at the core of their goals. These companies understand that technology is just a tool to get there. Focusing on capabilities, projects, and technology alone is not enough for true innovation.

True enterprise transformation requires a different mindset today versus the innovation projects of the past, as you can see in the table below. Your investments and actions must revolve around customers rather than whatever technology makes possible. This is a fundamentally different approach to innovation for company and product builders than what took place even five years ago.

To truly delight customers over and over, you have to continuously solve the problems that people face in an elegant way. This takes work. It demands a holistic outlook. And it requires a real commitment to what I call The Complete Product Experience (CPE).

So what about those three types of enterprise transformations — digital, solutions, and data?

I will be writing more about enterprise transformation and what it requires in detail. With all three types, product managers are in the best position to understand what customers actually want. Product managers are the builders of new experiences and processes — they are leading organizational change from the front.

So let’s stop talking about all transformation as simply digital. In today’s dynamic markets, what companies really need to take on is an enterprise transformation.

How do you define digital transformation?