Paradox of digital transformation

Our Marina reviewed the paradoxes of digital transformation in the Poslovni dnevnik column. Read all the challenges brought by digitalization.



Poslovni dnevnik 21032018


The issue of digital transformation has for some time been the main theme of the executive and management boards of many global companies. From related lectures, discussions and polemics, one can conclude that the whole problem with the implementation of digital transformation consists of the imbalance between the conditions that need to be created in order for transformation to take place and circumstances in which this process of change occurs.


Based on seven fundaments  of digital transformation according to Daniel Newman, main analyst of Futurum Research, my arguments for that thesis are:


1. When you ask people who wants change, everyone is in favour because change sounds like something new and exciting. However, when you ask the same question on personal level, asking “who wants to change” you will get completely different answer. Explanation for this lies in basic psychology – it is hard for people to exit their comfort zone, especially when they feel secure and safe in current situation. One bank recently shared an information that a hundred of their 120 employees in one of the key departments quit within six months after launch of change process. It is a nightmare for human resources, I would dare to say.


2. Change as a process requires a certain amount of time. On the other hand, the speed at which technology changes doesn't allow time, but creates pressure for quick and rapid change. According to Forbes magazine, technological changes pose a greater threat to global business than political or environmental changes.


3. Time in context of leadership. According to a McKinsey research, successful leaders have three charactristics: support, efficiency (in problem solving) and capability of analytical approach. Fast changes require quick decisions and time for in-depth analysis is simply too short against pressure on speed of decision-making process.


4. Corporate culture is created for years, and digital transformation cannot happen without its dramatic change. Innovations mean investments and the ability to make mistakes, and shareholders are not happy when they lose money. One of the few CEOs who managed to persuade their shareholders to be patient is Satya Nadella (Microsoft).


5. In the run for constant technological innovations, the value of user experience from time to time seems to fall from the list of priorities. This is another paradox, because one of the main ideas for developing new technologies is the improvement of user experience. Companies that win hearts of consumers today are those companies which put focus on their consumer and the unique experience that new service or new product can provide. This is the key point of differentiation from competition and the added value upon which nearly all industries depend. Someone recently said "No technology in the world will help you unless you show empathy toward others." I hope this will soon become mantra of market competition.