Six Stages of Digital Transformation
Driving digital maturity across the most critical levers can create a disproportionately positive impact.
How to Jumpstart your Journey to Digital Transformation
Most companies know they must adapt and evolve to compete in a digital economy. Yet the very mention of the term “digital transformation” creates angst and apprehension among the most seasoned managers and business leaders. There is a good reason for their angst.
Technology has enabled consumers to become more mobile, social and continually connected than ever before. This in turn has transformed how they interact and connect with each other and with products, services and businesses. Digital transformation is creating spectacular new opportunities for innovation. Digital transformation is creating spectacular new opportunities for innovation. But it is also accelerating ‘Digital Darwinism’ – the disruption of businesses and entire industries as they fail to adapt to new customer and competitive environments.
“Technology has enabled consumers to become more mobile, social and continually connected than ever before.”
There’s no doubt that the notion of digital transformation can be daunting – but it doesn’t have to be. By systematically understanding gaps across critical levers for competing in a digital economy, managers can begin to understand how to identify, prioritize and appropriately resource digital transformation initiatives.
If your company is ready to embark on a digital transformation journey, the first step is to understand what levers are most critical to your business and where it stands across each today.
What levers are most critical for your business?
Prophet has identified eight interrelated levers that underpin successful digital leaders and their digital transformation maturity. These include:
- Customer Experience
- Product and Service Innovation
- Channel and Path to Market
- Social and Content
- Insight, Data and Analytics
- Policies, Guidelines and Governance
- People, Training and Organization
Depending on your company’s market and industry dynamics some levers may be more critical than others. Prioritizing and driving digital maturity across the most critical levers can create a disproportionately positive impact on the overall transformation of a business.
What is the current state of digital maturity across the business?
In order to drive maturity across key levers, you will need to understand where your organization stands across these today. Prophet has developed a sophisticated digital transformation maturity model that identifies six distinct stages of digital maturity. These stages are informed by research from Brian Solis, Principal Analyst at Altimeter, a Prophet company, and benchmarks from studying dozens of businesses that are undergoing digital transformation.
The six stages are as follows:
Stage 1: Business as usual – It is not that you haven’t begun to focus on digital efforts, but the majority of your investing is in platforms and becoming tech-enabled. Digital is regarded as just another line item. And perhaps most significantly, leadership tends to rebuff new ideas.
Stage 2: Motivated – You are aware of growing disruption and have made the shift into the test-and-learn phase. However, you still tend to operate in silos and continue to make investment decisions using classical metrics. Changes aren’t typically well organized, but they create enough internal buzz to nudge executives out of their respective comfort zones.
Stage 3: Programmatic – You have begun to transition into a more cogent “systemize and strategize” phase. The pilgrimage toward transformation has begun to trigger strategic investments in people, processes, and technology. Executives throughout the company become more educated and involved, which lends more structure and thoughtful oversight.
Stage 4: Determined – At this stage, your company may have fully accepted the drive toward transformation. Efforts are planned with clearer intentions, and you are better able to clarify both short and long-term goals, supported by investments in infrastructure.
Stage 5: Transforming – By now, digital transformation has become part of your company’s DNA, and the company is continually developing disruptive ideas, working toward initiatives that create value. Leadership grows into the agenda of transformation, and you develop new working models.
Stage 6: Innovative – In the final maturity phase, your organization has fully absorbed the culture of innovation, and transformation begins to accelerate. With processes, investment and metrics in close alignment, companies gallop toward new opportunities for growth. And while you haven’t achieved true digital transformation—given the pace of change, that just isn’t possible—you are fully launched on the quest, with transformation a top priority.
How can you jumpstart your digital transformation journey?
Once you identify the most critical levers, and where you stand on the digital transformation maturity, the next step is to determine where you need to be and how you can get there.
Prophet takes a unique approach to answering these questions. By leveraging a multi-disciplinary team of design thinkers, strategists, digital specialists, and company stakeholders, Prophet helps define a future state vision for a company’s digital transformation. Subsequently, it defines a clear roadmap outlining priorities, timing, owners and metrics to capitalize on opportunities and close critical gaps across levers.
As digital disruption continues to accelerate across industries, the task of transforming an organization to protect and grow its business may seem daunting. But as long as you’re moving forward, bringing people together, and making progress, your organization should be on its way to competing for the future rather than falling to Digital Darwinism.
6 Stages of Digital Transformation Report
Download “The Six Stages of Digital Transformation: The Race Against Digital Darwinism,” a new report by Brian Solis, principal analyst at Altimeter, a Prophet company. This report offers the first maturity model for digital transformation – and a definitive, step-by-step guide to becoming more agile, competitive and innovative in a digital economy.