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The person in charge of digital transformation at a company might be the chief information officer, the chief digital officer, or someone in another role.
Regardless of title, that person is ultimately the “transformer in chief,” according to George Corbin, the chief operating officer at the travel marketplace Onriva.
This role is difficult on several fronts. “You’re trying to create and lead a movement across an organization. You’re the ship’s helmsman and the ship’s engineer — you’re on the bridge setting direction and navigating the storm, and at the same time you’re down in the engine room actually making things work,” Corbin said during a panel discussion about digital leadership at the recent MIT Sloan CIO Symposium.
Transformation boils down to three key elements, he said. Most leaders know they need to focus on data and technology architecture. It’s also important to consider business model architecture, such as product development and go-to-market strategy, and human architecture (such as organizational charts and incentive structures).
As digital transformation touches more parts of the business, digital leaders regardless of title need to be prepared to take a more prominent role, said Marina Bellini, who has served in CIO positions for Anheuser-Busch InBev, PepsiCo, and BAT.
“Maybe 15 years ago, we were talking to the CEO about helping on cost savings. Now, we’re talking about revenue growth, new products, and the culture of the organization,” she said.
Leaders outlined five areas of focus for today’s executives tasked with digital transformation:
Clarity
Clarity is the most important element of any innovation, Corbin said. He cited the example of Peter Blake, the leader of the New Zealand sailing team that beat the United States in back-to-back America’s Cup competitions in the 1990s. Blake focused every strategic decision — from crew training to equipment design — on a single question: Will it make the boat go faster?
For modern companies seeking clarity about their digital transformation, there are four questions to ask: What is the problem? What is the solution? What is the targeted outcome? Who is accountable?
“So often, there’s a discrepancy between what the sponsor thought they wanted, what the requirements actually specified, what ended up getting prototyped, what ended up getting built, and finally, what launched,” and fingers are pointed along the way, Corbin said. “It comes back to the fact that there was insufficient clarity up front on what it was we were really trying to solve for.”
Agility
The sprint isn’t just for engineering teams anymore. Marketing, sales, and other business units should be prepared to evaluate their work on a two-week cadence and course correct as needed. Speed is an obvious benefit, but it’s what makes the speed possible — the coordination of schedules and deadlines — that transforms the business.
“The technology teams and the business teams are working hand in hand,” said James McGlennon, chief information officer at Liberty Mutual Insurance. “That has eliminated the handoffs, and it has allowed us to focus on what technology can do to get us there quickly and change the experience for our customers.”
Risk management
Fear is the death of any innovation. While this fear comes in many forms, it often boils down to the expectation that if other business units are generating $1 billion a year, then the innovation initiative should be generating $1 billion a year, too.
“It’s important to match the investment in new technology with the expectations about when they will be mature and when they can give you some payback,” McGlennon said. “If it’s going to be a little bit of value, then we can build on that. If it’s not ready yet, then we can revisit it in six months or another year.”
Managing innovation and the risk that comes with it is a stark departure from traditional enterprise IT project management, where a handful of large-scale initiatives took up the bulk of the budget. Rather, digital leadership is a matter of incubating and nurturing many efforts in an environment where it’s OK to fail.
“You need to make sure people don’t feel like they’re going to be penalized if something goes wrong,” McGlennon said. “You need to do that by setting the values and the vision — and then getting out of the way. You can’t monitor and support every idea. You have to create that culture where people have the latitude to try something out.”
Ownership
Organizations need to move away from the idea that business functions own their data sets, Bellini said. Different business units own the responsibility for managing the process, but “the beauty and the value of data come in really breaking the silos and going cross-functional,” she said.
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Likewise, firms need to recognize that focusing on who owns an initiative will likely stymie efforts to bring it over the finish line. “I’m still amazed, after all these years, how people let individual emotions play into things — ‘It was his idea and not my idea, it was that market and not this market,’” she said. “Emotions can just make things go wrong. You need to push them to the side and focus on the outcome.”
Loss management
For all the benefits of digital transformation, organizations need to recognize that someone will lose. Automating a complex manual process will streamline operations, improve efficiency, and generate savings, but it will also threaten the job security of whomever owned that process for the last decade.
Digital leaders need to be aware of these changes and proactively manage the effect on employees, whether through retraining for an existing role or assistance transitioning to a new role. “There’s a soft side of the equation that you absolutely have to tackle,” Corbin said. “Because otherwise that can undermine the most brilliant of technology initiatives with the greatest of intentions.”
Read next: how to nurture a digital workforce
