The Impact of Culture on Digital Transformation

Productive Thinking

The Impact of Culture on Digital Transformation

I worked at a large independent software vendor as a head of engineering for over a decade and through a period of incredible change, as the organisation shifted from a successful desktop based software company to a successful online based software company. The digital transformation that independent software vendor undertook impacted all parts of the business, from product development through to finance. 

If your organisation is on the journey of digital transformation, don’t underestimate the cultural changes that must accompany this.Organisational culture is a set of shared assumptions, values and beliefs which governs the way people behave in the organisation. 

Clearly to effect change in organisational culture takes time; often years. To start the cultural change process, you need to understand where you currently are and where you would want to be in the future with regards your digital capabilities and the culture that supports that.

From my experience at this independent software vendor and purely from a cultural view point here is my top tips on the key focus areas. 

  1. Have a Vision – does your organisation have a clearly articulated vision that is supported by your digital transformation?  Every part of your organisation must understand the vision and the leaders’ role is to connect team members’ work to that vision on a regular basis.  Too often leaders/managers do not feel comfortable talking about “Vision”.  That needs to change so that the vision becomes part of the normal conversation – weaving the digital transformation elements into the vision then becomes easy.
  2. Review your Values – most companies have values, but ask the hard question “are they still relevant given the transformation we need to make”.  Remember to challenge everything and focus on Core values (not permission to play values).  At this independent software vendor, “decisive – make the call” was a value that was relevant for around 6 years from 2009.  Once this value had been clearly embedded in the organisation, it was swapped for a new more relevant value “collaborate – we are better together”. 
  3. Make the customer first – a complete focus on the customer experience is critical to remaining relevant today.  Build an understanding of how customers view your organisation in all aspects and ensure that this is supported by data – in short create a customer centric mind-set.  At this independent software vendor, the Net Promoter Score model was introduced as a means of focusing the organisation on whether the customers really liked the products enough to promote the brand.  The results were sometimes shocking, but constant focus on this data and understanding the drivers of dissatisfaction turned team mind-sets around to solve the real customer problems and ultimately led to improving customer sentiment.
  4. Measure everything – your organisation must change to a measurement based culture.  When decisions are made, question “what data enables that decision?”.  Any data captured should be highly visible to all as this will generate unexpected insights for others.  With measurements, focus on trends over time more than absolute figures.
  5. Innovate – build an innovation culture in all areas of your organisation.  This should be supported by a continuous improvement mind-set, where teams always ask, “how can we improve this?” and, “what could we do differently?”.  Be prepared to take risks, and fail, but limit the impact of failure by constant review and course correction using data based decisions as your guide.
  6. Automate everything – your organisation must have an automation culture and by this I mean a bias towards eliminating all manual tasks (that make sense) and reducing wastage. In a software product world.  This is essential to enabling shorter release cycles.
  7. Be agile – devolve decision making to aid agility.  Regularly adapt products and services based on customer feedback.  Reduce product change cycles to reduce risk and improve responsiveness to customer needs experience.  Introduce Agile methodologies, but focus more on the mind set shifts of being agile and not the processes of doing agile.

Naturally you cannot change all these elements at once, but it does makes sense to define focus areas based on your organisational situation. The important thing is to proactively consider each of these areas.  Then, based on your priorities and need, build a “change roadmap” so that you have plan of what takes priority now and where to focus next. Changing culture takes time, but to fast track culture change to support your digital transformation, you need to focus and to plan.

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