3 Myths About Digital Transformation
written by Bertram Schulte, Chief Digital Officer of SAP
Many companies hope to achieve the innovation, profits and streamlined processes that digital transformation promises. However, in my experience, I often find there is ambiguity about digital transformation from our customers, partners and business colleagues. To help separate what’s fact and what’s fiction, I’ve condensed my point of view into three myths about digital transformation. If you grasp these common misconceptions, you’ll be on your way to achieving true digital transformation.
Myth # 1: Digital Transformation = Better Technology
The most common misconception is that if a company upgrades their technology, they will have successfully completed their digital transformation. However, while new technology is vital to any successful transformation, it is hollow without looking closely at the overall processes and corporate policies in place and the willingness and buy-in of an organization.
For true change to occur, a company-wide and employee-wide buy-in is critical for sustained transformation — the effect is that what is offered and/or how it is achieved has profoundly improved. A company’s executive team must provide a clear vision with concrete details of the long-term goals before cascading them down to the rest of their teams.
At the same time, every member of a team must take personal responsibility and change the mindset from the bottom up, too. Any change at this level is rather cultural than technological — technology is the enabler, but not the objective. True cultural change occurs when the entire organization buys into the new ideas and feels accountable. Management can present fresh ways of thinking, but each employee is responsible for buying in the transformative efforts.
Culture change doesn’t make the new technology irrelevant, obviously. As part of my role, I’m charged with delivering a successful “no-” and “low-touch” experience and establishing digital as the one channel for the entire customer lifecycle. The majority of SAP’s customers want digital access, which is why our highest priority for transformation is to create an even-better customer experience — one with more transparency and a streamlined purchase path. We want to enable them to discover, buy, try, manage and interact digitally with SAP. So, while technology is important, it tells an incomplete transformation story. Culture cannot be overlooked.
Myth # 2: Digital Transformation Only Matters to Technology and Software Companies
Your company doesn’t need to be a Silicon Valley behemoth or hot start-up to embrace digital transformation. Take the tourism industry, for example. In 2015, Disney announced it was investing $1B in IoT sensors for its parks, like Disney World. Radio Frequency Identification (RFID) technology bands now act as hotel room keys, ride tickets and payment. The ease-of-use pleases customers and helps the company improve customer experience.
But not every company has to invest a billion dollars to realize their transformation goals. For example, Sun Communities, a real estate investment trust headquartered in Michigan, is one of many smaller companies SAP is helping on their digital transformation journey.
Sun Communities wanted to automate processes and implement a new rewards and recognition program. The company, an avid user of SAP SuccessFactors solutions, visited SAP App Center, and in a matter of minutes, filtered down to a solution called JobPts. An hour later, Sun Communities purchased, deployed and customized JobPts. The new solution received very positive feedback from employees and increased employee engagement 150%.
Myth 3: Digital Transformation Can Wait
It is no secret that the rate of technological change is increasing exponentially. That means starting any transformation will only get harder down the road. While your company is running in neutral, a competitor may be accelerating their transformation. Digital transformation will not get easier to implement and it will not get cheaper. Companies — across all industries — don’t have time to wait.
The time to act is now for SAP, too. By 2020, we imagine an omnichannel SAP that sets the industry standard for customer-centricity and simplicity in doing business. Every day we ask our customers to reimagine their business, push the boundaries or enhance the customer experience. SAP has a rich history, but our legacy will be digital. We are the digital vanguards, redefining how SAP — and by extension our customers — do business.
Digital transformation has never been more important for our customers, partners and SAP colleagues. Now armed with three of the biggest myths of digital transformation, you can focus on what really matters. Your digital journey starts today.