Given all the moving parts, it is easy to see how leaders can become digitally detached. Transformation can be overwhelming, especially for those in lagging industries, leading to denial, immobilization, and frustration (the classic change curve). Unfortunately, in this speed-as-a-competitive-advantage era, procrastination is a fast route to short-termism, knee-jerk reactivity, and failure.

Thus, the question boards and C-suite executives must answer is not “What can digital transformation do for our organization?” but “What is our strategy to meet and exceed customers’ needs and expectations in a digital world, and how do we execute it successfully?”

Digital transformation involves much more than just technology, and this is where many companies and leaders are going wrong. Digital transformation is a cultural change, a way of working that requires organizations to continually challenge the status quo, experiment, and get comfortable with setbacks — learn, adapt, and go again.

Antony Edwards, COO of software testing and monitoring company Eggplant, gets to the heart of it:

Too many people treat digital transformation as something around infrastructure and IT. It’s not; it’s about the company culture, it’s about DNA, and it’s about business models. And if you don’t approach it from that kind of business and customer perspective, it’s going to fail.⁵

Businesses that don’t look holistically at the business model transformation at hand can end up investing in the wrong technology and/or doubling down in the wrong areas. This results in the rest of the organization being pressured to recoup costs. When employees are starved of the resources required to service customers effectively, they become frustrated and question the capability of their leadership. In a world where employee choice is more powerful than ever, this is a dangerous moment for boards and leaders still trying to figure things out.

Today’s leaders face a broader set of transformational challenges than during previous industrial revolutions. Industry 4.0 has three core shifts: digital, workforce, and “leadershift” itself. Leadershift refers to new capabilities that boards and executives must cultivate, adopt, and practice in a digital world. In many ways, leaders have the steepest learning curve of all and can easily become overwhelmed and immobilized by the sheer breadth of the tasks at hand.

Accelerating Progress

We know something is not working. It’s a combination of leadership mindset, implementation orientation, and culture building at the same rate as business model transformation. It’s a people play as much as it is executing on technology and technology ecosystems that enable great customer and employee experiences.

In addition, organizations with poor data and data analytics, legacy technology architecture, and increasing tech debt are increasingly immobilized, as they simply don’t know where to turn and what to tackle first. Building out a short- to medium-term roadmap to bring everything together is the first important step in helping to visualize the scope, scale, and journey required for leaders, boards, and the rest of the organization.

And then, with the question having shifted from “what we need to do” to “how to execute successfully,” leaders and their teams need a way to start. We suggest a compelling digital ambition. For many lagging companies, especially those in lagging industries, a digital ambition is the key to a clear path forward and requires five crucial steps:

1. Identify your digital ambition. Understand what digital transformation means to your customers and articulate your transformation strategy in a way that helps customers buy into it. This will make it easier to bring employees on board.

2. Work from the inside out. Create the purpose that drives the transformation. Many organizations enter digital transformation with plans for productivity improvements, cost savings, and the like. This is an inside-out view that considers the impact on the customer second. An outside-in view is required if your digital transformation aims to provide the best customer journeys and experiences. Of course, when the voice of the customer is loud and clear, internal benefits will follow.

3. Cultivate a transformation culture. Ensure the culture is evolving at the same speed that your organization is transforming. This ensures alignment between the board/senior executives with leaders across the business, resulting in stronger engagement and mobilization of the entire organization in the implementation journey.

4. Leverage a data operating model. A solid data-operating model is critical for fast, considered decision-making across the organization. (Better data = better decisions = better performance.) For many organizations and leaders, this is a bigger job than expected: there is a need to review, qualify, and clean legacy data and understand which data will be of greatest value to customers and the business going forward (keeping the digital ambition in mind). Done well, it leads to better decision-making and speed of execution and links directly to performance and future growth (e.g., the ability to monetize data as a consulting-led revenue stream).

5. Move from awareness to action. Align the whole organization behind taking the right actions and clearly articulate the why, what, how, when, and what next. Use language that everyone (customers and employees) can get behind to engage and mobilize the entire company, not just the leadership team or a few project leads tasked with taking things forward.

These steps ensure everyone at the board and executive levels is on the same page, aligned behind a digital purpose and able to drive the right digital expenditures, investments, and implementation steps — with the rest of the organization engaged and mobilized for the journey.

Over the next five years, boards, leaders, and organizations struggling with transforming for a digital world must get fully in the game, moving from digital detachment to digital determination with a clear, forward-looking plan and commitment from all levels, to ensure their long-term viability and success.

[For more on digital transformation leadership, see: “The Journey from Digitally Detached to Digitally Determined.”]