Building your digital transformation strategy

What is a digital transformation strategy?

A digital transformation strategy is a long-term organizational framework for improving processes and operations with the support of advanced technologies. It goes beyond the implementation of new software systems and solutions, focusing instead on how those systems and solutions will contribute to the achievement of fundamental business goals.

The importance of a good digital transformation strategy

A digital transformation strategy is important because it is the best way to ensure that your investments (of money, time and resources) are aligned with your organization’s future.

Although a digital transformation strategy isn’t a prerequisite for incorporating new capabilities into your tech stack, it’s important for helping you make smart decisions, establish your direction, stay the course and measure your success.

Without a strategy, organizations often stumble on their quest for digital transformation. First, because they tend to focus more on the technologies themselves rather than how the technologies will affect their workflows, employee experience, organizational output and customer satisfaction. Second, because they view digital transformation as a finite process with a measurable end. They think that once they have modernized their tech stacks and done away with manual processes, they will be “digitally transformed.” In reality, a digitally transformed state is impossible to achieve. As circumstances, trends and technologies change, so will opportunities for digital transformation. That’s why we encourage organizations to think in terms of digital transformation journeys or ongoing digital evolutions.

Craft your digital transformation strategy with this eight-step framework

Creating a digital transformation strategy from scratch can feel daunting, especially if you have only a passing understanding of bleeding-edge technologies and their applicability. It’s difficult enough to know what the next step should be on your digital transformation journey, let alone try to predict the moves you’ll need to make years into the future.

This is where it’s important to remember that in smart, successful digital transformations, the technology follows the mission and vision of the organization, not the other way around. When you implement transformative technologies for their ability to support the fundamentals of why your organization exists, opposed to choosing flashy, “sexy” tech to keep up with the corporate Joneses, the initiative becomes easier to follow and stick with.

1. Get back to business (goals)

Start your digital transformation strategy by looking at your overall business strategy. Where do you want your organization to be in one year, five years, ten years? And what needs to happen to ensure it gets there? Look at your fundamental business goals, like a certain amount in profit, number of new customers or percentage increase in brand awareness. Then think about what potential obstacles stand in the way of reaching them. Technologies that can help you avoid these obstacles are a great place to start your long-term transformation.

2. Get the right people involved right away

One of the biggest mistakes an organization can make when it comes to digital transformation is considering it primarily an IT initiative. This couldn’t be further from the truth. Digital transformation may start with your tech stack, but it applies far beyond. The most impactful digital transformations will transform how people internally and externally (employees, partners, vendors, customers and prospects) interact with your organization and with each other. That means it’s important to involve representatives from each of these groups from the get-go — not to try to make everyone’s wishes come true all at once but to refocus on the fundamental business goals together and align on ways that technology can help you achieve them as a team. This early buy-in will help you identify considerations from various stakeholder groups that could otherwise be overlooked and will also create change-management champions across all user groups.

3. Review your tech stack

Look at your current systems and software implementations with fresh eyes. The technologies that helped your organization grow a decade ago might be holding you back today. If your legacy implementations are beginning to feel more cumbersome than convenient, the short-term pain of moving on is almost always a better alternative than the long-term pain of holding on.

On the other hand, your current implementations may be capable of much more than you’re currently using them for. If your vendors value digital transformation themselves, their products and services are likely evolving as quickly as your use cases. Look for ways to configure, scale, embed and integrate the products and solutions you’ve already invested in to support your digital transformation strategy.

4. Assess the readiness of your culture

This step is tricky for a couple reasons. First, because cultural readiness is difficult to measure. You can look back at how your organization handled similar process and operations upheavals in the past, but only with the understanding that you’re not in the same place you were then and that past experiences (both successful and unsuccessful) may well have taught important lessons. Second, because especially at larger organizations, culture isn’t always homogeneous. Some departments and teams are more innovative and up for change, and others (often those subject to more outside rules and regulations) are more hesitant.

So we recommend assessing culture in the context of the overall health of the business. A digital transformation strategy is a necessity regardless of whether the future is uncertain and morale is low, or business is booming and employee retention is at an all-time high. But how you implement the strategy will differ. Investing in a new platform that automates manual human labor in the face of impending layoffs probably isn’t a good move. But promoting the capabilities of technologies you already own to simplify processes and support a work-from-anywhere culture in that same scenario would likely be much better received.

We also recommend looking to those departments, teams and functional areas that you identified as innovative and change-positive as a place to begin your strategic digital transformation efforts. When you can effectively improve efficiency and collaboration in these high-enthusiasm, low-risk instances, you can then scale the frameworks to higher-reward (but tougher-to-convince) areas of the business.

5. Identify any roadblocks

Did you know an estimated 70% of digital transformation projects didn’t meet desired outcomes? The good news is, you don’t have to be part of that statistic. Prevention stems from preparedness.

Whether you’re concerned about the cost of achieving your ideal digital transformation, the time and effort it will take to migrate all your content and information from legacy systems into new ones, or the hoops you may have to jump through to stay compliant while working on cloud-based platforms, you can keep a few things in mind:

First, every organization faces challenges, and there will never be a “perfect” time to take the next big step. Every company that has successfully digitally transformed began right where you are now. But research shows organizations that invest in modern technologies like content services before it becomes a necessity are more resilient and more capable of digital transformation than those that don’t. What matters most is anticipating potential roadblocks and understanding ways around them preemptively, as you develop your strategy.

Next, the roadblocks you identify will likely affect your go-forward plans regardless of whether you commit to digital transformation. Further, and somewhat counterintuitively, investing in digital transformation is often the best way to tackle these roadblocks. Once you get past the hurdles of cost, effort and compliance, you’ll see how these future-looking technologies will save you money, energy and the risk of catastrophic error.

Finally, you don’t have to tackle this initiative alone. Again, your organization is far from the first to contemplate investment in technologies and processes outside your comfort zone. With the right digital transformation partner, you can reach your full potential and achieve smarter, stronger, faster growth.

6. Align your objectives and targets

Here’s something people can have a tough time wrapping their minds around when it comes to digital transformation: Digital transformation itself isn’t a goal you can achieve — you’re never going to be deemed “digitally transformed.” It’s a process of constant evolution and evaluation. That doesn’t mean, however, that the entire digital transformation journey is immeasurable. The goals you’re looking to meet with the support of digital transformation should still be SMART (specific, measurable, achievable, relevant and time-bound).

Part of getting cross-departmental stakeholders involved from the start is understanding what they want to achieve with your organization’s digital transformation initiative. It’s likely their objectives, goals and use cases for digitization won’t be the same and could even be in competition. It’s unlikely that everyone will get everything they want at this stage, but by refocusing on the organization’s fundamental business goals (step one), you can align on a set of goals that will contribute to everyone’s success.

7. Set your first achievable target

This stage of your digital transformation strategy discussion will involve some metaphorical zooming in and out. Once you’ve aligned on objectives, you need to zoom in to a more tactical level and decide on the right first steps toward achieving them. That means which digital transformation technology (a content services platform, robotic process automation or intelligent automation, for example) you’re going to focus on first and in what capacity. Usually, it makes sense to focus on a singular time- and resource-heavy process. Determine what types of improvements you’d like to see by what date and figure out how you’ll get back on track if you see the process going off the rails at any point before that date.

We recommend getting the opinion of expert partners at this stage — people who have done this before and know which steps toward digital transformation are most likely to succeed, make a measurable difference in customer and employee experience, and deliver a healthy ROI.

8. Scale your plan

Now zoom back out. Assuming your first focused use case for digital transformation is a success, you’ll want to expand the technology into other areas of business and eventually add to your modernized tech stack. Make a plan for how to scale the technology you’re investing in and understand if expansion will involve further investment. You can do this by going back to the fundamental business goals you’ve been keeping top-of-mind since step one.

Again, this is a situation where getting some outsider perspective can be incredibly valuable. You know your organization, its culture and its goals better than anyone, but partnering with a vendor that has helped thousands of companies on their digital transformation journeys will ensure your strategy is sound — and keep you in the know as the capabilities of emerging technologies continue to improve.

An example of a digital transformation strategy

In many ways, Alliant Credit Union was a digital transformation pioneer. It began using an ECM solution in the 2000s, back when many organizations were still entirely paper-based. But it was only using the technology to scan, store and retrieve documents in a few departments.

When it began looking for a solution that would extend across its entire enterprise, as well as automate some of its most time-consuming processes, it went looking for a leading content services provider to partner with.

Alliant began working with Hyland and implemented OnBase to begin automatically capturing documents and information in place of its legacy system. Then it started using OnBase to access information across integrated systems rather than printing them. Next, it transformed its manual accounts payable (AP) process into a powerful automated powerhouse and used that automation experience to build additional mission-critical workflows in HR, AP and Legal.

Once these use cases were all working smoothly, Alliant and Hyland teamed up to custom-build a fraud management solution that was so easy to use, it took employees just an hour to master.

As part of its digital transformation strategy, Alliant Credit Union has continued working with Hyland to optimize across the enterprise. “We still have other manual processes,” Lally said. “We want to create more efficiencies, increase accuracy and lower our costs through structured processing. This allows us to continue to move quickly to provide great service to our members.”

Read more about Alliant’s digital transformation