Navigating Buzzword Overload: Digital Transformation

Some buzzwords begin as well-intentioned shorthand for complex topics; time, however, can turn a good thing into something else.

I continue to connect with people who are “thinking big,” looking to turn challenges into opportunities in their fast-changing world. For many, Digital Transformation has been a catch-all term for many projects, as organizations harness technology to delight customers, revolutionize products and services, optimize operations, foster innovation, develop engaged teams, and promote corporate social responsibility.

That breadth of opportunity contributes to the confusion and disillusionment we all feel regarding “Digital Transformation.” I think “Transformation” was originally a helpful way to sum up the potential for creating new value as technology advances became accessible, powerful, and cheap.

And there was (still is!) a ton of pent-up demand. But here’s the problem: historically, technology is focused on bottom-line, run-the-business processes. A dead giveaway for this limited thinking is project ROI studies that focus solely on productivity and cost reduction. The ongoing expense of these projects is seen as a cost element, not a revenue producer.

So “technology” is overhead, and “digital” is just the latest way to sneak it past the controller’s gaze. The challenge is still there, aggravated by the added haze of buzzword overload. A significant issue is the focus on tech and technology – a common pattern I see and hear repeatedly from internal IT teams and technology vendors alike. The focus is always on the tech, talking about What the system can do – fresh features and advanced algorithms – without paying attention to Why the business might want to do all that neat stuff in the first place.

What is your Business Strategy?

A more effective approach is to focus on the stuff that matters to the company. What are the problems to solve, what are the opportunities to grab? How can we advance the short- and long-term objectives? How can we clearly align with the business strategy?

To be fair, many companies do not have a clearly articulated strategy. When this is the case, help is available; a classic Harvard Business Review article by Collis & Rukstad (Can You Say What Your Strategy Is?) lays out a simple framework for articulating an organization’s path to winning.

• Objective: What overall endpoint are you trying to reach? You must have a clear picture of what “done” looks like
• Scope: What are the boundaries, the scope of what you are trying to achieve? Don’t fall into the trap of trying to “boil the ocean” – a specific focus is vital.
• Advantage: Simply put – how will you win? What critical differentiating advantage, what important new method, are you bringing that will deliver the results?

I like simplifying this to What You Do, Where You Play, and How You Win. An essential feature of this method: the authors strongly suggest a streamlined description – 35 words or less. This keeps the “pitch” from getting too wordy and losing focus (and the audience’s attention).

What if your company doesn’t have a tightly stated business strategy? No problem – just take a stab at writing one yourself. Here are some examples …

• Yeti manufactures premium outdoor products (What You Do) for outdoor enthusiasts (Where You Play). They win through superior quality, brand loyalty, and a direct-to-consumer model (How You Win).
• Weber produces grills and related accessories (What You Do) for consumers seeking outdoor cooking solutions (Where You Play). Their market leadership and innovation drive success (How You Win).
• Tupperware Brands creates food storage and kitchen products (What You Do) for households globally (Where You Play). They thrive through a strong direct-selling network and innovative solutions (How You Win).

I didn’t get these from corporate websites or annual reports; I just tried to keep it simple, based on what I know about these brands. These descriptions all comfortably fit the 35-word limit – it’s best to use up the whole 35-word budget and add some specifics.

Don’t worry if it’s not perfect; it is enough to start the conversation!

What is your Digital Strategy?

The Business Strategy gives context to ideas and initiatives that can create value for the company. Your Digital Strategy can follow the same pattern, aligning your transformation projects with the business in a way that makes sense.

• We are launching an eCommerce platform with a mobile app for seamless customer access (What You Do). This move will expand our online presence (Where You Play) and tap into dealer and direct-to-end-user markets. We will provide a user-friendly, mobile-centric experience, enabling us to leverage data-driven insights for targeted sales and marketing (How You Win).
• We are replacing the internal accounting system (ERP) to optimize operations and data management. Significant focus will be given to streamlined manufacturing processes, enhanced decision-making, and supporting growth (Where You Play). This effort will ensure a robust, scalable operating system that improves efficiency, reduces cost, and enables agile business operations (How You Win).
• We are implementing advanced supply chain forecast tools for optimized inventory management (What You Do). These tools will enhance supply chain visibility, reduce costs, and help meet customer demand effectively (Where You Play). Our teams will be able to utilize accurate forecasting, real-time data, and efficient inventory control to improve supply chain efficiency and profitability (How You Win).

Digital Transformation Revisited: A Simple Name for a Clear Strategy

Note that these are all broadly different types of initiatives, all of which could be simplified with the “digital transformation” label. Now our buzzword is doing the work we want it to – reducing a specific and complex idea into a few simple words, a lovely little thought nugget that can be included in other, broader conversations with a fuller understanding of what this means for your specific company.

Digital transformation initiatives can focus on any combination of the five components of a great digital business (Customers, Operations, Products, Data, and Team), all of which can produce significant value for the company. That’s a broad spectrum of digital awesomeness – as long as you clearly define and align up front.