From Digital Transition to Digital Transformation
If you want to realize the benefits of technological innovation, start by thinking and acting like a digital pioneer. According to research from SMB Group and Vistage Research, 84% of leaders identified as digital pioneers expect their company’s revenues to increase this year, which is a significantly higher percentage than that of other leaders surveyed.
What makes digital pioneers different is their digital-first mindset. They innovate through technology, instead of innovating with technology. They don’t settle for digital transitions, where technology is applied to analog processes to improve productivity. Rather, they pursue digital transformations, in which technology is used to reimagine business processes, practices, models, culture and customer experiences to meet changing market dynamics.
Contrary to what most people believe, digital transformation is not an IT project. It’s a leadership initiative. And that may explain why so many companies struggle with it, as only about 30% of those who pursue a digital transformation actually complete it.
Two Vistage members, Dave Sackett and Jeff Dewing, are among those few. Here, they explain how they’ve used technology to transform their companies and industries.
Vistage Member Case Study: Digital Transformation as an Efficiency Strategy
At ULVAC Technologies, Dave Sackett is more than a chief financial officer — he’s a visionary who has used technology to transform his company’s processes, workflows and internal systems.
“I’ve always tried to implement the latest and greatest technology to move my company forward,” says Sackett, who regularly travels across the U.S. to teach other CFOs about leveraging artificial intelligence, blockchain, machine learning and other emerging technologies. “Digital transformation gives you an opportunity to come up with something brand new. It allows you to rethink some key questions: Where’s the information going? Who’s the audience? Is this something that even needs to be done anymore?”
When Sackett was in the process of transforming ULVAC, he focused on the goal of efficiency. For example, he implemented a modern enterprise resource planning (ERP) system and integrated robotics process automation to streamline workflow. “Manual transactions and tasks that are repetitive — where there’s no real thinking involved — are my No. 1 things to automate,” he says. He also transformed internal systems to make it quicker and easier for employees to access the data they needed to do their jobs well.
“In the past, people would come to a department, ask for a report, and wait while someone generated it,” he says. “It was a big waste of effort. Just giving direct access helps speed the process along.”
Acknowledging that digital transformations are never easy, Sackett offers several recommendations to leaders looking to embark on the journey.
Align goals and expectations, starting with the senior leadership team. “They can push down the directive that change is good for the company,” he says.
Give employees the time and tools to adapt to new processes and systems. Sackett took a year to implement his company’s new ERP system, even though his vendor said they could do it in three months, because he knew his team needed more time to transition. “They weren’t going to have enough time to ‘play in the sandbox’ using a demo to do transactions and understand the process,” he says. “I took it really slow and methodical, so that when we did go live they were more than comfortable in the new system.”
Force employees to commit to new processes so they don’t fall back into old workflows. “If you have an employee who wants their expenses paid, make them go through your new automated accounts payable process; don’t let them submit paper expenses,” he says. “Teach them that if you want it done, you have to adapt.”
That last point speaks to Sackett’s broader philosophy about digital transformation. “It’s about rethinking your business in a digital way, versus the analog way or the way of the past.”
Vistage Member Case Study: Using Technology to Change Human Behavior
After working in senior roles with some of the world’s largest facilities management companies, Jeff Dewing became frustrated that his industry hadn’t evolved since the 1960s. He believed that the facilities management sector needed new technology and a cultural shift — and decided to come up with a solution to make it happen.
“I started building technology for facilities management that focused on human behavior change,” Dewing explains. “The technology aimed to make outcomes in facilities management entirely transparent — whether they were good, bad or ugly.”
That vision eventually became Cloudfm, the cloud-based facilities management company that Dewing co-founded in 2011. Today, Cloudfm provides a complete facilities management solution that uses technology to oversee building and equipment for companies. Its clients span the retail, restaurant, commercial building, hospitality and charity fields, and include such well-known brands as Pizza Express, KFC and The Guardian.
Before Cloudfm, the only facilities management system available to companies was fundamentally flawed, as its data was susceptible to alteration, which made it unreliable. Cloudfm’s solution, by contrast, is tamper-proof. Users can’t delete or amend records. As a result, when on-site engineers complete a task — whether it’s changing a light bulb or fixing an air conditioner — they have to report what they did, how they did it, and what materials they used.
The goal, Dewing says, is to focus on outcomes and then work on optimizing those outcomes. “If the outcome is great, we’ll celebrate it,” he explains. “If it’s poor, we’ll re-educate or retrain the engineer. But we do not change the data. And that’s the primary difference between Cloudfm and the rest of the industry.”
The company’s innovative approach has been recognized by more than just the industry. It recently received two prestigious accolades, The Queen’s Awards for Enterprise: Innovation 2019 and inclusion in the London Stock Exchange Group’s “1000 Companies to Inspire Britain.”
While Dewing acknowledges that technology is core to Cloudfm’s success, he emphasizes that culture is what makes his solution really work. When companies create an environment that allows their workers to be honest — and admit mistakes without suffering repercussions — that enables people to be their best, he says.
“Once you achieve that shift, then suddenly all stakeholders will focus on resolving the problem, not on who is to blame,” Dewing notes. “This doesn’t happen overnight. It’s about having the right level of expectation.”