So, you have your Digital Transformation strategy. How do you know if you even have the resources to execute it?
Previous articles explained how digital transformation impacts the entire company and, therefore, requires an enterprise strategy that balances culture and technology. When you build your digital transformation strategy, you’ll define strategic objectives and measurable goals. Then, you’ll engage members of your staff to translate those objectives and goals into action plans, or projects.
That’s where strategic planning typically ends and is one of the reasons why most digital transformations fail.
Stated differently, strategy without execution is just a dream. But how can we be sure that we can execute our digital transformation strategy?
The first two steps are effective resource planning and performance management.
I’ve seen countless companies that may get as far as six months into execution of their strategy before they realize they don’t have the human resources to execute the strategy. They developed their action plans and maybe even assigned people to projects. But they never stopped to check if the people had the bandwidth to deliver.
It turned out that Sally was committed to 120 hours a week, the marketing team didn’t have enough people to build the future campaigns and still keep the current campaigns afloat, IT had to choose between keeping existing systems running or building new products and systems, and the list goes on.
Our best practice is to sort the action plans, or projects, by value. In most cases, that means return on investment. Sometimes it may mean speed to cash positive. Whatever your company’s priority is, make sure the executive sponsor for each project states the value. Then sort the projects from highest value to lowest.
Now start assigning resources to these projects, being mindful of the hours you’re asking them to work. You’ll soon see that your best people can’t work on every project. And, at some point, you’ll run out of people altogether. Draw a line under the last resourced project.
If we can hire, outsource, or add contractors to a project and still have positive financial results, then consider those options. Now move the line down and extend the list of projects that are feasible.
Every project that falls below the line should not be attempted. That may mean you have to revisit your strategic objectives and goals and make them slightly less ambitious. It’s better to have realistic goals that you can achieve than lofty goals that you fail to meet year after year.
In fact, according to Harvard Business Review,
“Companies on average deliver only 63% of the financial performance their strategies promise”
Can your business survive if you only deliver 63% of your digital transformation?
Now that your projects are realistically resourced, let’s add an insurance policy to our ability to execute.
We translated strategic objectives into measurable corporate goals, and we translated those goals into manageable projects. The we assigned people to those projects. So, didn’t we already define the goals for those people? Now let’s formalize them in performance plans.
Personal performance objectives should certainly include personal development, supporting the company values, and other “soft” skills. But, first and foremost, they should align each individual with the company strategy. In this case, it’s the digital transformation strategy.
Performance objectives and, in my opinion, merit increases and bonuses, should be tied to execution of the action plans that support the strategy.
A programmer may be required to deliver specific features for a new product or app. A graphic designer may be responsible for the images that will be used in the campaign to promote that product or app. A corporate trainer may have to ensure that the salespeople gain the technical fluency to sell the new product or app.
Each of these individuals may only succeed if their team succeeds. That drives alignment and teamwork. You can bet that I’m going to pitch in and help my teammate if my bonus is dependent on us all succeeding. (OK, I would help out regardless of the bonus, but you probably get the point.)
Clear performance objectives, derived from the action plans to which each individual contributes, drives alignment and teamwork. And that increases the probability of your digital transformation succeeding.
Strategy management is the marriage of strategy and execution. Strategy without execution is just a dream. Strategic planning exercises usually end once the action plans are defined.
You can gain a competitive advantage for your business by translating strategy into execution. And the first steps are effective resource planning and setting clear performance objectives that align your team members with the digital transformation strategy.
Don’t be one of the majority of companies that delivers only 63% of what your strategy promises. In the world of digital transformation, those are the companies that get disrupted.
In the coming weeks we will cover the following, critical aspects of digital transformation:
- Executive Sponsorship Role and Accountability
- Change Management
- Scope Management
- Marketing and PR
- Staff Challenges and Surprises
- The New World After Digital Transformation
If you’re embarking on a digital transformation, planning to do so, or just don’t want to wait 12 weeks for all of these articles, just email Emily at Emily@WolffStrategy.com and she’ll be happy to schedule a call with me to discuss any or all of these topics.
Larry Wolff is the founder & CEO of Wolff Strategy Partners, a boutique consulting firm specializing in Enterprise Strategy Management and Digital Transformation. Larry has served as CEO, COO, CIO, CTO, chief digital officer, and management consultant for public, private, international, and emerging growth companies. His specialties include corporate and IT strategic planning, technology led business transformation, business and IT turnarounds, merger integration and large-scale project rescues. His methodologies span industries and scale to companies of all sizes.
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