By Global Organizational Culture Guru Arthur Carmazzi
If you are ready for Digital Transformation… there is a larger than 89% you’re NOT! While the rewards are huge, the cost in time and money to initiate it is vast and, according to a McKenzie Digital “Unlocking success in digital transformations” study, most of the initiatives they surveyed had success rates between 4% and 11% and up to 26% in the Tech industry… and those numbers SUCK!
But… another study by the Economist Intelligence Unit, shows that those who have succeeded are showing profitable results in as little as 2 years and 72% of say Organizational Culture Change is required for the success of a Digital Transformation initiative. So if you get it going IT WILL PAY OFF!
WHY most organizations fail in Digital Transformation efforts
If they do culture change, organizations often start their culture change initiatives at the same time they begin their Digital Transformation initiatives… and most of the time, the culture is Not Ready! Too much to do without an “evolved” organizational culture and the whole thing falls through. And, if their culture change initiatives are top down… they are almost certainly Doomed to ultimate Failure!
But the solution is not complicated or expensive. It all starts with benchmarking how evolved your organizational culture is to get an idea if it’s aggressive and agile enough to make it through the Disruption Responsiveness hump.
There are 5 levels of organisational culture evolution:
The Blame Culture – little trust, people wait to be told what to do, and little cooperation or innovation.
The Multi-Directional Culture – people are cliquish within their departments, but low trust and cooperation with management or other departments.
The Live and Let Live Culture – things get done but people are complacent and lack passion and creativity.
The Brand Congruent Culture – people believe in the product or service and support each other to expand on it. Innovation and passion is supported through processes, management and culture.
The Leadership Enriched Culture – leadership is the role of everyone, and most are firm believers in the brand and the organization. Being creative about building the business supports excitement and people feel a sense of ownership.
Digital Transformation requires a culture that is agile and has an established sense of trust. To succeed in a Digital transformation initiative, the minimum requirement of culture evolution would be the Brand Congruent Culture.
The reason most organizations attempting Digital Transformation fail, is because the are only evolved to the Live and Let Live culture at best. And that is being generous! Based on the DCI culture evolution study that began in 2017, 61% of organizations are still in the Blame Culture. Only 9% of organizations make it to the Brand Congruent Culture and 4% to the Leadership Enriched culture. Which seems to corollate with McKenzie’s success rates.
How do you know if you have a successful strategy for your culture evolution initiative?
To evolve to a Brand Congruent culture, you need to develop the right psychology, and there are 3 psychological factors that support an evolved culture that will be sustainable and agile.
- A stakeholder (employee) created set of guiding principle (behaviors) to ensure a great culture for all to succeed in.
- A systematic way to support people to express and personally feel their value to the organization and its objectives while applying their desired set of behaviors.
- A measurement system to measure the and visibly communicate the No. 1 and No. 2
So here are the 5 steps to take BEFORE Digital Transformation
- Benchmark your current organizational culture evolution! This is done with the OCEAN Culture Evolution Assessment. You will need perspectives from a minimum of 20% of the organization at different levels (Senior Management, Middle Management, and non-management) to get a usable understanding.
- Identify the gaps from where you are to where you need to be (unless you are already at Brand Congruent Culture or better).
- Share your results and culture goals with everyone. Include the description of what the Goal Culture will be like. See: The Ultimate Guide to Leading Organizational Change
- Begin your initiative with the above 3 factors in mind. Get the “Key Influencers” and everyone involved in feedback and implementation for making it happen. Also look at the article on One of the root causes Trust Fails in organizations to support the initiative. There are 3 elements that are essential for success in this step:
- It must be a top guided, Bottom Up initiative
- Desired behaviors must be measured often to show progress (see: squadli performance measurement app)
- The people of the organization must see fast results to maintain momentum
- After 4 to 6 weeks, test the culture again to see progress and compare the graphs and evolution improvement. Share the progress and how ready (or close to ready you are). Sharing the measured progress supports motivation and excitement that the people are achieving the results they have set out to achieve.
To succeed in a specifically in a Pre-Digital Transformation Culture Change Initiative, the behaviors should be related to:
- Proactive actions
- Fast decisions
- Active trust (trusting people even if you don’t really trust them)
- Synergizing/Leveraging with people who have different Ambiguity Relief Processes (Genetic process of getting clarity)
- Short impactful meetings
- Open communication (Identify and relate Communication process: coloredbrain.com)
- No Blame (see noblame.zone)
Every change initiative has resistance… but remember, people do not resist change. Imagine someone shows up at your door and hands you $10 Million to change your life… chance are you will not say, “Na, I’m good!” …you will most likely embrace the change and take the money.
What people resist in “Stupid Stuff”, something they feel will not benefit them or just makes life more difficult. But when the people are creating the culture in a top guided bottom up initiative, they own it, they are creating the change they want. And it is not about getting more salary (this should be pre-defined just in case), it is about creating a Clear, Supportive, Trusting, and Fun working environment where they can “feel” personally successful in the process of achieving organizational objectives?
Once the people are on board and excited about the possibilities and feel they can visibly help the organization and its brand with their own creativity… you are set to begin the Digital transformation efforts.
You have just increased your chances of Digital Transformation success by 300%
NOTE: Evolving an organizational culture to a higher level has lots of moving parts, but in our experience in doing over 30 Organizational Culture Change initiatives… as long as the criteria is met (see the Ultimate Guide to Organizational Culture Change), and it is initiated and implemented in a very short time, it AWAYS works and it is always sustainable.