‘Ignorance about the benefits, lack of courage to undergo transformation’
Published on : Friday 02-07-2021
Niju Vijayan, Executive Director, Avanteum Advisors LLP.
What are the factors that make companies wary about digitalisation in their plants?
Culture: This is a key element and this typically flows top-down. The strategy outlook of the management and its willingness to embrace technologies defines investment in digitalisation. Sometimes its ignorance about the benefits while other times, its lack of courage to undergo transformation.
Not aware of the velocity of external changes: Many organisations are so narrowly focused on their products that they tend to miss out clear and loud signals about the external business world moving faster than their own.
Lack of clarity on RoI: The management is not convinced on the benefits that will accrue by implementing digitalisation projects. This may also emerge from lack of scale in the project or wrong selection of the area of the project.
Absence of a long digital strategy: Organisations that haven't formulated its long term digital roadmap run a high risk of failure when implementing projects. Examples of unsuccessful companies make new interested candidates sceptical.
How can companies ensure their digital transformation succeeds? What measures do they need to put in place?
Digital strategy: The objectives of this proposed transformation needs to be spelt out clearly and unambiguously.
Leadership by management: The top executives need to lead the charge to instil confidence and belief in the rank and file. Its importance as the strategic initiative needs to trickle down to every single employee.
Right team: The right capable and result oriented team needs to lead the transformation. This team should have the complete trust of the management and needs to be imparted stability.
Right partner(s): Digital transformation is a highly complex project and only competent and capable teams can undertake such projects. They should design it future-proof.
What are the common mistakes companies make while embracing digital transformation and how can these be avoided?
Under-prepared team: The organisation has to be prepared to operate in a digital environment else the plan will flounder.
Complete buy-in: The organisation needs to believe in the initiatives and all employees need to be part of it.
Syncing up with customers: The transformation sought to be made has to be aligned with your customers. Doing it in isolation will lead to quick failure.
Alignment with supply chain: In the eagerness to transform fast, the partners are left behind with disastrous consequences.
The world is now well into the second year of Covid disruption. How has digital transformation helped the industry during this period?
The pace and extent of change varies from industry to industry. While some have been directly impacted, others have been affected by changes undergone by their partners. Digital transformation has been done during a period when there was an absolute necessity and hence resistance was negligible. The pandemic and slack business period allowed certain experimentation to be done without affecting regular business.
There has been tremendous savings for organisations on account of low operating cost. This positive development is being sought to be perpetuated in the long run, to the extent possible
In the Indian context, despite government initiatives, the digital divide persists which risks leaving large segments of the population outside. How can these issues be addressed?
Socially and financially inclusive programmes, backed up by legislative teeth will bring about the change.
(The views expressed in interviews are personal, not necessarily of the organisations represented)
Niju Vijayan is the Executive Director with Avanteum Advisors LLP. He has 20+ years of experience advising clients formulate strategies and actions in rapidly disrupting markets and industries. He has expertise in the areas of manufacturing and electronics. During his long career, he has advised global corporations, home grown business houses, SMEs and government on a variety of business issues.