Technology Management Professor Paul Leonardi on Successful Digital Transformation
As seen in the December 2020 MIT Sloan Management Review
At the 30,000-foot level of the corporate suite, plotting digital change is heady, exciting stuff. Business leaders can almost smell the gains in efficiency and speed and the data-driven increase in customer satisfaction when they think about all the new tools at their disposal and how they might restructure their organizations. As one senior executive at a large telecommunications company recently told me, “Mapping out a new approach to compete in the digital era has been so cool!” But here’s the decidedly less cool, more mundane truth that I’ve learned after 16 years of working on such transformations with more than two dozen companies across eight industries: Success depends less on strategic inspiration than on the way people on the front lines implement new digital tools, and most leaders aren’t laying a foundation for those employees to succeed. In large part, that’s because senior managers don’t have any idea what really happens at the ground level. So they’re caught by surprise when tools don’t get used the way they’re supposed to be (or even at all), data-driven insights prove unremarkable, and anticipated gains fail to materialize. Their digital transformations become digital flops. To avoid that fate, leaders must understand how digital tools come to be used widely and effectively so that they can create an environment that provides optimal conditions. They can’t hand that work off to IT and hope for the best.