The COVID pandemic has without doubt accelerated a lot of technology transformations. With little to no notice, we started working from home. The IT and digital teams globally worked hard to make this enormous change in record time. Some companies were already well prepared for this transformation, others were not but most got through will minimal disruption. The big question is, do technology transformations deliver real tangible value?
I’ve just read a paper by McKinsey highlighting seven lessons on how technology transformations can deliver real value. Here are my highlights
1 – Technology investments are creating significant business value. In their latest survey McKinsey concluded that technology transformation activities appear to be paying off. Over the past 2 years 59% of respondents say they saw some impact or significant impact on the realisation of new revenue streams. Similarly, 68% saw some or significant impact on increased revenue from existing streams.
2 – People focused initiatives result in the most value. Interestingly those companies that transformed their approach to talent (in technology) saw the greatest impact on business. These initiatives included changes to attract, retain and upskill talent. Those companies that focused on transforming their talent strategy saw bigger gains in realising new revenue streams, increasing revenue from existing streams and reduction in costs.
3 – The top performing companies execute more transformations than others. McKinsey noted that these top performers not only saw more value as a result of technology transformations, but they also ran multiple initiatives. On average they ran 5 out of 10 transformation initiatives versus three at the bottom quartile of companies.
It looks clear that technology transformations can deliver genuine and measurable value to an organisation. Many companies have realised that one of the key elements of transformation is having the right skills and experience in the team to maximise the success of an initiative. This element is often overlooked. Those companies that have a clear talent strategy to bring in new recruits, develop and retain existing employees, appear to be reaping the rewards of their investment.
Beyond their focus on talent, deployment of new technologies, and a broad transformation agenda, the top performers also follow several practices that foster a stronger partnership between technology and the business