Five Warning Signs When Retailers Change Their Digital Business Strategy

 

When a retail company embarks on a digital transformation program, it can sometimes be hard to gauge the success of the transition. Here are some warning signs that may signal that it is time to reorient a digital transition for greater momentum and success.

1.   Employees don’t agree about the end goal

“For digital transformation to work, everyone in the organization – from bottom to the top – needs to align on its desired outcome” says Stephanie Woerner, a research scientist at the MIT Sloan Center for Information Systems Research (CISR). She studies how companies manage organizational change caused by the digitization of the economy.

Ms. Woerner points out that successful digital transformations are about organizational change. Change an organization is hard enough without trying to do one where a good chunk of the organization does not agree on the end goal. The CEO must communicate – no, sell – to his associates – the new goal of the transformation. He must work will all levels of the enterprise – operation and merchandising managers – must clearly understand the goal of the transformation. In many cases front-line associates – the salespersons – must be part of the team to ensure compliance and endorsement of the plan. Often their attitude with a customer can breathe success or failure.

2.   Leaders want short-term results instead of long-term ones

It is hard not to look for immediate return on investment (ROI) when you are making a big change. However, Stephanie Woerner suggests that leaders must resist the impulse and instead look further in the future. Woerner says that it takes discipline and the willingness to forgo short-term gains for long-term benefits for the entire enterprise.

3.   There is not a specific roadmap

Ms. Woerner says that to “reach a new destination, you typically need directions. The same applies to digital transformation”. She correctly notes that employees need transparency to what is going on, they must now what to expect and they

should see their role in the transformation. A clear roadmap makes it more difficult to change the process.

4.   There are no measurable metrics

Everyone needs to agree on the end goal, then they can establish metrics to measure that goal. Otherwise, they will not know if they met the goal. Metrics focus attention, and selected metrics measure those outcomes. Stephanie Woerner says “Metrics also support enterprise learning. Not hitting a metric is a signal that things are not on the right track and the enterprise should take some time and figure figure out why the transformation does not seem to be working”.

5.   Digitization is not influencing work culture

“If your digital transformation has not also transformed the way your business works, it likely has not gone far enough” says Stephone Woerner. She continued “digital transformations are about making changes to increase operational efficiency, customer delight and innovation.”

Ms. Woerner’ s warnings are clear. By looking for the five warning signs on the path of digital transformation, you can quickly correct the course before it is too late. The whole store organization is rooting for success.

As a postscript Ms. Woerner adds that by looking out for these warning signs on the path to digital transformation, you can course-correct before it is too late and ensure success.

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