Most journeys are full of twists and turns, so guidance along the way can keep you from going astray. I’ve led successful supply chain digital transformation efforts in high-tech, retail and telecommunications, so in the interest of helping others, I have some hard-won lessons to share from my own experiences.
Top four pitfalls to avoid during your digital transformation:
- Failing to create a shared vision for all stakeholders
- Not curating the right transformation team
- Lifting and shifting existing processes
- Omitting change management in your initial project plan
Embarking on a supply chain transformation can feel like a daunting, epic task. Supply chain organizations are entwined with so many other partner organizations that any change requires a systems-thinking approach, process innovation and dedicated focus on change management.
Establish your vision
In the words of Harvard Business School professor emeritus John Kotter, widely considered the leading expert on the topic of leadership and change, any transformation requires you to create a sense of urgency, a vision for why now and a prediction for what the future could look like. Especially during times of disruption, a crisp vision of your future supply chain and resultant benefits to your organization is critical for success. This vision needs to be reflective of all the different stakeholders impacted by the change, not just those engaged in the process.
It needs to complement key performance indicators (KPIs) too. When defining KPIs, don’t be afraid to make aspirational (yet realistic) projections of resultant metrics. It’s better to aim for your moonshot in setting the metrics and use them to directionally motivate your team. Do not forget to baseline the current situation. Having a baseline and projected value greatly outweighs the potential nervousness of overpromising the project results.
With vision and metrics in hand, describe your plan. One trick I’ve used is to map backwards. With your end vision described, identify the major milestones to reach that vision. Don’t feel like you need to do this alone. Engage others who can populate, validate, and ultimately own those milestones. And include celebrations in the plan as a way to recognize your team!
Create the right team
Transformations are impactful and tricky, so you need a team empowered to handle both conditions. Representation from all areas of the organization engaged in the change need to be part of your team. If, for example, there will be impacts to financial models, marketing plans or sales practices as a result of your supply chain transformation, then people who are experts and can be your advocate in those communities need to be part of the official team. A project of mine required a new approach to inventory management for retail store staff, so we engaged the field team representatives to champion the change.
Identifying the right people can be a challenge. As one expert advised me, there should be no potted plants (people who provide little value but are easy targets to offer as team members). You want people whose absence will be a bit painful when they are out of their day jobs. The ideal profile is someone with a depth and breadth of knowledge for their domain and enough seniority to make decisions.
With the right team in place, a “one team” model should be instituted. I like to say, “Leave the sports coats at home,” meaning you shouldn’t be able to tell the difference between the business, IT and consultants by the “uniforms” by which they are identified. In one of my more recent projects, we grouped people by the process they were responsible for in order to create comradery and functional accountability. This decision helped create synergy from process design to technical implementation.
I learned about these forms of principles-based governance and distributed leadership from Mark Bonchek, a pioneer in digital thinking and change management I first met when he keynoted an executive education event. Essentially this structure allows leaders to ring-fence decision-making and empower the team, enabling incredible agility in process design and technical execution. Empowering a working team in this way will keep a transformation on task while ensuring critical decisions are still escalated to the executive sponsors.
Focus on process
Process, process, process – please don’t just lift and shift! Merely moving work to a new technology without examining the underlying workflows will not bring about true change. Use transformation as an opportunity to evolve and modernize your processes. Often legacy processes are wrought with a culmination of system constraints and workarounds. I remember a discussion with a former colleague frustrated after just such an experience. She had completed a supply chain planning transformation without the resultant benefits. Unfortunately, prior process and associated bad habits migrated with the new system. Bringing new technologies and capabilities should be a catalyst to re-evaluate and potentially change your processes to fully embrace new ways of planning and executing your supply chain.
Change management might be the most critical element in your transformation journey. Too often I’ve seen change management initiated as an afterthought. Engaging a change management expert to participate in everything, from project kickoff to blueprinting through implementation and rollout, ensures a robust, well-described change plan. Transformations don’t end at implementation. They’re just getting started because the next critical steps are about adoption and institutionalizing the new capabilities. Understanding each impacted party’s perspective, sentiment towards the change and willingness to adopt are keys to a transformation realizing its full value.
I’ll be writing more about each of these topics and talking with other experts along the way in a forthcoming series of live interviews. For those who’ve made it even partway down the road, I welcome your own shared experiences so we can guide others along the way.