Organizational Barriers to Digital Transformation

Abstract: Digital Transformation is changing the ICT industry and companies must act with speed to stay in the race. In order to be a credible business transformation partner, responding to industry changes and customer demands faster, companies today are transforming themselves and embarking on their digital journey and digitalization is high on every company’s agenda.   Most of these transformation initiatives fail or are progressing slowly and one major reason for this is organizational barriers to transformations. These barriers are challenging as organizations and employees react differently to change. Hence in this paper, I will study the transformation process and try to identify and understand the barriers and the most challenging stage of the transformation by interviewing eleven executives from across companies which are in various stages of their Digital Transformation journey. Even though significant number of barriers were identified in the Initiation and the Transition phases, the results indicate that each phase is equally important and is an outcome of the previous phase. By addressing barriers in the first two phases and taking concrete actions, the resistance can be reduced, and organizations can smoothly transition and transform ensuring that the organization and staff embrace the changes.   Several barriers to change and transformation were identified ‐ Unclear Company Vision and Goal of the Transformation; Top Management, Leaders and their Leadership style; Project group, Organizational set‐ up and Agility; Change and Middle managers lacking expertise; Lack of Rewards and Incentives; Unclear Measurement systems, Lack of HR involvement and a strong Learning culture missing.   In this work with executives working across a variety of industries, the findings suggest that by putting people first and by running change management programs with more people‐centric approaches can lead to dynamic results. The study revealed the need for top leaders and executives to present a united front, provide more autonomy, increase collaboration and transparency across project functions and structures. Middle managers and HR need to work together bettersupporting and coaching the employee’sindividual development plans, tracking changes, creating an atmosphere that engages and energizes employees and by rewarding or incentivizing employees ensure that the changed behaviours stick and quickly spread throughout the organization. Siloed organizational structures were further identified as making the organizations obsolete and the transformation journey must begin by putting together diverse project teams encompassing the right capabilities and skills with a clear driver of change.