Why must digital transformation be a “top leader” project?

Starting from digital transformation, this article objectively analyzes how enterprises can successfully achieve digital transformation from the perspectives of user value, business processes, and enterprise framework. It is recommended for enterprises that need digital transformation.

Not long ago, two listed companies came to me and hoped that I could help them solve their most pressing problem at the moment - "private domain traffic".

As we gradually deepened our communication, I found that they were not only trying to solve the problem of private domain traffic, but also the problem of enterprise digitalization. So I told them that it would be best to discuss this issue with the boss or the top leader, so that they could succeed. Finally, we had an in-depth communication with the top leader of the company.

Why is it necessary to communicate with the top leader when it comes to digital transformation projects? This article gives you the answer.

The COVID-19 pandemic has made more companies realize the necessity and importance of digitalization. Today, we see that many companies are accelerating their digital transformation.

This digital transformation is not just about digital management, the really important part is actually the digitalization of business, that is, how to fully digitize the supply chain, channels, marketing, sales, customers and other links , which can truly determine the success or failure of a company's digital transformation. From this, we can see that management and business are everything for a company, that is to say, digital transformation is related to the overall situation of the company and is a complete transformation.

In this case, apart from the business owner, the top leader, no one can be responsible for the overall situation of the company. There is no doubt that if digital transformation is to succeed and advance, it must be a "top leader project."

1. The top leader understands “user value” best

The only mission of an enterprise is to create value for users and solve problems. What value should be created for users? For which users should value be created? How to create value for users? All business activities of an enterprise are to answer these three questions.

To answer these three questions, it is not about a department or team, but about going beyond the team and returning to the original intention, mission, and vision of the company. Only the top leader knows this clearly and can instill this awareness into the entire company team for execution. Digital transformation first requires responsibility to users, delivering user value through the digital world, and creating a better user experience.

Therefore, digital transformation cannot be left to the IT department alone, not because the IT team is incapable, but because for the enterprise, IT is a tool, not an end. The top leader must clearly convey the user value, then link it with IT capabilities, and systematically design the relationship and path between each module to ultimately achieve the creation and delivery of user value.

2. The top leader understands the "business process" best

The butt determines the head. Once a company reaches a certain scale, each business department has its own "butt", and conflicts of interest will arise between different business departments. In the major operation of digital transformation, conflicts of interest will be particularly intense.

Will it increase the cost of the department? Will it increase the efficiency of the department? Who will be credited for the performance? How should the reward mechanism be designed? Will the employees get more or less money? Will the work to be done increase or decrease? Every department has its own calculations and will become "short-sighted", focusing only on the immediate benefits.

At this time, only the top leader can step out of business decision-making and look at corporate development and processes from a higher perspective. This is not a problem that the technical department cannot solve. It is difficult for any department head to affect the overall reform. And this "difficulty" has nothing to do with how high the position or how big the reputation is given to him by the company. This person can only be the top leader himself.

Only the top leader can comprehensively consider the enterprise's operating model and use the capabilities brought by digitalization to reconstruct new business processes. This process is bound to change the short-term profit structure, and only the top leader has this decisive power.

3. The top leader understands “enterprise architecture” best

The enterprise architecture diagram is an X-ray scan of the enterprise. The organizational structure of a company is the real "existence" of the company in reality. In the digital transformation, if the enterprise wants to redesign user value and change business processes, it will definitely involve supporting adjustments to the organizational structure.

The organizational structure of each company is different, and the characteristics, formation background, and evolution process of the current organizational structure are also completely different. If you cannot fully understand the genes in the organizational structure, it will be difficult to prescribe the right medicine, make a reasonable adjustment plan and implement it. In this regard, it is difficult to rely solely on the HR department and external consulting companies.

Only the top leader can personally take charge. Moreover, reform is not static, nor is it a one-time thing. Enterprises face huge changes and uncertainties in the market every day. Enterprises must be able to respond and change quickly, while maintaining relative stability and durability, in order to develop healthily and sustainably.

This requires that the company's organizational structure be both resilient and flexible; it must meet current needs while leaving room for future development. During digital transformation, adjustments and changes to the organizational structure will cause pain, but only the top leader must make the decision and take responsibility. This must be a top leader project.

4. Final Thoughts

The top leader is the "captain" and "helmsman" of an enterprise.

Only the top leader can see the distant goal and control the direction of the voyage. Digital transformation is not about tinkering with the internal structure of the enterprise, but about repositioning and participating in competition in the business wave. The captain is needed to plan the route, set the goal, and organize the working methods of all crew members.

Therefore, successful digital transformation must be the company’s “top priority” project.

Author: Yan Tao Sanshou

Source: WeChat public account "Yan Tao Sanshou (ID: yantao-219)"