1 00:00:03,640 --> 00:00:05,440 To identify the key factors 2 00:00:05,440 --> 00:00:06,480 that drive success 3 00:00:06,480 --> 00:00:08,400 in a digital transformation, 4 00:00:08,760 --> 00:00:12,040 BCG recently surveyed over 800 senior executives 5 00:00:12,040 --> 00:00:14,480 globally across all major industries, 6 00:00:14,720 --> 00:00:16,360 and studied more than 70 7 00:00:16,360 --> 00:00:19,040 digital transformations supported by BCG. 8 00:00:19,960 --> 00:00:21,040 The study showed that 9 00:00:21,040 --> 00:00:23,240 only 30% of digital transformation 10 00:00:23,240 --> 00:00:25,000 efforts achieve success. 11 00:00:25,480 --> 00:00:27,840 However, there are six key factors that, 12 00:00:28,280 --> 00:00:29,920 if addressed adequately, 13 00:00:29,920 --> 00:00:31,480 can flip the odds of success 14 00:00:31,480 --> 00:00:33,120 in a digital transformation 15 00:00:33,120 --> 00:00:35,320 from 30% to 80%. 16 00:00:35,480 --> 00:00:37,880 One of the six success factors 17 00:00:37,880 --> 00:00:40,120 is having a strong leadership commitment 18 00:00:40,120 --> 00:00:43,520 from the CEO all the way down through to middle management. 19 00:00:44,040 --> 00:00:45,080 Our research reveals 20 00:00:45,080 --> 00:00:47,360 that companies with a leadership commitment 21 00:00:47,360 --> 00:00:49,640 from the CEO down through middle management 22 00:00:49,640 --> 00:00:53,880 are 65% more likely to succeed in their digital transformations 23 00:00:54,000 --> 00:00:56,280 than those without such a commitment. 24 00:00:56,400 --> 00:00:57,920 Companies that met 25 00:00:57,920 --> 00:00:59,360 or exceeded their targets 26 00:00:59,360 --> 00:01:01,320 and created sustainable change 27 00:01:01,320 --> 00:01:03,240 had their CEOs checking in 28 00:01:03,360 --> 00:01:06,600 at least quarterly to track progress and steer the effort. 29 00:01:06,640 --> 00:01:09,360 Over 90% of these companies 30 00:01:09,760 --> 00:01:12,160 had digital transformation on the CEO’s 31 00:01:12,440 --> 00:01:14,000 or the Executive Committee’s agenda— 32 00:01:14,120 --> 00:01:16,160 a staggering 50% more 33 00:01:16,400 --> 00:01:18,200 than companies that were less successful 34 00:01:18,200 --> 00:01:19,400 or unsuccessful. 35 00:01:20,080 --> 00:01:22,160 In our discussions with executives 36 00:01:22,160 --> 00:01:24,440 who led successful digital transformations, 37 00:01:24,440 --> 00:01:26,600 we also learned about how they engaged 38 00:01:26,600 --> 00:01:27,800 the frozen middle. 39 00:01:28,080 --> 00:01:29,720 This refers to middle managers 40 00:01:29,720 --> 00:01:32,440 who may not buy into the transformation right away 41 00:01:32,440 --> 00:01:34,480 because their incentives are not aligned 42 00:01:34,480 --> 00:01:36,720 with the transformation goals, for example. 43 00:01:37,000 --> 00:01:39,440 So, what makes leadership committed 44 00:01:39,440 --> 00:01:41,520 and middle management engaged? 45 00:01:41,520 --> 00:01:43,960 Based on our empirical research, 46 00:01:43,960 --> 00:01:46,360 we have developed a set of Yes/ No questions 47 00:01:46,360 --> 00:01:47,280 to help you assess 48 00:01:47,280 --> 00:01:49,000 whether your organization 49 00:01:49,000 --> 00:01:50,120 can adequately address 50 00:01:50,120 --> 00:01:51,200 the leadership factor. 51 00:01:52,640 --> 00:01:53,520 And BCG 52 00:01:53,520 --> 00:01:54,720 has a structured approach 53 00:01:54,720 --> 00:01:57,480 to help you answer Yes to these defining questions 54 00:01:57,480 --> 00:02:00,120 by getting visible commitment from your CEO 55 00:02:00,120 --> 00:02:01,600 and other key executives, 56 00:02:01,600 --> 00:02:03,720 and engaging middle management. 57 00:02:04,160 --> 00:02:05,920 There are a few other considerations 58 00:02:05,920 --> 00:02:06,760 to keep in mind 59 00:02:06,760 --> 00:02:09,240 as you progress with your digital transformation effort. 60 00:02:10,080 --> 00:02:10,880 Purpose 61 00:02:10,880 --> 00:02:12,240 is what motivates people. 62 00:02:12,880 --> 00:02:14,280 Your company’s purpose 63 00:02:14,280 --> 00:02:17,280 is the North Star that inspires true commitment 64 00:02:17,400 --> 00:02:19,800 and gives employees much more than a paycheck. 65 00:02:20,480 --> 00:02:22,000 Consistent messaging 66 00:02:22,000 --> 00:02:23,400 and actions are key. 67 00:02:23,520 --> 00:02:24,480 Having leaders 68 00:02:24,480 --> 00:02:25,640 speak the same language 69 00:02:25,640 --> 00:02:27,320 to describe the transformation, 70 00:02:27,560 --> 00:02:28,280 as well as 71 00:02:28,280 --> 00:02:29,400 act on what they say, 72 00:02:29,400 --> 00:02:31,280 creates a clear vision 73 00:02:31,280 --> 00:02:32,360 of the future 74 00:02:32,360 --> 00:02:33,640 and sets the right example. 75 00:02:34,520 --> 00:02:36,440 Leaders must also rethink 76 00:02:36,440 --> 00:02:37,280 how to engage 77 00:02:37,280 --> 00:02:38,640 and create excitement 78 00:02:38,640 --> 00:02:39,960 about the transformation. 79 00:02:39,960 --> 00:02:41,840 They need to embrace large-scale 80 00:02:41,840 --> 00:02:44,120 empowering rather than traditional 81 00:02:44,120 --> 00:02:45,720 command-and-control models. 82 00:02:46,360 --> 00:02:49,360 Leaders must demonstrate compassion and care. 83 00:02:49,560 --> 00:02:51,000 Because layoffs, 84 00:02:51,000 --> 00:02:51,640 redeployments, 85 00:02:51,640 --> 00:02:53,680 and reskilling are inevitable. 86 00:02:53,680 --> 00:02:55,080 It is essential to provide 87 00:02:55,080 --> 00:02:57,200 practical and emotional support 88 00:02:57,200 --> 00:02:58,200 to those affected 89 00:02:58,200 --> 00:03:00,280 either directly or indirectly. 90 00:03:01,520 --> 00:03:02,280 Be agile 91 00:03:02,320 --> 00:03:03,000 and ready to take 92 00:03:03,000 --> 00:03:05,000 bold decisions to drive commitment. 93 00:03:05,240 --> 00:03:07,200 Be open to reassessing the change vision 94 00:03:07,200 --> 00:03:09,400 and messaging to keep them relevant, 95 00:03:09,600 --> 00:03:12,360 but willing to reevaluate the leadership team 96 00:03:12,360 --> 00:03:14,760 to ensure unanimous support for the change. 97 00:03:15,240 --> 00:03:16,920 As one of our senior clients put it: