How Leadership Can Accelerate the Automation Agenda

By Ray Cheung, Partner, Consulting & Brian Hochberg, Crowe

March 17, 2021 Technology

Digital transformation — using technology to fundamentally improve an organization’s business processes, culture and customer experiences — has become a prominent discussion topic in boardrooms and executive suites throughout all types of companies. Although digital transformation is often regarded as an inherently technical challenge, directors and senior executives have critical roles to play in leading the effort.

The accelerating pace of digital transformation
Digital transformation has been underway for many years, but the Covid-19 pandemic is accelerating the process for many companies and industries. Experiences such as online banking and shopping, telehealth conferencing and appointments, remote software development teams and virtual meetings already were growing in popularity, but the pandemic has made these the necessary ways of doing business. In some cases, these changes likely are permanent.

Today, most executive teams recognize the risk of being left behind and are eager to adopt new digital strategies. For example, the executive leadership at one large telecommunications company issued a top-down mandate that employees actively look for ways to automate parts of their jobs. If they couldn’t embrace automation, they were in the wrong company.

For most organizations, the challenge now is how to move toward the ultimate objective of establishing themselves as digital leaders while transitioning in a way that is practical, achievable and cost-effective for both the near and long terms.

Making digital transformation effective
One key benefit of many technology investments is the ability to achieve a positive return on investment (ROI) in a relatively short time. But a genuinely transformative digital initiative can produce benefits that go beyond the immediate ROI, enabling both quantitative and qualitative improvements in the operation. These benefits might include an enhanced customer experience, access to new markets, greater employee satisfaction, better use of assets and faster, more responsive decision-making, among others.

The ability to achieve these wider-ranging benefits often depends on how board members and executives approach the effort. To succeed — and to set their organizations apart as leaders rather than followers in the field — directors and senior leaders must take on active roles and understand both the necessity and nature of their digital transformation initiatives.

Critical success factors
Most successful digital transformation efforts share several important features. Boards and senior leadership are positioned to directly affect these characteristics, which include the following:

  • Strategic alignment. A critical early step is to align the digital transformation effort with the company’s broader, overall strategy. Leadership should outline the specific business outcomes that transformation is intended to achieve, then link those to relevant strategic objectives.
  • Measurable results. Boards should require their executive and technology teams to establish quantifiable metrics to evaluate the success of each component of the transformation effort. As noted earlier, initial ROI or productivity improvements are only part of the picture.
  • Senior leadership should provide visible support and establish clear lines of responsibility. Digital transformation efforts should be led by a senior leader with a dedicated budget, clear lines of reporting and public responsibility for its management and direction.
  • A culture of automation. Boards and senior leaders should create a culture that embraces automation rather than resisting it. Even tech sector companies that visibly endorse innovation don’t take success for granted. Creating a culture of automation requires consistent messaging that communicates the advantages and benefits, such as greater opportunities and more rewarding work experiences.
  • Technology toolbox. Digital technology is constantly and rapidly evolving and converging, so staying up to date and informed is essential, even at the board level. At a minimum, senior leaders should understand the basic concepts and capabilities of process automation and management, artificial intelligence, machine learning, process mining, analytics, advanced voice and optical character recognition and other emerging tools that are standard components of today’s technology toolbox. By orchestrating and layering various technologies, leaders can help drive the desired business outcomes.
  • Risk, change management, and governance. The benefits of digital transformation are numerous, but leaders also must recognize the potential risks and organizational changes that are involved and put in place the necessary risk and change management tools as well as governance structures to mitigate them. In addition to cybersecurity, privacy and compliance concerns, less obvious risks such as system integration challenges and system architecture shortcomings could trigger additional expenditures.

As recent history demonstrates, the leading companies of tomorrow will be those that successfully embrace change today. In this environment, digital transformation is both essential and, ultimately, beneficial. Boards and executives can take the lead in helping to plan, finance, implement and improve their organizations’ transformation efforts.