You cannot afford to ignore the importance of digital innovation and how digital technologies can change a business model and thus, provide new streams of revenue and value-creation opportunities. It has been widely recognized that most service companies frame & propose digital transformation solutions that are typically tailored, keeping in mind their fixed-line business solutions, rather than the business imperatives of customer organizations. Executives and board members should have a deeper engagement with the industry specialists to get an unbiased perspective on how digital can transform their businesses. One of the ways is to launch a platform for external independent advisors when you would want to seek an independent, unbiased perspective on the solutions provided by your mainstream vendors. 

However, you would need to start the transformation campaign internally, in your organization, with your own resources. In this campaign, you can make use of play internally to make a significant contribution to developing the vision for Digital Transformation. Games can be played within the organization to get insights on Why Transformation, What to Transform and How to Transform?

Since DT initiatives have significant lessons from failures as well as from successes, we will see a few cases of failures below.

Failure of GE

GE’s group-wide foray into Digital Transformation started to converge when they set up a new business unit called GE Digital. GE has put a significant investment in adding sensors to all the products; it transformed its business models by building a sophisticated IoT platform. They had put billions of dollars into their digital business and fell into a trap by reporting earnings to the shareholders. The company’s stock price dropped significantly, and CEO John Flannery had to step down. What went wrong was that they were focusing on quantity rather than quality. GE’s transformation approach was a Big Bang strategy. For a mega-corporation like GE, this approach was internally disruptive, but it negatively impacted their main revenue streams.

Failure of Ford

Ford faced a similar experience in its quest for Digital Transformation. To build digitally connected cars, Ford created a new entity called Ford Smart Mobility. But, despite Ford’s significant investments in this new venture, stock price plunged, and Ford CEO had to step down. 

What we can learn from the failure of GE & Ford is that generally, when it comes to digitization, the focus is on business lines with higher market share. Still, from the transformation perspective, the focus needs to be on the products which bring exponential growth in value to the end-users irrespective of their market share. Only launching a digital business as a separate entity may not be a panacea for effective transformation in parent organizations. What we need to learn from these stories is that digital transformation needs to be integrated into the company. It should not consist of an individual assessment but the group assessment (a fair process). This process could have a higher chance of success if innovative and engaging methodologies like play are used in these initiatives.

Your organization’s transformation could mainly be because of the competitive, disruptive forces which have the potential to destroy your business ecosystem. So, to get the answer to the Why Transform question in more detail, you can collaboratively explore simulations in which you and your employees find fault lines that can destroy your business before your competitors can do so in the real world.