Regardless of industry, business leaders are facing the same massive challenges, including economic uncertainty, the impact of climate and sustainability on their operations, regulatory requirements, keeping costs down, and retaining and developing talent. More than ever, leaders need to engage in digital transformation projects that drive the greatest value. 

I read a sobering statistic from McKinsey Consulting that 70% of digital transformation projects fail to meet their goals, largely due to employee resistance and lack of management support. It led me on a quest to interview leaders across private and public sector industries to better understand why some organizations that deploy technology to transform their business operations get it right—and why so many others don’t.  

Organizations that leverage digital transformation projects to unlock value quickly and drive the greatest impact on improving business operations use a common set of winning strategies throughout their technology engagement, according to an experienced team of industry and public sector leaders. Those who get it right quickly follow several themes that I’ll highlight in this post.

Eight strategies emerged as key to successful technology transformations. In the first of a three-part series, I’ll describe the first set of strategies.  

Strategy #1: Identify leaders who embrace the necessary mindset 

Identifying and selecting the right individual to lead your technology transformation involves looking for several important characteristics, according to those I interviewed. They are the people who have the vision, commitment, influence and drive to bring the change necessary that inspires others. Whether it’s the Chief Financial Officer, the Chief Procurement Officer, the Vice President of Operations or other C-Suite leaders, these leaders need a combination of soft and hard skills and other personal attributes to get the job done.  

To guide your selection, we recommend you consider the following skills:  

  • They embrace change and do so with a healthy dose of positivity. These leaders are not fearful or resistant to change, but rather remain open to the potential that change can unlock. We work with procurement and operations leaders who are frustrated with manual, paper-based processes and are open about a move to procurement technology to increase employee productivity by automating those previously manual processes. We’ve worked with leaders who have implemented procurement technologies but were not happy with the user experience and/or cost and embraced the move to find another solution despite the potential disruption. They didn’t resist the change – they embraced it – because they understood the positive, long-term impact. They are relentlessly optimistic knowing there will always be bumps in the road with any technology rollout. Successful leaders can discern a bug from a catastrophic failure and see that it is resolved quickly and turn any snag in the road into a learning.   
  • They are long-term, strategic thinkers who understand the potential of a technology initiative to transform their operations. They often become partners to their technology providers to ensure that the solution evolves with their needs and with long-term vision. Embedding a successful implementation into one’s performance goals elevates the project to a more strategic level beyond a transactional one. 
  • They have a strong sense of ownership and want to be active along every step of the process. They are not required to be in every discussion, but they are there and visible at the right moments. These leaders are engaged in the early discussions to share their vision and priorities, make strategic decisions—such as which of their suppliers and Varis suppliers will become part of their purchasing platform—and articulate the vision and rationale for any change.  

Strategy #2: Think of employees as customers

It’s challenging to digitally transform and drive technology change without creating a strong employee experience. Although rooted in technology, digital transformation thrives in a culture that supports it, in the hands of people who execute it, and not just in the mind of business leaders who envision it. The journey of a digital procurement transformation starts with the employee, who shouldn’t be an afterthought.  

There are a number of ways to engage your employees from the start to focus on their experience. They include: 

  • Ask employees, the end users, about their challenges. During my time overseeing acquisition policy in the federal government, we leveraged a group of frontline acquisition professionals, from contracting officers to program managers (referred to as “the Frontline Forum”), who provided feedback to us on their day-to-day challenges, how policies were actually implemented, and best practices. We’ve seen Chief Procurement Officers have similar groups that help them keep their finger on the pulse of any pain-point. 
  • Don’t make assumptions, and don’t just ask managers.  
  • Observe the entire process, end-to-end. Observe and participate in the entire user experience, in collaboration with your end users. This is sometimes referred to as “walking the store.” Doing this gives you important insights into how the user experience is happening versus how you think it is happening.   

Real world example: Early testing creates opportunity to bring in end users for frontline feedback

At Varis, we quickly set up a testing environment for our new customers before launch, inviting the executive sponsor to not only experience the platform first-hand, but to bring in a sampling of end user buyers to experience the entire workflow end to end before launch. Throughout the process the executive sponsor remains engaged on feedback from users about ease of use, whether the products are displayed clearly, the speed of the search, whether it does what it says it’s going to do, the language is clear.

The executive sponsor will walk through the entire purchasing experience from end-to-end and evaluate for ease of use, consistency and speed.

Strategy #3: Treat your technology initiative as a continuous improvement project  

Think of technology as an enabler that will allow the organization to progress, scale and flex in line with future goals. Continue to monitor, evaluate and learn to make sure the changes you’re making are having the impact that you want and need.

How to avoid the “set and forget” mentality: 

  • Create milestones and build in time for adjustments.  
  • Document, show and celebrate progress. Sharing in success is super important—every step of the way. 
  • Keep analyzing your current processes. What can be improved? Which processes aren’t properly aligned with our broader organizational objectives? By constantly asking these questions, you are always planning how to make improvements. 
  • Make changes in close consultation with the end users directly involved. They are often responsible for implementing the improvements. Create mechanisms for feedback, both from buyers and suppliers, through surveys, councils and forums.  
  • Think about where you can standardize. Customizing processes by department, office or business area drive inefficiencies and are super hard to maintain. Set a goal to drive savings by increasing use of one of your approved compliant contracts. But you also want to drive savings by to get the most competitive pricing. 

Real world example: Finding savings after implementation

A manufacturer started working with Varis and loaded five of their existing suppliers’ catalogs into the platform. When contracts were being renewed, the CPO of this manufacturer asked Varis to do a market basket analysis on office supplies, janitorial and sanitation, maintenance repair and IT categories.

When the market basket analysis revealed a 10% cost saving in each category, Varis was able to upload the new supplier catalog into their platform and remove the existing supplier. End user buyers did not notice a change in brands or product quality, and the manufacturer saved 10% on categories they were already buying.

The procurement improvements you identified should be implemented preferably in consultation with the people directly involved or impacted. These include senior and middle management, departmental staff, suppliers and customers.

Share your story with me on LinkedIn about how your organization digitally transformed. Would you consider a digital procurement transformation?