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Tips to Help Business Leaders Succeed in an Age of Digital Disruption

 


With digital transformation in the business world accelerating since the COVID-19 pandemic began, many companies are in danger of being left behind – possibly for good.

The numbers can be disheartening.

“Even after spending enormous amounts of effort and capital on digitalization, more than 90 percent of organizations fail or show poor results in adjusting to the rapidly changing business environment,” says Sri Manchala, the ForbesBooks author of Crossing the Digital Fault Line: 10 Rules of Highly Successful Leaders in Digitalization (www.digitalfaultline.com).

Trianz, a highly specialized digital transformation services firm that Manchala heads, made that unsettling discovery after researching 5,000 small, medium and large companies across 18 industries worldwide. 

News about the future doesn’t get much better as they pore into the data.

“Our analysis predicts that more than 30 percent of companies will cease to exist by the end of this decade – a trend that will only speed up in the coming years,” Manchala says. 

He’s not the only one measuring digital transformation and its impact.

A survey published by Statista shows that companies across numerous industries report that digital transformation sped up in their organizations as the pandemic changed business and market requirements for both employees and customers. In the finance industry, 60 percent of companies said digital transformation had sped up “a great deal.” In retail and ecommerce that was 70 percent, in healthcare it was 74 percent, and in energy it was 77 percent, just to offer a few examples.

“No business is immune to these dramatic, foundational, and deeply intertwined shifts,” Manchala says.

Businesses that fail to adapt usually do so not because of lack of effort but because they place their emphasis in the wrong areas, Manchala says. A few of the many steps they can take toward a true and successful digital transformation include:

• Focus more on customers than on competitors. Ever-increasing choices of personal computers, mobile phones, gaming devices, and digital content are all affecting consumer behavior. But some companies become so preoccupied with what their competitors are doing that they fail to notice those changes in consumer habits until it is too late, according to Manchala. That happened more than a decade ago with many retailers who were slow to adjust to online shopping and allowed Amazon to undermine them. “Certainly, you can’t completely ignore competitors,” he says. “But it’s essential to continuously understand your own customers; to launch new products, services and experiences; and to track sales, satisfaction, and brand loyalty data.”

• Replace assumptions with data analysis. Many business leaders base decisions on assumptions or prior experience, collecting data only when absolutely necessary, Manchala says. “This is an approach that will always fall short,” he says. “By the time these leaders collect and look at data, the landscape has shifted, making any strategies developed from the data obsolete. For strategy to be truly effective in the Digital Age, it must be highly adaptive to change.” The good news, he says, is that these days data is being created continuously, and it provides important clues about trends – but only for those who make it a point to keep up with the latest information.

• Disrupt yourself before high-tech does it for you. Over the past decade, the high-tech industry has steadily encroached on other industries. Tesla turned the automotive industry upside down. Uber and Lyft reinvented the taxi business. “Traditional and established companies in every industry are finding it hard to counter high-tech’s drive,” Manchala says. “But those companies must move out of their comfort zones, think beyond cash cows of the past, and embrace the process of disrupting themselves. They need to focus even more on customers, retaining them as best they can while freeing up as much capital as possible for reinventing products and services with embedded technology.”

“It’s important to understand that digital transformation is about continuous change, and what represents success today will be obsolete tomorrow,” Manchala says. “There is no finish line for winners. Companies that cannot visualize a new future and do not let go of outdated products, services, and business models will be ignored by customers. Those unwilling to adapt to new cultures and ways of doing things will perish.”

 

About Sri Manchala

Sri Manchala, the ForbesBooks author of Crossing the Digital Fault Line: 10 Rules of Highly Successful Leaders in Digitalization (www.digitalfaultline.com), is the CEO of Trianz (www.trianz.com/ ), a highly specialized digital-transformation services firm headquartered in Silicon Valley and serving clients globally. Manchala shares data-driven insights on transformations and adaptive business leadership based on his two and a half decades in the technology industry, and leadership experience in the military and as a CEO. Manchala is a graduate of the National Defense Academy, an elite training academy for India’s Armed Forces officers, where he served in the infantry and Parachute Regiment (Special Forces). He is also an alumnus of the Marshall School of Business at the University of Southern California, where he is now a corporate advisory board member.

 

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