The pace of change within organizations is accelerating rapidly. And yet when it comes to successful digital transformation, the large majority of companies find themselves stuck.
According to a McKinsey study, over 80 percent of executives say their companies’ digital transformation plans are failing. Employees are overwhelmed. They regularly hit points of friction when they use software at work. And they don’t think managers are doing enough to support them. These challenges only get bigger in the public sector, where regulation around what agencies can and cannot do adds yet another barrier to digital transformation.
But there is a way forward. To better understand how government and heavily regulated industries can adapt to the digital future, Tatyana Mamut (senior vice president of new products at Pendo) spoke with Chris Taylor (enterprise technology and product strategy director at Grant Thornton) at Pendomonium, Pendo’s annual product festival.
Innovation finds a way
The good news, said Taylor, is that despite the heavy regulation around government that often hinders change, agencies are taking steps to become more innovative around technology. “Some government agencies are interested in setting up what we’re calling a digital or innovation lab,” he explained, similar in nature to the startup accelerator YCombinator. Taylor heads up one such lab for a government agency, and said that other departments have started showing interest in setting up their own versions of it.
Still other agencies are considering ways to use emerging technology to improve the user experience—and save money in the process. One is the IRS. “What they’re looking at,” Taylor said, “are things like AI, machine learning, augmented reality—ways that you can take and get information about the needs we all may have as citizens without having to pick up the phone and call people. Every time they call, it costs taxpayers money.”
Leverage data to reduce risk and put facts first
Part of the digital transformation challenge unique to the public sector has to do with motivation. Strict regulations mean that “the ability to innovate and drive change could be very slow because the incentive is for minimal risk, not necessarily new innovation,” Taylor said.
The good news is that there’s a way around this problem: data. The right organizational insights not only shine a light on user wants and needs, they help determine what the right course of action is, thereby reducing both risk and the time it takes to implement change. Bringing data into the mix makes the conversation about facts, not opinions. “If you can use data to identify where the risk is,” Taylor noted, “that can increase confidence and accelerate decisions going forward.” It also better ensures that the right funding goes to fixing the right pain point or area of friction.
Put the user at the center of your strategy
Despite these many promising developments in the public sector, the reality is that most digital transformation plans still fail. Reflecting on why this happens, Taylor argued that too many companies and agencies have historically approached the issue from the wrong perspective—i.e., not the user’s.
“There’s not a clear understanding of who the customer is at the very beginning,” he warned. Without a coherent picture of the user at the outset, technological change won’t solve the problems managers intend them to, and may even make them worse in some cases. “There’s not enough work on the front end to make sure that what’s built, customized, and implemented is tailored to solving the problems that [users] have.”
Taylor ultimately saw the high failure rate as an opportunity. “The opportunity is to put customers and employees at the center,” he concluded. Only once that approach takes hold will more digital transformations succeed.
Learn more about Pendo Adopt and how it can help bring about successful digital transformation here.