The culture clash: the role of organisational culture in digital transformation

03 May, 2023

The success of a digital transformation project does not rest entirely on the capabilities of the technology being introduced. Like many projects, a major factor that determines success is the company culture that predates the transformation efforts.

A positive company culture that promotes innovation and embraces change and growth is more likely to support a successful transformation initiative than an organisation with a disengaged (or worse) workforce.

Even with the best intentions, the wrong culture can sink a digital transformation initiative faster than almost anything. 9Yards consultant Jennifer Baldwin says it’s not uncommon to begin exploratory work with a new client, only to discover they had already begun almost identical work in previous years, yet it’s been unsuccessful or abandoned. The systems or benefits were not appropriately conveyed to staff, or they didn’t receive the right training, or the “solution” never addressed their actual needs. “So then it’s up to us to determine what we can do differently so our strategy is usable and has a successful implementation,” she says.

9Yards consultant Tatiana Konnova adds: “You can’t just give ‘transformation’ to one group of people, or one unit in an organisation to just deal with. It’s always a horizontal problem that needs to be solved with good leadership.”

Why are team members resistant to change?

Digital transformation involves a significant shift in the way business is done, and so, it is essential that employees have the right communication, training and input to be receptive to these changes.

“Someone higher up will introduce an initiative, and it’s not necessarily wrong, but they haven’t taken their workforce into account,” says Jennifer. “And so they commission a piece of expensive work, it gets completed, and then no one ever touches it or does anything with it again because they didn’t have the right people to deliver it or push it forward or adopt it.”

What makes the “right” company culture to support digital transformation?

Hiring for cultural fit isn’t about choosing personalities that make for a comfortable time in the break room (in fact, this misguided attempt at fostering culture can actually perpetuate bias and contribute to an echo chamber of ideas where no one is willing to challenge the status quo). It’s about identifying the ability of a candidate to continually engage in their workplace, uphold company values, and contribute to a better outcome for all.

“They’ve got to hire the right people before they bring in digital transformation consultants like us, I think. And obviously it’s OK to have contractors, but it’s important to consider cultural fit even for contracts,” says Jennifer. “I think a lot of the time there’s contractors who aren’t there long-term, so they don’t necessarily have the same personal investment. They don’t feel the need to have a better solution long-term. Or they’re employees who’ve been there so long and they’re beaten down, or they can’t see how to do it differently, or they’re tired, or they might not even have the right skillset. So they don’t try because they don’t want to fail.”

That also means a healthy culture needs to be fostered from the top down, with leaders providing space for their teams to truly do their best, and take on the ideas and concerns of their staff.

“I think part of the problem is: the work comes from execs and they push it down to someone underneath them without sometimes even asking that person if they’re the person with the right skills, or if they’re interested,” says Jennifer.

It’s also important to have enough of the right people to be able to implement change. “One of the organisations I worked with had a digital suggestion box, and then they were meant to prioritise the good ideas and implement them,” says Jennifer. “But they had so few staff that they couldn’t keep up with reading the suggestions, let alone implement them. While it had potential to be a good strategy to engage people and get them excited about seeing it go forward, it ultimately fell flat.”

Why does a digital transformation project need to be clearly communicated?

Poor project communication is one of the fastest routes to resistance and distrust. “When we come in as digital transformation consultants, some people think we’re there to interview and audit everyone, and recommend redundancies, and that’s not it,” says Jen. “We’re just trying to figure out why they have challenges, not that they’re not the right person for the job.”

9Yards’ Andrew Bialek remembers working to remediate the struggling implementation of a new student administration system a few years ago. “Staff resistance can lead to major failures. The reason for this failure was trying for a very fast implementation, while there was a huge resistance to change. So the implementation was moving forward, yet the people who were supposed to use the new system were very resistant. They never accepted the change and that was ultimately the undoing of the whole exercise. “

How to engage employees ahead of (and during) a digital transformation project

As digital transformation involves the integration of various business processes and departments, collaboration is necessary to ensure that the transformation is successful. A company culture that encourages collaboration and transparency allows for better communication, sharing of ideas, and the identification of potential roadblocks. To realise this in a workplace:

  • ensure multiple layers of communication of the larger context and implementation progress
  • provide appropriate education and training with the introduction of new procedures and programs
  • encourage – and implement – feedback from your workforce.

Andrew also advocates for peer-advocacy of the initiative. “So you need to build it from the top down, but at the same time you need to build a network of champions of change. These champions understand and lead part of the change to support the new way of working.”

Connect with 9Yards Consultants

Ready to start the discussion on what digital transformation would look like in your organisation? Get in touch to arrange a complimentary initial consultation with our expert consultants.