The excitement around artificial intelligence (AI) and digital transformation can lead to the belief that success lies in adding more features – especially if they are sophisticated. It’s natural to be drawn by the latest tools, templates and workflows that promise our teams greater efficiency.
However, they can also introduce unnecessary complexity. When transformation efforts don’t go as planned, organizations tend to react by layering on even more outdated ineffeciences, expecting that all the sophistication will help to simplify the process.
Digital transformation is entangled in complexity
Digital transformation is about modernizing technology in companies. Its evolution would suggest that its more about simplification. The shift from horse-drawn carriages to cars was a solution that simplified transportation for users. This technological leap didn’t just introduce a faster way to travel, it made it easier to go from one physical location to another. Similarly, moving from paper questionnaires to online platforms for data collection. Today, we can respond without writing at all. A simple swipe on a smartphone will record your response.
Despite digital transformation ultimately being about simplification, it’s still entangled in complexity. It’s common to see a plan becom more complex as it evolves. As a transformation leader, you may have heard frustrated teams say “It’s just too complicated!” and investors remark, “behind schedule? It was just one feature!”
Digital transformation attracts complexity because of the chain of decisions that occur over time. Every time a solution isn’t available, a new one is created – sometimes in the form of yet another spreadsheet. Complexity creeps in quietly and builds over time, making the original vision harder to achieve.
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What can we remove to make this work better?
Leaders that created the famous “one page plan” will recognize that complexity will soon follow. After a few weeks, or months, the project that began as a well-structured initiative can soon spiral into a tangled web of dependencies, changing requirements and unanticipated challenges.
True transformation isn’t about layering on more features and adding to the mess; it’s about stripping away the unnecessary. Instead of asking “what more can we add?” organizations should be asking “what can we remove to make this work better?”
Revlon is a example of a company boggled down by complexity during its most publicized transformations. After merging with Elizabeth Arden in 2016, their attempt to integrate its enterprise resource planning (ERP) processes had come to a stop. They tried to consolidate Microsoft and Oracle systems into a unified SAP system, but rushed the implementation without ensuring any of these systems were compatible.
When the new ERP system went live in 2018, operations came to a halt, leading to a $64 million loss in sales and an investor lawsuit. The project crashed even though Cover Oregon implemented changes in iterative steps. The failure wasn’t due to a lack of technology – it was due to an overcomplicated implementation strategy.
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Just because you can, doesn’t mean you should
As much as companies want to emulate the innovativeness of Apple or Google, understanding context is just as important as being ambitious.
In 2012, Cover Oregon, an online health insurance marketplace, undertook a first-of-a-kind digital transformation. It was implementing Obamacare into its services while replacing all the transaction processing systems that supported it. Amidst issues with the site, the initiative ballooned into an unexpected $300 million project that ultimately failed to process a single insurance application through the exchange.
One report noted the “aggressive timelines” and categorized 108 risks within the transformation project itself. The case of Cover Oregon provides a useful lesson: just because something can be done, doesn’t mean it should be. Ironically, digital transformation was meant to simplify the process and yet, its implementation introduced complexity that killed it. The overwhelming scale of decisions paralyzed the team, and the project collapsed by an endless “to-do” list.
We like to think that change will always represent an advancement in technology. However, that’s not always the case. At times, vendors phase out software features for new deployments, introducing features that were never part of the initial plan.
Other times, one will find that acquisitions and new growth strategies can lead to platform overhauls. The slightest change to software settings can unfortunately stop operations. Transformation leaders should focus on core functionalities first and only introduce additional features if they provide significant value without complicating usability.
A great strategy finds a way to simplify the process
Any transformation strategy should be about making processes easier, not harder. Organizations that succeed in transformation intiatives are those that recognize the value of simplicity. It’s not about adding more tools, templates or the hundreds of Excel spreadsheets used as band-aids. It’s about ensuring the ones you do use work and are sustainable.
The core functionality should be the primary consideration when selecting and implementing new tools. Leaders should begin with complexity as a starting point. They should recognize that complexity will always be part of the equation, but a great strategy will help them simplify it.
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