Digital transformation can be complicated, especially for global consumer packaged goods companies with extensive supply chains. The purpose of digital transformation is far-reaching. It brings about a paradigm shift in how your company operates while focusing on customer experience, increasing revenue and growth opportunities, and future-proofing your business.
Yet, a study by Bain and Company reveals nearly 95% of digital transformations fail or do not achieve the desired goals. Why do so many digital transformations fail? Is it because of a lack of the right tools or expertise? Digital transformation is not just about implementing the right tools and technologies. Instead, it’s about changing the way your people work.
CPG consulting teams suggest a three-stage iterative approach to orchestrate successful digital transformations:
#1: Diagnose & Design
Before you begin the digital transformation process, you need to have an accurate snapshot of the company’s current capabilities and status quo:
- What are the strengths and weaknesses of the brand?
- What needs to be changed to make the company digital-first?
- Are existing structures, technologies, processes, and capabilities designed for a digital world?
Answering these questions lays the groundwork for a new digital operating model. It is essential to leverage the expertise of software consulting companies, business consultants, and financial consultants to get multiple inputs and build a cohesive approach for the new operating model.
The goal of this stage is to give CPG companies a clear picture on how to proceed with the digital transformation and a better understanding of the future organizational structure and processes. This stage also helps you identify the required employee skills and work culture to adapt to the new digital operating model.
#2: Implement a top-down approach
Once you have built the plan for digital transformation, you need to ensure that the CPG consulting team designs a “top-down” vision, from senior management to the grassroots level. Ensure that the digital transformation roadmap involves all business functions, markets, regions, and products for an efficient, cohesive approach. During this stage, you must also identify and monitor the systems that will drive the transition.
#3: Implement iteratively & monitor consistently
This stage involves preparations to implement the digital transformation plan at all levels of your organization. Success depends on how efficiently you execute the process, consistently build your digital capabilities, and regularly monitor progress. Expert CPG consulting teams suggest tracking four key parameters to determine the success of your digital transformation:
- Assign optimal staff roles: The success or failure of your digital transformation relies heavily on how your employees realign themselves to the new approach. Undergo a quantitative assessment of each employee role and assign the right people for the right task.
- Establish robust project management: Successful digital transformation programs require expert software consulting companies and well-established leadership structures. Your employees should be the driving force on the ground, while your senior management and project managers should be the backbone of the project, tracking and monitoring the execution.
- Keep the change simple: Simpler digital transformation models with clean execution and continuous adjustments have a higher chance of success. So, work with your CPG consulting team to design future operating models that are simple to execute.
- Go for a consumer-first approach: As a CPG brand, consumers are your biggest strength. Use big data analysis to accurately identify your customer’s needs and tailor your operating model to meet and exceed their expectations.
Keep the digital transformation agile & holistic for the best results
Digital transformations are a massive undertaking involving multiple phases of analysis, planning, and execution. An agile approach helps you tailor theoretical models to match real-world conditions. It helps you develop, implement, review and continually improve your strategies for the best results. Avoid short-term piecemeal solutions that waste excessive resources. Instead, think holistically and work on building a strong organizational culture that meets future requirements.
