Product School

Unlocking Success in Product-Driven Digital Transformations

Carlos headshot

Carlos González De Villaumbrosia

September 22, 2023 - 12 min read

Updated: May 6, 2024 - 12 min read

Pivoting to a product-driven digital transformation can be a challenge.  In an era where digital solutions are redefining industries, many companies are transitioning their strategies to harness the potential of these innovations or to remain competitive. 

Blog image 1: AI-driven product

Recent surveys on product-driven digital transformations indicate that a significant majority of organizations have embarked on this journey in recent years. However, embarking doesn't always mean succeeding. Previous studies suggest that a mere fraction of these transitions truly enhance an organization's performance in a lasting manner. The success rate is even slimmer when specifically focusing on digital shifts.

However, there's hope. There are pivotal practices, each contributing to a higher likelihood of a fruitful transition, that resonate across five key themes and we are here to tell you all about them.

In this post, we’re going to explore each of these practices and provide you with a guide to refine your product-centric digital strategies.

The rocky road of digital evolution

Let's be real for a moment: embarking on transformation is tough. And when we talk about digital transformations, the going gets even tougher. Decades of research echo a consistent message - a very low percentage of transformations cross the finish line victoriously

Blog image 2: AI-driven Product

And here's a surprise – sectors we perceive as digital forerunners, such as tech, media, and telecom, are also grappling. The narrative becomes even more messier for industries deeply rooted in tradition. Think oil, cars, infrastructure, and pharmaceuticals, whose success in digital transformations is almost nonexistent. 

Size, it appears, does matter. If your organization is on the smaller side, with fewer than 100 team members, there's some good news. Professionals from these smaller settings feel significantly more positive about their digital transformation outcomes compared to those in vast organizations with over 50,000 employees.

So, as you stand on the verge of this digital transformation, know that the path is going to be full of challenges.

The blueprint of digital product transformations

Take a closer look into product-driven digital transformations and you'll spot some patterns. It's not just about giving your product a digital facelift or integrating the latest tech. 

Primarily, when organizations embark on this transformative journey, they often focus on internal refurbishments. Most of these emphasize reinventing their product's digital backbone is key. 

Blog image 3: AI-driven Product

In contrast, fewer venture into unknown territories, like launching entirely new digital products or going for dynamic digital partnerships. The breadth of these transformations is often vast, with the majority encompassing multiple facets of the organization – be it different teams or even the entire product suite.

Now, let’s talk tech. On average, organizations juggle around four or five tech tools that can truly harness their transformation. And yes, while classic web tools reign supreme, there’s a common tendency to underestimate the clout of emerging technologies, which can make a total difference.

A closer look at the champions of digital product transformation yields an interesting observation. They aren’t shy about their tech arsenal. It might seem like a recipe for chaos – more technologies equating to a complex transformation panorama. But here's the twist: these frontrunners lean heavily into advanced tech realms, be it AI, IoT, or cutting-edge ML.

For instance, consider the transformation of Spotify, which adopted AI not just for their song recommendation algorithms but also to analyze user behavior and improve their product features. This allowed them to tailor user experiences at an individual level, resulting in highly personalized playlists like "Discover Weekly" and "Release Radar". While managing multiple advanced technologies could have been overwhelming, Spotify's focus on user-centric product development allowed them to harness this tech blend effectively and maintain their position at the forefront of the music streaming industry.

A guide to succeed in a product-driven scenario

Understanding the intersection of technology and product strategy is a MUST. While possessing the latest tools and technologies is undeniably important, knowing how to implement them effectively is what truly sets successful digital transformations apart.

Blog image 4: AI-driven product

Let's deep dive into what truly differentiates the leaders from the followers in product-driven digital transformations:

The digital workforce of tomorrow

Building a product isn't a one-person job. It requires an entire team, and that team needs to have the right capabilities. Investing in training, development, and continuous learning to ensure your team is always ahead of the curve is key. Make sure you tick all the boxes below to shape the next-generation workforce:

Invest in talent development (now more than ever!)

Embracing the digital revolution is more than just about software, tools, or platforms. It's fundamentally about people. Just like a product thrives on user feedback, organizations thrive when their teams are aligned with digital objectives. Honing talent and skills is critical for a triumphant digital change.

Invest in digital talent specifically

Organizations that strategically invest in hiring digital talent are reaping the rewards. A threefold increase in transformational success is seen when the investment in talent is spot-on.

Reinvent the recruitment wheel

Just as product management is all about innovation, so is recruitment in digital transformation. Gone are the days of traditional job postings. Today's talent is attracted to innovation—be it through unique recruitment campaigns, gamified hiring processes, or tech-centric events like hackathons. These modern tactics aren't just trends; they’re game-changers that double the chances of a successful transformation.

Bridge the old and new: The rise of integrators and innovation managers

Digitalization brings its own set of challenges, especially when reconciling the digital with the traditional. Enter integrators and technology-innovation managers into your product teams. These are the champions who serve as conduits between old practices and new innovations.

  • Integrators: You can picture them as bilingual experts. They understand the language of traditional business practices and also the nuances of new-age digital strategies. Their role? To merge the best of both worlds, ensuring a smooth transformational journey.

  • Technology-Innovation Managers: With their deep technical expertise, they're the torchbearers of digital innovations within a company. They're not just technologists, but visionaries who see the potential of every digital product opportunity.

Align roles with the digital vision

For a digital transformation to succeed, individuals' roles must mirror the transformational goals. When you clearly define and adjust responsibilities with a digital-first lens, success is no longer a distant dream but a tangible outcome. 

Think BIG, plan BIGGER

When you're plotting the roadmap for your next big product feature, you think of scalability. Similarly, scaling workforce planning and talent development is crucial. Companies that have cross-functional or even enterprise-wide hiring goals, specifically tailored to skill needs, are witnessing a higher success rate in transformations. 

Digital-savvy leadership

It's not just about having leaders; it's about having leaders who truly understand the digital landscape. Leaders who understand technological trends, and drive digital innovation are at the heart of every successful product team.

Blog image 5: Ai-driven product

How can you promote this type of leadership? Here are some of the things your company will need to do…

Choose the right leadership

During digital transformation, a notable shift often occurs within the leadership ranks of most organizations. These changes, predominantly at the top, are strategic decisions to bring onboard leadership that possesses deep expertise in digital technologies.

However, mere leadership changes aren't enough. What truly makes a difference is the presence of a leader who embodies digital acumen. Such a leader doesn't just have expertise; they also possess the vision, insights, and foresight to anticipate digital trends and guide the organization effectively through the transformation.

Engage transformation-specific roles

Having dedicated leaders, those who breathe and live the transformation can be a game-changer. Whether they're spearheading individual initiatives or leading the transformation office, their undivided attention to the change effort often spells success.

Make commitment a non-negotiable skill

Success stories aren't just about skills, but also about involvement. When key players, from senior leadership to those in transformation-centric roles, display heightened commitment—especially more than previous change initiatives—the odds of a triumphant transformation increase manifold.

Bonus Tip: Add a  Chief Digital Officer (CDO) to your leadership team

Not all organizations have adopted the role of a CDO in their transformation process. However, those who have integrated a CDO into their leadership often find greater success in their digital transformation efforts. 

A prime example of this is General Electric (GE). When GE brought on a CDO, they accelerated their digital transition, particularly in their industrial and software applications, leading to enhanced operational efficiency and opening up new revenue streams. 

Empowerment is the new management

Traditional hierarchical setups? They're a thing of the past. Modern product team thrives on empowerment. Allow your teams to experiment, to fail, and most importantly, to learn. Give them the autonomy to make decisions, and watch innovation thrive. Here are some ways you can  promote empowerment:

Blog image 6: AI-drive product

Redefine the culture of work

Digital transformation is a holistic shift—a cultural change that reshapes how teams think, interact, and deliver value.  To do so, you’ll need to scale the spirit of innovation across your entire organization and redefine your working culture to fit this new scenario.

Reinforce fluidity with concrete mechanisms 

Just as you ensure that every feature release is backed by a solid framework, successful digital transformations lean on well-established practices. Introducing new ways of working—whether it's continuous learning or adopting open work environments—can act as the scaffolding that supports this transformative journey.

Let the people navigating this change drive it. When employees ideate and pinpoint areas ripe for digitization, transformations don't just happen—they thrive. 

Get buy-in from key players

User buy-in can make or break your feature. Similarly, for transformative efforts, buy-in from key players is indispensable. This isn't just about nodding in agreement—it's about actively challenging the status quo.

  • Challenge to change: When senior leaders and transformation-focused individuals encourage teams to question the 'as-is', success rates surge. 

  • Embracing risk as a catalyst: Just as you'd iterate on a product feature based on user feedback, fostering a culture where teams aren't afraid to experiment can be game-changing. When both top brass and transformation-focused leaders cheer on experimentation—be it through rapid prototyping or learning from missteps—the likelihood of success amplifies.

  • Achieve cross-functional collaboration: The same way silos can stifle innovation, it has the same holds for transformations. If senior leaders and key transformational figures are fostering collaborations across departments, the chances of success are greater.

The digital tool revolution

You can't build a state-of-the-art product with outdated tools. Whether it's the software you use for product roadmapping or the platforms for user feedback collection, ensure you're using the best. These everyday tools can significantly boost productivity, improve accuracy, and foster innovation.

Blog image 7: AI-driven product

Here’s how you can leverage  your product game with digital tools:

Level up with accessible information

Embedding digital tools that make information seamlessly accessible across the organization, you won’t just be streamlining processes; you'll be turbocharging the odds of a successful transformation.

Use  self-serve technologies: The new power players

Integrating digital self-serve technologies for employees and business partners means handing them the reins of empowerment. This isn't just about convenience; it's about autonomy and efficiency. Implement this, and your transformation journey stands twice the chance of hitting the bullseye.

Make sure standard operating procedures meet tech

Think of this as the ‘terms and conditions’ of your organizational machinery. When you tweak these standard operating procedures to include new technologies, it's like upgrading the very DNA of your operations.

Integrate data into your decision-making

Bolstering data-centric decision-making and visibly integrating interactive tools into daily workflows, increases the odds of transformation success.

Connection is always key

It's not just about frequency; it's about quality and medium. Use both traditional and digital channels to keep your team in the loop. From regular stand-ups and sprint reviews to using collaborative digital platforms, ensure everyone is on the same page.

Blog image 8: Ai-driven product

During a digital transformation, the "why" behind every "what" needs to be articulated. Crafting a compelling change story isn’t just about ticking off a checklist; it’s about painting a vivid picture of the future. Where are you headed? Why this new direction? Why should anyone be on board? Answering these effectively can skyrocket the likelihood of your transformation's success.

Follow these tips to foster good communication during digital transformations:

Go beyond the basics in your transformation story

While outlining the transformation journey is essential, the difference between a good narrative and a great one often lies in the details. The best narratives? They don't just float lofty ideas. They anchor them with clear performance targets and precise timelines, offering clarity and a roadmap, not just a vision.

Make the sense of urgency visible 

You know how pivotal those moments are when a product release is around the corner, and the team needs to rally. Your senior leaders play a similar role in a digital transformation. Fostering a palpable sense of urgency doesn’t mean you’re just speeding up processes; it’s meant to ignite passion. This isn’t about hurrying; it’s about instilling purpose, where every team member feels the pull of the goal, and good communication lies at its heart.

Embrace the digital in digital transformation communications

While face-to-face communication has its charm, let’s face it: the digital realm is where the magic's happening. Want to amplify the reach and impact of your transformation vision? Dive into the variety of digital channels at your disposal. From webinars to digital town halls, there's a smorgasbord of tools waiting to be leveraged.

Key takeaways for success in product-driven transformations

  1. Embrace a digital-first leadership: Champion a mindset where digital innovation is at the forefront.

  2. Prioritize continuous learning: Invest in ongoing training and skill development.

  3. Celebrate failures as lessons: Create a culture that sees setbacks as growth opportunities.

  4. Equip with the best tools: Ensure your team has the top industry tools at their disposal.

  5. Combine communication channels: Utilize both conventional and digital methods to enhance clarity and engagement.

Learn More with Product School

To learn about how to drive digital transformation in your organization, don’t miss out on our custom team training.  Our tailored team training, led by Silicon Valley experts, offers a deep dive into the strategies that can propel your business forward. Our training will equip your team with the latest tools to stay ahead of the game.

Schedule a call now to find out more about how our training sessions can give your organization a competitive edge.

Updated: May 6, 2024

Subscribe to The Product Blog

Discover Where Product is Heading Next

Share this post

By sharing your email, you agree to our Privacy Policy and Terms of Service