Creating your company's digital transformation road map

Ryan Pickering, experienced manager at Baker Tilly, opened his presentation at the 2021 Sage Transform conference with a startling statistic: 70% of all digital transformation projects fail to meet stated goals. The reasons for failure range from lack of executive support and misunderstandings about the scope of the project to active resistance from employees tasked with doing extra work.

And yet, digital transformation, which allows companies to make decisions based on data rather than on opinion, is critical in today’s highly competitive business world. Developing a “road map” to keep digital transformations on track is essential for success.

The road map reflects the goals of the transformation, the timeline of the project and who is expected to complete the various steps. The approach helps prevent misunderstandings and has proven very successful as the team has completed more than 900 implementations, transforming client organizations into digital powerhouses.

Building a road map while avoiding the potholes

While the speaker cautioned that putting together a road map will not be enough to solve all the challenges that come up during a digital implementation, a road map helps major stakeholders understand the objectives, outline how available resources are allocated and coach employees about how to complete their “day jobs” while fulfilling additional transformation duties. Each road map will look different, depending on the scope and difficulty of the transformational project.

As a first step, the speaker suggested transformation teams consider how to avoid the “most common” technology transformation pitfalls that arise:

1. Lack of strategic alignment between partners and clients: This occurs when stakeholders have different visions of what success looks like. Careful documentation of project goals brings to light the mismatches between the vision and reality.

2. An “all or nothing” mentality: If the client expects to see improvements and return-on-investment as soon as the new technology goes live, disappointment is almost guaranteed. Make sure the road map gives clients a realistic view of when to expect notable gains.

3. Designing in a silo: Design with the end in mind, then tell everyone involved what the long-term goals, objectives and future phases might be. When the entire team understands how day-to-day and small decisions feed into the larger project, then rework, delays and budget over-runs decrease.

4. Organizational and project team burnout: As the project proceeds, team members and sponsors may lose interest as other priorities take over. Perhaps they feel overwhelmed by the additional work, or can’t see the finish line, or can’t answer “what’s in it for me?” Regular team meetings and progress reviews against the road map, along with praise from executive sponsors, can help quench burnout.

Why build a road map?

Pickering then laid out the four major reasons for representing a transformational project in an easy-to-visualize road map, created with information gathered with Sage Intacct financial software.

1. Assists investment planning: Proving the adage “a picture is worth a thousand words,” a road map offers a visual representation of planned investments and helps executives evaluate them against other organizational initiatives. The road map also helps finance leaders articulate their vision and helps everyone understand why the accounting function is so important. The road map guides leaders as they manage external factors, like the COVID-19 pandemic.

Having a tool in place that allows leaders to visualize options allows them to have “more effective conversations,” Pickering said.

2. Aligns leadership: Company and IT leaders will use the road map to pick key initiatives and priorities, then evaluate the impact on strategic objectives, team prioritization and resource capacity. The road map will also be used to inform everyone on the team of changes in direction when the document is updated and re-socialized.

3. Provides clear objectives: The road map provides staff and project teams visibility into the long-term vision of the organization and helps articulate the importance of their work. Road maps help reduce what Pickering called “reactional transformation,” when seemingly endless projects are passed down from management, causing team members to “burn out” and lose interest. And it reminds employees about assignments outside their usual roles in the company.

4. Improves project execution: The road map fosters alignment between the partner and client, and therefore reduces “slippage” in project scope and schedule. It also allows project managers and team members to better manage individual “phases” of the road map.

What should project leaders include in their road map?

Because each client has different needs and objectives, each road map will be different, the speaker pointed out. But, a robust road map likely will include these common elements:

1. Comprehensive timeline: In building a project timeline, project leaders should consider any existing initiatives within the company that may be dependent on the transformational project and weave those into the timeline.

2. Key dates: Leaders should also consider blackout periods and month-end accounting activities, such as payroll preparation and subscription renewals, that could affect the project.

3. Phasing: Project managers should think through whether the organization’s requirements would best be met by a phased implementation or by a so-called “big bang” where new technology goes live all at once. The approach should be represented on the road map.

4. Metrics and key performance indicators: Leaders should get agreement from executives about which metrics best assess the success of the digital transformation. Include them on the road map along with the tools and processes the team will use to measure progress.

5. Resources: Finally, the road map should spell out the skills and experience team members should have to make the transformation a success and any staffing limitations that exist.

Road map examples

Examples of road maps constructed for three situations were presented: a phased implementation of new technology, a project aimed at fostering organizational growth and one intended to optimize systems.

Phased implementation

The first example represents a phased implementation at a hospitality service company with many entities and a lot of resistance to change. The leaders built a business calendar across the top with key business dates and holidays to orient the viewers in time. Many things changed during this phased implementation, and the road map helped the team revisit old decisions during changing business circumstances. Pickering pointed out that on this road map the contributions of third-party vendors, considered critical to the success of the project, were also noted.

Organizational growth

The client was experiencing dramatic and rapid growth, from $30 million to $300 million. The company suffered from a lack of accounting knowledge but enjoyed strong executive sponsorship. Given only six weeks to go live without full time support, the team found the road map helped them negotiate resources and choose technology that would support long-term growth. Pickering added that the team was able to use the road map to tell executives when to expect major costs, especially important in the beginning of the project when available cash was tight.

System optimization

The final road map example came from a virtual reality startup, whose leaders wanted to visualize how they could optimize their new system during the next few years. The team used this road map to get client buy-in about how the consultants would address future needs after the initial implementation.

Although it’s simple, the visualization of the roadmap brings together many elements in technology transformation for the client. Pickering added that the road maps document how far the project has come over time and the transformational milestones met and are great subjects for review with clients during regular update meetings.

To learn how to build a road map for your organization, contact one of our experienced Baker Tilly professionals today.