The ROI Of Agile Digital Transformation: Harnessing The Winds Of Change
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Measuring the return on investment (ROI) of Agile Digital Transformation can be a tricky endeavor, akin to attempting to measure the temperature of a vast, ever-changing landscape. How can we accurately gauge the success of any given transformation when there are so many moving parts?
It's like trying to take a thermometer reading on a windy beach. The temperature constantly shifts with the gusts of wind, and it’s hard to get an accurate reading.
Similarly, when it comes to digital transformation, it can be difficult to track the ROI without a clear understanding of the metrics and benchmarks. Nevertheless, it’s a crucial step in any business’s digital transformation journey, and it can be made easier by knowing the tricks of the trade.
Agile Digital Transformation Defined
Before diving into the methods of measuring ROI, it’s important to understand the concept of Agile Digital Transformation. You're likely familiar with the Agile methodology of software development, which emphasizes the use of short, iterative cycles of development, testing, and release. In recent years, this practice has moved outside of software development and become the driving force behind countless businesses.
Agile Digital Transformation is a variation of this methodology, applied to the broader world of digital transformation. The goal of Agile Digital Transformation is to quickly and efficiently identify and execute opportunities to improve customer experience and business processes.
There are several benefits to embracing this ideology, specifically when it comes to your digital transformation strategy.
Shortened Development Cycles - With a focus on iterative development, teams can quickly identify and act on opportunities, providing faster time toward digitization.
Cost Management - Agile Digital Transformation enables teams to efficiently track and manage costs associated with the digital transformation process.
Delivery Reliability - Incremental development ensures that each improvement is fully integrated before a new one is introduced, increasing success rates.
Customer Success - Agile Digital Transformation allows you to better understand customer needs and create digital solutions that directly address those needs.
Cost Management - Agile Digital Transformation enables teams to efficiently track and manage costs associated with the digital transformation process.
Collaboration - This methodology encourages collaboration between stakeholders, increasing engagement and improving the overall quality of the digital transformation process.
Transparency - Focusing on collaboration and quick turnover requires transparency that ultimately benefits your digital transformation through the democratization of data.
Data-Driven Insights - Agile Digital Transformation enables teams to capture data-driven insights in real-time, allowing them to quickly identify and address areas of improvement.
While Agile Digital Transformation is beneficial in many ways, measuring the ROI can be challenging. There are many different variables to consider, such as customer satisfaction, cost savings, and operational efficiency. Additionally, it is not always easy to attribute these benefits to the transformation process itself.
This strategy also requires your entire team to be on board and prepared to make quick decisions to capitalize on opportunities. Make sure you are holding regular meetings to remind everyone why you are working on digitization and ensure everyone knows what their role within the process is.
As the entire business world moves towards a maelstrom of digitization, the Agile process will keep you ahead of the curve.
Measuring ROI Within Agile Frameworks
As you stand in the winds of change trying to get a read on their success, you’ll be happy to know that Agile process makes it easier to take stock of how your digitization is progressing. Much like a meteorology thermometer designed to get a reading on a particularly windy day, this strategy is designed specifically for tasks that have lots of moving parts and require utmost transparency.
Here are some things to keep in mind as you get started.
Set Goals - Start by setting a goal for your project. This will provide a benchmark for you to use when measuring success.
Monitor Progress - Keep track of progress over time to determine if the goals are being met and if changes need to be made to reach those goals.
Benchmark - Compare progress against industry standard ROI metrics to gauge success or failure in the digital transformation process.
Take Action - Make decisions based on the data collected and adjust your strategy accordingly.
There are as many metrics for success as companies are aiming to digitize. Knowing what your team wants from their Digital Transformation is vital to keeping everyone engaged and on track. Here are just a few metrics you can use to track your ROI.
Increased Business Value - How much value is being created through the changes and how that affects the customer experience. Your company's bottom line.
Decreased Cycle Time - How quickly customer feedback can be processed and acted on.
Customer Happiness - How much customers are engaging with your product, services, and digital presence. How satisfied they are based on both qualitative and quantitative measures.
Employee Happiness - How much your team is engaged and content in their roles. How well they can collaborate, communicate, and execute.
Increased Agile Maturity - How willing and able your team is to continuously improve and organize themselves. Having value-creation at the center of all business decisions.
Increased Data Maturity - How effectively your team can use data to make decisions and how efficient they are in capturing, storing, and analyzing data.
These are just a few of the metrics that can be used to measure the success of your Digital Transformation. The thermometer of ROI is always changing, but using agile frameworks within your organization can help you stay on track.
How To Adopt Agile Frameworks into Your Digital Strategy
The most surefire way to successfully implement Agile Frameworks into any part of your business is to center the main values within the Agile Manifesto.
Individuals and Interactions Over Processes and Tools
In prioritizing your team, you will ensure that the digitization you pursue will actually help and excite the people who will be using it. Digitization for its own sake almost always fails. Work with your team to find out what they need and make sure they are on board with every iteration of your process.
Working Software Over Comprehensive Documentation
Of course, you need to be documenting changes and processes to keep track of your digital transformation as it progresses. However, if your team is getting bogged down with reporting and minutiae, they will be far less invested and successful.
Customer Collaboration Over Contract Negotiation
The goal of Digital Transformation is ultimately to improve the process for your customers. Agile Processes tell us to get the customer involved early and often, touching base this them about how the changes within your company are affecting them.
This can look like many things, including surveys, focus groups, and even user-driven innovation.
Responding to Change Over Following a Plan
Everyone looking into Digital Transformation knows that having a strategy in place is paramount, however, there is no point in tracking metrics throughout the process if you are not going to act on the information gathered.
Transformation of any kind requires adaptability and willingness to change, both key components of the Agile Framework. This kind of adaptability requires constant communication with your team about what’s working and what needs to change.
Agile Digital Transformation Best Practices
With some tips and tricks of the trade, you’ll be able to start reading the digital wind in no time at all.
Tip One: Diversify Your Metrics
To accurately measure ROI, you need to consider all aspects of the transformation process - from customer feedback to cost savings and more.
Additionally, you should look beyond just the financial returns and focus on how agile digital transformation has helped improve other areas such as customer satisfaction, collaboration, and decision-making.
Tip Two: Evaluate Over Time
As the transformation process continues, you should assess how much your return on investment has grown over time and if there are any areas where improvement is needed. With a continuous stream of information, you’re able to make changes on the fly and keep your digital transformation on track.
Tip Three: Utilize Automation
Automated reporting tools can help teams monitor their progress in real-time, allowing for quick adjustments if needed. They also take the pressure of documentation off of your team, freeing them up to focus on the process itself.
There are lots of other ways that automation can help your team adjust to change quickly by taking over menial tasks, to dealing with aspects of customer service.
The Bottom Line
Agility and tracking metrics are both vital parts of a successful digital transformation. Together, they allow you to spot anything that isn’t working, and steer your team back on track. It encourages collaboration, speeds up the transformation process, and ensures no one is left behind.
Planning for tacking ROI is like having a meteorologist in your back pocket, and when paired with the agile practice of always packing layers, your company will be ready for whatever weather the digital beach throws at them.
Agile teams worldwide already using Stormboard to guide their software development process also use the world’s only data-first collaboration platform to collaborate across departments and augment their organization’s digital transformation efforts.
Whether you live and breathe agile or this is the first you’ve ever heard of it, there’s a use case waiting for you in Stormboard. Sign up for free today and see for yourself what collaborative digital transformation can do for your bottom-line.
About the author:
A programmer by trade, Nick Saraev is a freelance writer and entrepreneur with a penchant for helping people excel in their careers. He's been featured on Popular Mechanics & Apple News, and has founded several successful companies in e-commerce, marketing, and artificial intelligence. When he's not working on his latest project, you can find him hiking or painting.
