Striking a Balance Between Digital Innovation and Risk

Today’s organizations must keep modernizing their processes by leveraging cutting-edge digital technologies to meet growing customer and employee expectations. However, the road to digital innovation is paved with many obstacles, and striking a balance between innovation and risk is one of them.

Digital Innovation is Inherently Risky but Necessary

There’s a good reason why so many organizations resist change: innovation is inherently risky. Whenever outdated systems and processes are replaced with modern alternatives, issues can happen, including:

Temporary instability

Higher-than-expected expenses

Heightened exposure to cybersecurity threats

To avoid these and other issues, many organizations delay innovation for as long as possible. Unfortunately, this allows their competitors to get ahead. When that happens, negative reviews often follow, and the loss of customer loyalty is difficult to reverse.

Digital innovation is necessary, but it must be approached properly so it doesn’t create even more risk.

Balancing Digital Innovation and Risk

Organizations worldwide are expected to spend around $3.3 trillion on digital transformation projects by 2025. Despite all of that investment, up to 84 percent of these initiatives will fail, according to Forbes.

Understanding the key traits of successful and unsuccessful digital transformation projects helps you innovate effectively and overcome challenges along the way.

Five Steps to Successful Digital Innovation

1. Set Realistic Expectations and Goals

Organizations that achieve digital transformation success begin with realistic expectations and well-defined goals. To set achievable targets within a reasonable timeframe and budget, it’s important to avoid focusing solely on the end result.

Instead, assess your current position and map out the entire journey to your desired outcome. This approach ensures you account for the systems, processes, and people that will be impacted by the transformation, enabling a smoother and more effective transition.

2. Have the Right Mindset

Resistance to digital innovation can come from both employees and stakeholders – which can make even realistic goals difficult to achieve.

To prevent resistance to change from ruining your plans, your organization should have the right digital transformation mindset. Everyone should view innovation as a positive and essential initiative.

Executives must lead the way by being united and clearly communicating to employees the reasons for the change and the steps needed to achieve it.

3. Make the Right Technology Choices

No matter which part of your organization you choose to transform, you’ll face a variety of competing technology options—each with its own strengths and weaknesses.

Choosing the right technology can significantly reduce the risk of business disruption, while the wrong choice can greatly increase it. The best option is one that fully aligns with your specific needs and requirements.

To make an informed decision, you need a clear understanding of the available technology solutions – a process a trusted IT partner can guide you through.

4. Help Employees Increase Their Technical Know-how

A joint study by Stanford University Professor Jeff Hancock and security firm Tessian found that 88% of data breaches result from employee errors.

When an organization introduces a new digital tool or upgrades its IT infrastructure, the risk of employee-caused data breaches increases – unless the organization ensures that employees have the technical skills to adapt to the changes.

5. Acquire the Necessary IT Talent

It’s impossible to complete any digital transformation project without IT talent. Seasoned IT professionals bring indispensable skills and experience to the table that can go a long way in steering the project toward success.

Unfortunately, acquiring the necessary IT talent can be a challenge in of itself, especially for smaller organizations that can’t justify or afford to staff an in-house IT department.

Unlock the secrets to successfully hiring IT professionals for your small business. Quickly navigate the challenges of identifying the right candidates to support and grow your business effectively.