Digital transformation can either be a turning point for a business or an expensive white elephant that delivers very little value.
More companies are investing in AI-driven tools and digital solutions to streamline operations, improve efficiency and stay competitive. These projects are often launched with high expectations, yet many fail to deliver the desired results. The difference between success and failure usually comes down to who is leading the process and how decisions are made along the way.
In many organisations, these projects are driven by the IT department. While the team’s excitement about new technology is understandable, this can lead to decisions being made for the wrong reasons. Too often, solutions are selected because they are new and exciting rather than because they are the right fit for the business. This creates a risk that decision-makers are caught up in hype and jargon, with no clear understanding of how the technology will address the organisation’s actual needs.
To avoid this, transformation should be guided by someone who has an equal grasp of technology and the financial levers and strategy in the business. The person leading the project needs to be able to see the financial implications as clearly as the technical possibilities. A balanced skill set helps to ensure decisions are practical, sustainable and in line with the company’s overall goals rather than focused purely on the latest trends.
Another key factor is having the right team in place. Successful projects typically blend internal and external expertise. Internal teams know the business better than anyone and are essential for tailoring solutions to the organisation’s unique context. They can also help to drive buy-in from within the company. However, being too close to the project sometimes creates delays and unnecessary complexity.
External specialists bring fresh thinking and the ability to see challenges and opportunities from a different angle. They are often held to stricter timelines and deliverables, which helps to maintain focus and momentum. The combination of deep internal knowledge and external objectivity gives businesses the best chance of seeing a project through to successful completion.
A word on the role of AI and your people
This is one of the most topical elements when we think of digital transformation and the adoption of AI tools. It creates a very real leadership challenge for executive teams and if they get it wrong, it can create distrust with both internal and stakeholders.
Digital transformation has both hard and soft elements. On a practical level, it can reduce costs, speed up reporting, and increase profitability. It can also free up valuable time in finance and support functions by automating routine tasks. These benefits are important, but they come with a human impact.
My view is that while AI can accelerate many functions, it cannot replace the wisdom and insight that come from years of experience. The human judgement of senior leaders remains essential for guiding a business forward, especially when dealing with complex or sensitive decisions.
Many businesses, especially in financial services, are rushing to adopt AI and chatbots for client engagement. While this can improve efficiency, it risks damaging the very relationships that built the business in the first place. An area where I am feeling very uncomfortable is the use of AI tools to manage call-centre activities. This applies to both inbound and outbound activities. Organisations are looking to remove empathetic decision-making when it comes to their clients – while this theoretically will help make data-based decisions, we need to consider the impact of this on long-term client relationships.
Early clients were often won through a mix of emotion and fact, supported by personal trust and connection. These elements are difficult to replicate through a chatbot or automated message.
In a similar vein, when it comes to outbound activities, business is done between people. Are you truly going to foster better client relationships by having a robot dial out to potential clients?
Leaders need to remember that digital transformation is not a choice between people and technology. It is about finding a balance. Technology should enhance human relationships, not replace them. The businesses that succeed will be the ones that embrace innovation while staying true to the values and connections that earned their clients’ trust from the start.
This article is adapted from Rowan De Klerk’s monthly LinkedIn newsletter, where he shares strategic perspectives for business leaders.
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