Real technology transformation starts with empowering people and teams

Ninety percent of the conversations I’ve had with senior leaders and technology stakeholders over the past 12 months have started with AI. But here’s a truth few are willing to accept: if you can’t clearly articulate what outcomes you’re trying to achieve, then AI — or any other transformative technology for that matter — will only accelerate confusion instead of driving value.  

This is a universal challenge. It transcends industries. Whether I’m engaged with business leaders in financial services, retail, automotive or manufacturing, the delusion is that success depends on the tool itself.

Consider this: Our own research shows that while 77% of business leaders plan to generate revenue through AI solutions in the coming year, more than half of business leaders know their AI expectations are growing faster than they can meet them.

The reality is that success depends less on the technology itself and more on the ability to align it to the organization’s unique goals, structure and, perhaps most importantly, culture. Not doing so can create frustration, erode trust and ultimately prevent organizations from achieving the financial gains they are hoping to see through AI.

Understanding IT’s role within an organization

Whenever I begin a new engagement with a client, we rarely start by talking about technological capabilities. Instead, we work to gain a fundamental understanding of IT’s role and function within an organization. This includes questions like:

• What role does IT play in your organization today?
• Is IT viewed as a strategic enabler or a support function?
• Where do you have a competitive advantage and how do you want to differentiate your products and services?
• What prevents you from launching better products and/or services?

These types of questions provide us with foundational insights into how an organization operates, as well as internal (and external) perceptions around technological capabilities.

It’s also worth noting that understanding IT’s limitations is just as important as understanding where and how IT supports organizational success. Having a strong grasp of both where an organization is winning and where opportunities for improvement exist allows us to be more strategic in our recommendations for which capabilities we need to build and where, and which investments to prioritize.

A common trap we often see from business leaders during this stage is narrow thinking around investments in transformative technologies. Are you investing just to cut costs? If so, there’s a ceiling to the value you can achieve. But if you’re investing to improve how your employees work, elevate product development and delivery, or enable new revenue streams, those kinds of investments have a much higher upside. They also require broader thinking and deeper alignment between teams and across the enterprise.

Prioritizing people and culture in transformation

One of the most frequent pitfalls I see in organizations struggling with transformation — including AI adoption — is a failure to acknowledge culture. That isn’t to say business leaders outright ignore it, but, in my experience, they tend to underestimate just how deeply it shapes behavior, risk tolerance and decision-making.

Two companies in the same industry, operating within the same regulatory environment and targeting the same customers, can — and typically do — take very different paths to success. Why? Because they harbor two very different business cultures and value sets. For example, is decision-making centralized or decentralized? Is experimentation encouraged or avoided? Is leadership comfortable with “failing fast,” or does a single failed pilot spell the end of an entire program?

These are the operating conditions for successful transformation initiatives — especially with AI — and also where I see many transformation efforts stall. If your organization doesn’t have a culture that embraces experimentation or tolerates failure in pursuit of learning, you’re not going to achieve the promised ROI of transformative technologies.  

AI is evolving so quickly that creating the solution isn’t the difficult part anymore. Where most organizations struggle is in building the mindset and workforce capabilities to operate the solutions. This is where the true “transformation” takes place.

This is also why we always start with discovery conversations, not just around business models or regulatory constraints, but with the talent, culture and structure of the organizations. These are critical components that will help determine if solutions will be accepted and perform long-term.

While understanding an organization’s business goals and objectives is incredibly important, and achieving those goals is our ultimate objective, any solution we create will fail if we don’t have a concrete understanding of where and how we can build scalable capabilities that empower individuals and teams.

Managing transformation fatigue

Unfortunately, many organizations are starting at a disadvantage. Their workforce has already gone through so many failed change programs that they are experiencing what we call “transformation fatigue.” This refers to a high degree of stress, burnout and distrust of change initiatives stemming from constantly being subject to change instead of being part of change.

Our research shows 44% of employees say transformation frequency is too high, and 31% don’t feel informed about the goals and ambitions of recent transformation projects — up from 25% last year. Over half of respondents say transformation fatigue is a growing concern, given the rise of AI transformation projects.

To some extent, change is, by definition, not comfortable. Friction stemming from change is inevitable, but it can also be anticipated and even managed. Recapturing the trust of your workforce is done by doing, and it’s up to leadership to earn back the trust of their workforce.

How? Start small. Begin with a single product line or an isolated part of the organization. Use that as a testing ground to trial new ways of working and gather evidence that can be used to inform future efforts (or even scale existing ones). Use early successes in this manner to highlight the value of change initiatives. When leaders can point to a successful implementation — even a small one — it creates belief. And when teams can see how their family work is getting better, not worse, it creates positive momentum. The seeds of long-term success are planted in these early successes and small wins. And they aren’t unique to AI — they’re the foundation of all successful transformation initiatives.

Digital transformation is never a one-size-fits-all solution

I’ve sat across from hundreds of business leaders, decision-makers and stakeholders representing nearly every industry imaginable. While those conversations may have similarities in the challenges they are experiencing, no two solutions to those challenges are ever exactly the same. What works in a decentralized, relationship-driven culture might completely fail in a top-down, process-oriented one. Understanding those nuances isn’t optional — it’s critical for success.

Think of it this way: prescribing walking to get healthy is generally a good idea, but if you have bad knees, it can be detrimental.

That’s the lens we’ve always put into our work as technology consultants, and that approach is even more imperative right now as organizations race to fully realize the benefits promised by AI. This often means helping clients move toward new ways of working, including structuring around value streams, embedding product management capabilities into their teams, and empowering cross-functional collaboration. Through this lens, we’re changing how our clients work forever by effectively embedding product-centric skills and capabilities within their organization. 

We oftentimes find those capabilities already exist, but they’re within small pockets across the organization. Our job is to spread those practices, scale what’s working and create a new normal for our clients.

AI is a powerful technology. But so was the cloud. So was mobile. So was ERP. What separates those who achieve meaningful results from their transformation initiatives from those who don’t isn’t the technology itself — it’s the alignment of that technology to their unique culture, needs and vision.

If your organization isn’t clear on how it creates value, where it wants to differentiate and what its people are capable of today (and could be capable of tomorrow), then no AI model in the world will change your trajectory.

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