Digital transformation is a complex, high-risk organizational change that impacts an entire enterprise. A strong digital transformation leader is essential to guide the process, make critical decisions and drive adoption. To successfully navigate the transition, digital transformation leaders should incorporate a structured change management framework, like the Prosci Methodology. In this guide, we’ll explain digital transformation, the role of a transformation leader, and how change management can help them be successful. What Is Digital Transformation? Digital transformation involves integrating digital technology into a business' operations and processes, fundamentally changing how it operates. This major shift requires a cultural change that enables organizations to challenge the status quo and experiment continually. As of 2023, 88% of organizations achieved or planned to adopt a digital-first business strategy. Prosci research reflects this reality. According to over 10,800 change management professionals, technology and digital transformation are the most expected changes in 2024 and beyond. Top 5 Expected Changes by Industry Key aspects of digital transformation initiatives can include: Technology integration – Adopting digital tools and technologies like cloud computing, artificial intelligence, big data analytics, Internet of Things (IoT), and blockchain to improve processes and services. Process improvement – Optimizing operations through automation to increase efficiency, lower costs and enhance customer experience. Business model innovation – Developing new business models that leverage digital opportunities, like subscription services, platform-based businesses, and other products. Customer experience – Improving customer interactions and engagement through personalized experiences, interactions via digital channels, and real-time feedback mechanisms. Cultural changes – Creating a culture of innovation, agility and continuous improvement at the organizational level, encouraging collaboration across departments, and promoting digital literacy among employees. Nike Digital is a great example of digital transformation. The sportswear company launched a series of apps to connect with consumers and integrate their online and in-store shopping. As of 2022, Nike Digital accounts for 26% of all Nike revenue, helping the company overcome the challenges of the pandemic and gain a competitive advantage. What Is a Digital Transformation Leader? A digital transformation leader authorizes and manages digital project changes and initiatives. The role often requires a combination of strategic vision, technological expertise, and strong leadership skills. Leaders play a crucial role during a digital transformation. To excel in their role, a digital transformation leader needs a change management strategy that helps them get commitment and support from senior leadership, manage risks, and motivate employees to adopt change. Digital leaders deeply understand the latest technologies and how they impact the business model. They create strategies that help organizations capitalize on the newest opportunities and trends. They also work with the board, change professionals, and stakeholders to manage digital transformation efforts. Depending on the organization's structure and focus, a digital transformation leader may hold titles such as Chief Digital Officer (CDO), Chief Information Officer (CIO), or Chief Technology Officer (CTO). The responsibilities of a digital transformation leader can include: Strategic planning – Developing a clear digital transformation strategy that aligns with the business's strategic goals. Data-driven decision-making – Using data analytics to make informed decisions, measure success, and modify the digital transformation roadmap. Change management – Working with change management professionals to prepare and equip people to adopt and use digital changes in their work. Project management – Overseeing the planning, execution and delivery of digital transformation projects. With the help of the project management team, they ensure tasks are completed on time and to the desired quality standards. Collaboration – Working closely with various departments—like IT, marketing, operations and finance—to ensure that digital initiatives are integrated seamlessly across the organization. Resource allocation – Managing budgets and resources effectively throughout digital transformation initiatives. Performance monitoring – Using key performance indicators (KPIs) to measure success and identify areas for improvement. Risk management – Identifying potential risks associated with digital initiatives and building mitigation strategies. Digital leadership requires working with and managing employees during the change. To learn how to accept and succeed in their role, digital leaders can attend the Prosci Leading Your Team Through Change Workshop. The Challenges of a Digital Transformation Leader The nature of complex changes creates a variety of challenges, many of which can be mitigated through effective change management. These challenges include: Lack of credibility – Many employees and stakeholders can doubt a CDO's credibility. Resistance to change, a perceived lack of experience, skills, or knowledge, and unrealistic expectations drive this doubt. Inadequate resources – Limited resources, including budget, talent and technology can hinder a leader. These limitations can lead to project failure as CDOs struggle to implement change without the right talent or investment in training and development. Insufficient time – Executives and stakeholders often expect quick wins, but digital transformation takes time. When instant results aren’t delivered, employees can start to question the effectiveness of the leadership and sometimes the change itself, leading to resistance behaviors. Overlapping roles – The evolving nature of the CDO role can lead to poorly defined expectations and responsibilities. In addition, overlaps with roles such as CIO or CTO can create confusion. Unclear relationships with other leaders – Chief Digital Officers can struggle to maintain well-defined relationships with C-suite executives, especially the CEO. Understanding the people side of change is essential to overcoming these and other challenges. Collaborating with a change management practitioner enables relationship-building, commitment and role-clarity digital transformation leaders need to get support and resources for digital change initiatives. Leverage Change Management To Become a Successful Digital Transformation Leader Successful digital transformations require building a culture of digital learning where employees have a good grasp of technology and think creatively to innovate. Yet, changing an organizational culture takes time and considerable effort. People must adopt new ways of working—and do it at scale—to achieve the intended outcomes. This is why a proven change management approach like the Prosci Methodology is so helpful. Prosci research shows that projects with effective change management are seven times more likely to succeed than those with poor change management. Correlation of Change Management Effectiveness With Meeting Project Objectives The Prosci Methodology is a structured, repeatable approach that change practitioners apply to drive the people side of changes and help CDOs deliver results from digital transformations. Applying the methodology supports the CDO's goals in several important ways. 1. Creating active and visible sponsors A digital transformation leader needs sponsors to champion the change throughout the organization. A sponsor may be a business leader, executive or senior manager. Digital leaders can work with change management professionals to identify sponsors and assist them in fulfilling their roles. These practitioners apply specific change management approaches to coach sponsors, plan their activities, help them communicate with employees, and hold them accountable. Supporting sponsors this way helps them become more effective, and our research has shown that sponsor effectiveness directly correlates with meeting project objectives. Correlation of Sponsor Effectiveness With Meeting Objectives 2. Enhances communication Digital transformation leaders must communicate with PM professionals, CM networks, board members and stakeholders throughout the transition. This can be difficult given the lack of time and the number of responsibilities they have. Change professionals can help leaders create a communications plan that effectively articulates the vision, goals and benefits of digital transformation to leaders, stakeholders and employees. This transparent communication keeps everyone informed, builds trust, sets clear expectations, and reduces resistance. Effective change management also improves communications by sending the right messages from the right people at the right time. For example, the Prosci Best Practices in Change Management report found that 58% of employees prefer to receive messages about the personal impacts of change from their supervisor. Preferred Sender of Messages 3. Supports employees Digital transformation leaders must engage employees in the change. In addition to effective communication and sponsorship, they should prepare and equip people to adopt and use digital changes. The Prosci ADKAR® Model is a model for individual change that helps you enable people to adopt and use changes, including digital technologies, at scale. It is an acronym for the five outcomes an individual needs to achieve for a change to be successful: Awareness, Desire, Knowledge, Ability and Reinforcement. Prosci ADKAR Model Change practitioners work with the CDO to help people move through their individual transitions, break down barriers, and support them with training and coaching along the way. 4. Manage resources and risks The digital transformation leader needs to manage allocated resources effectively to complete projects on time and within the budget. Managing resources includes planning for funding and dedicated resources for change management. Prosci research shows a direct correlation between achieving good or excellent change management and having dedicated resources. Relationship Between Sufficient Resources and Change Management Effectiveness The Prosci Methodology incorporates a robust change management process and tools that help keep change teams on track to achieve desired outcomes. The Prosci 3-Phase Process process has three detailed phases: Phase 1 – Prepare Approach Phase 2 – Manage Change Phase 3 – Sustain Outcomes Each phase includes customizable tactics and tools to streamline and focus critical activities. By going through each phase, change practitioners, digital leaders and stakeholders form a shared definition of success and plan the processes to achieve it. They define and establish metrics, measure performance, and adjust as needed throughout the process. They also identify risks, anticipate barriers to success, and develop mitigation strategies. 5. Plan for reinforcement A digital transformation isn’t complete until people have adopted the change for the long term. This requires change leaders to plan for reinforcement and sustainment activities. Reinforcement activities, like rewards, recognition, corrective actions, celebrations and feedback mechanisms keep employees engaged in the new way of working and help sustain the change. Reinforcement is critical to successful change. Eighty-one percent of participants who planned for reinforcement or sustainment activities met or exceeded project objectives. Impact of Planning for Reinforcement on Project Success Reinforcement also involves tracking performance metrics related to the change. Leaders and people managers can use this to reward employees who comply with new systems or processes. Assessing performance also highlights areas where the change management strategy is not working or underperforming. Effective leaders use this data to modify their tactics to support the change better. Become a Successful Digital Transformation Leader With Prosci Digital transformation initiatives need strong leaders to reshape systems, culture and processes. To address change-related challenges, these leaders rely on change management professionals to help them navigate the people side of change. Applying a research-based, proven approach, like the Prosci Methodology, enables leaders to focus on the vision, leadership and technical aspects of the digital transformation while achieving the levels of adoption and usage that drive successful outcomes from digital transformations.

Do you take a top-down or a bottom-up approach when driving organizational change? While the Kotter 8-Step Process focuses on a leader’s perspective, the research-based Prosci ADKAR® Model enables you to drive change more effectively by supporting leaders at the top as well as people on the front lines of your organization—and everyone in between. In this way, the Prosci ADKAR Model offers something truly unique: an insider’s perspective that makes change stick by shepherding individuals through the process. While Kotter enables organizations to “do change to people,” the ADKAR Model works with people in the trenches, supporting them through their change journeys. When considering ADKAR vs. Kotter, which change management model is best for your organization? Let's decode these change management models. Understanding the Prosci ADKAR Model The Prosci ADKAR Model is a framework for sustainable transformation that supports change at individual and organizational levels. It includes five sequential elements or building blocks: Awareness – Of the need for change Desire – To participate and support the change Knowledge – On how to change Ability – To implement the required skills and behaviors Reinforcement – To sustain the change Jeff Hiatt, the founder of Prosci, developed this model in 1994 after researching 700 organizations. He wanted to understand why some changes succeed and others don't. He learned that human beings experience and react to change in predictable ways, and that supporting employees and leaders during transitions leads to far better outcomes. The ADKAR Model is grounded in a simple truth: Organizations don’t change, people do. ADKAR is popular around the world because it’s easy to understand and intuitive. In some ways, it’s like a roadmap, guiding you and your people through the terrain of change, from the first realization that a new direction is needed (Awareness) to the final step of making that change stick (Reinforcement). Imagine you're leading a project team to implement a new technology with significant changes in workflow. If people don’t adopt and use the technology, the change will fail and your organization will lose its investment—not to mention the desired strategic outcomes from installing the technology, like efficiencies, cost savings, and better employee satisfaction. The Prosci ADKAR Model also prompts a shift from passive observation to active participation in change. Each element of the model requires people to make a conscious choice to move forward or not. A change manager can help people through transitions, but change can’t be “done to them” when organizations use ADKAR. Even better, when you scale ADKAR with an organizational approach like the full Prosci Methodology, you gain the ability to align and drive complex changes while incorporating both the employee-centric and leadership perspectives. Want to take a deeper dive? Explore the building blocks of the Prosci ADKAR Model in our Prosci ADKAR Model eBook bundle. Overview of the Kotter 8-Step Change Model The Kotter 8-step Process originated in John Kotter's 1996 book, “Leading Change” and outlines eight sequential steps for change as follows: Instill urgency by highlighting the need for change and presenting the process’ benefits to spark initial motivation. Assemble a diverse team (guiding coalition) from various levels, departments, locations and genders to drive change for organization-wide support. Set clear goals and milestones for the change initiative and demonstrate how change will shift the organization’s future. Build a volunteer army willing to contribute to driving the change at an individual level while focusing on their transformation efforts at the collective level. Identify and address cultural, structural or resource-related obstacles, such as change complacency and legacy rules, to pave the way for change. Celebrate early and meaningful wins to maintain momentum and encourage the broader adoption of change. View change as a continuous process, highlighting the need for ongoing improvement until you fully realize your vision. Embed new practices into the organization's culture to make them standard operations for lasting change. Using the Kotter 8-Step change model addresses changes through a leader's lens. These steps serve as high-level directives for the change management work to be done by change management teams. ADKAR vs. Kotter: Similarities and Differences The Prosci ADKAR Model is a key part of a comprehensive change management approach called the Prosci Methodology. Both put people at the center of successful change through a strategic, bottom-up approach. Kotter's 8-Step Change Model is broad and less detailed, emphasizing organizational change driven by top-down directives. Understanding both change management models will help you choose the approach that aligns with your unique organization. A flawed comparison: ADKAR is not the Prosci Methodology Before we dig into the models, it’s important to note that people who are new to change management often confuse the ADKAR Model with the complete Prosci Methodology. It’s true that ADKAR is an individual change model that can be used for personal, professional, individual and organizational changes. But the comprehensive Prosci Methodology is what enables you to scale the ADKAR Model for organizational changes efficiently. Although organizations change one person at a time, it would be impractical to implement large-scale change management that way. The point is that comparing ADKAR vs. Kotter can be an inaccurate comparison. Although the ADKAR Model can be used without a comprehensive methodology, when implementing organizational changes, you should compare the full Prosci Methodology, including our ADKAR Model, to the Kotter 8-Step Process, as in the table below. ADKAR vs. Kotter Aspect Prosci ADKAR Model Prosci Methodology Kotter 8-Step Process Focus Individual transitions as the foundation for driving organizational change Structured approach to managing change at both individual and organizational levels Organizational change with a top-down approach Elements/Steps Awareness Desire Knowledge Ability Reinforcement Prosci ADKAR Model Prosci 3-Phase Process: Phase 1 – Prepare Approach Phase 2 - Manage Change Phase 3 – Sustain Outcomes Prosci Change Triangle (PCT) Model Establishing a sense of urgency Creating the guiding coalition Developing a vision and strategy Building a volunteer army Identifying and tackling change-related obstacles Generating short-term wins Consolidating gains and producing more change Anchoring new approaches in the culture Key advantages Focus on individual change Practical, actionable steps Employee-centric Comprehensive and strategic Structured approach Research-based Includes additional models, frameworks, tools and assessments Comprehensive and strategic Structured approach Emphasizes vision and coalition Complexity Widely considered easy to apply to changes, from simple to complex Moderate to high Requires training and resources Requires significant buy-in from top management Can be more complex to implement Adaptability Adaptable to different types and scales of change High Best suited for large-scale changes Resistance handling Proactively and directly removes difficult obstacles to change at multiple stages Scalable to any project size Focuses on managing resistance through strategy and vision communication Now that you know the key differences between ADKAR and Kotter, let’s take a closer look. Limitations of the Kotter Change Model The Kotter 8-step change model has disadvantages that ignore the barriers to change that cause employee resistance: Emphasizes the need to create a sense of urgency without providing detailed guidance on managing the complexities of change. Lacks clarity on vision and a strategy, despite providing a high-level roadmap Follows a step-by-step process where missing detailed steps can lead to confusion or misdirection Limits employee participation with its top-down approach, leading to potential frustration and feelings of disempowerment Positions change as a one-off event and fails to consider the continuous nature of change common in today's business environment Doesn’t address change readiness and lacks an analysis of the key organizational maturity models Doesn't consider the effects of previous changes and the cultural impacts of the proposed change Focuses only on organizational change, overlooking employees' personal transitions and emotional reactions during change Advantages of ADKAR Over Kotter When comparing ADKAR vs. Kotter, the Prosci ADKAR Model stands out by combining adaptability with a focus on individual transformation. This model for individual change sets itself apart with research-backed approaches and applications for effective change across various organizational settings. Let's explore some of the advantages that ADKAR has over Kotter. Adaptability – The Prosci ADKAR Model is adaptable to various project management methodologies, including Waterfall, Agile and hybrid approaches. Its flexibility aligns it with project milestones, ensuring individual change processes synchronize with organizational goals. This makes the Prosci ADKAR Model a versatile tool across diverse change initiatives. Practical implementation – The ADKAR Model works with organizational change processes, especially the Prosci 3-Phase Process, to scale even the most complex changes with actionable insights, tactics and tools. Focus on individual change – The Prosci ADKAR Model recognizes that organizational change is the cumulative result of individual transitions. It addresses the people and groups impacted by a change and creates an inclusive and supportive environment. Real-world effectiveness – By mapping project milestones to the Prosci ADKAR Model milestones, organizations can ensure that individuals are adequately prepared and supported throughout the change process. This alignment increases the likelihood of achieving desired strategic outcomes and sustaining long-term change. Enhanced sponsorship – The Prosci ADKAR Model strengthens sponsorships roles, guiding leaders to become more effective sponsors through their change journeys. Research validation – The foundational principles of the Prosci ADKAR Model come from 25 years of extensive research and real-world applications, offering a robust framework proven to drive successful change. Aligning ADKAR Elements in Sequential Change (e.g., Waterfall) Success Story: Prospera embraces ADKAR for seamless merger and cultural integration Following the merger of two sizable credit unions, Prospera faced the challenge of uniting cultures and systems without disrupting the member-focused services that define their organizational success. Prosci solutions: Initiated the Prosci Change Management Certification Program for key team members Implemented project acceleration workshops to integrate the Prosci ADKAR Model into ongoing projects Conducted the Change Management Sponsor Briefing meetings to enhance executive leadership’s role in change initiatives Secured an Enterprise Change Management (ECM) License for comprehensive access to the Prosci Methodology, models and tools Results: Cultivated a culture of change readiness and continuous learning Established an organizational change management team and committee, enhancing internal collaboration and support Achieved over 200 successful integration projects, significantly improving service delivery and member experience Increased employee engagement by 8%, and improved the change management maturity score by 6% on a five-point scale, demonstrating a substantial uplift in internal change capabilities By strategically applying the Prosci ADKAR Model, Prospera navigated the complexities of a merger and laid the foundation for a resilient, change-ready culture. Read the detailed case study here. Implementing ADKAR: Tips and Strategies To successfully apply the Prosci ADKAR Model, focus on clear and effective communication plans, setting clear goals, and providing support. Here's a high-level look at applying the ADKAR Model when driving a change at work: Start by communicating why the change is needed and why it needs to happen now. For example, digital transformation will improve efficiency now that employees work from home offices. Highlight the specific outcomes of mastering a new tool, such as saving an hour daily or developing skills that will offer career opportunities. Build desire by connecting the change to individual or organizational goals. For instance, illustrate personal transformation by highlighting someone who achieved something great recently. Provide the necessary training and resources. For a software upgrade, offer hands-on workshops. Create opportunities for practicing new skills. Set up a pilot project for the team where they can apply the skills learned in training. Reinforce the change by celebrating milestones through the new system and offering additional support as needed. Understanding and working to support people through resistance is crucial. Directly address barriers, such as lack of awareness, fears, or lack of confidence. Offer reassurance and support, and engage in two-way communications with your team about the change and processes to come. Here's a free quick-start guide showing how to apply the Prosci ADKAR Model to today's business challenges. ADKAR vs Kotter: Which Change Model Should You Choose? In the ADKAR vs. Kotter debate, the Prosci ADKAR Model prevails with its human-centric approach. Putting people first and addressing the human aspects of change will empower your teams to achieve your desired results and outcomes—and a truly successful organizational transformation.

Agile and innovative organizations need to consistently change their work processes, structures or culture to stay competitive. Although leaders can plan new goals or alter processes, successful organizational transformation relies on changing how employees and stakeholders work and the culture they're a part of. To successfully transform your company, you need a detailed change management strategy that engages employees, minimizes resistance, and facilitates the transition. In this guide, we'll explain organizational transformation and its importance in shaping culture during change. We'll detail the general transformation process and dive into why and how change management focuses on the people side of change to improve project outcomes. What Is Organizational Transformation? Organizational transformation is significantly changing the existing work culture to meet new mindsets and goals. It redefines a company's core operations, strategy and direction. While a change initiative targets specific areas and focuses on execution, transformation is a portfolio of interdependent change initiatives that affect the entire organization. Transformation is also iterative, experimental and more unpredictable. Organizational transformation can take many forms, including: Cultural transformation Digital transformation Mergers and acquisitions (M&A) Restructuring Process reengineering System changes Strategic transformation Innovation and product development Market expansion Leadership and governance changes Consider Amazon as an example of a well-executed strategic transformation and product development. In 2022, third-party sellers made up over 60% of sales in the Amazon store. To better support these sellers, the company announced drastic changes in 2023 to provide a range of products for independent sellers to simplify warehousing, delivery, finances and CRM. This transformation is set to ensure long-term partnerships between Amazon and the sellers on the platform, benefiting both over time. Why Organizational Transformation Needs Your Attention Culture shapes behavior, while people's commitment and capabilities drive performance. Without focusing on the employees, even the best strategies can fail. Because change management focuses on the people side of change, it is a critical driver of transformation. By implementing a detailed transformation strategy—a comprehensive plan ensuring effective, sustained and beneficial change—and using change management frameworks like the Prosci Methodology, companies can reap the benefits of organizational transformation, which include: Greater likelihood of success – A structured approach enables your business to drive faster adoption of changes. Our research shows that organizations with excellent change management are 4.6X more likely to stay on or ahead of schedule. Faster adoption can drive growth, revenue and profitability. Enhanced agility – When people adopt and use changes through organizational transformation, your business is better equipped to respond swiftly to evolving markets, customer demands and technologies. Improved productivity – By reevaluating and redesigning processes, organizations can remove inefficiencies and streamline operations, often using the latest technology. This enables people to collaborate better and builds a more productive workplace. Increased competitive advantage – Transformation can help organizations differentiate themselves from competitors, enter new markets, or enhance customer experiences. Foster innovation – Organizational transformation often involves adopting new technologies and methodologies, empowering employees to form and implement new ideas. This helps create new products and services while also reimagining those that already exist. Improved customer satisfaction – By better understanding customer needs, organizations can implement a customer-centric transformation that significantly enhances customer satisfaction. They can change or create systems or products that foster loyalty, increase retention, and attract new consumers. Although organizational transformation has plenty of benefits, the consequences can be severe when managed poorly. Misaligned objectives, inadequate focus on culture and people, and poor communication can lead to a workforce that’s disengaged, unproductive, and resistant to change. In the worst cases, a failed transformation can lead to losing competitive standing and financial instability. The Prosci Methodology 6 Key Aspects of the Organizational Transformation Process Transformation calls for systemic change, right down to the employees' day-to-day activities and habits. This requires careful planning, patience and persistence. Over time, the organization moves from resisting change to becoming resilient to change. Consider these key areas before you begin to plan for your organizational transformation: 1. Integrate project management and change management The technical aspects of the organizational transformation are only part of the equation. To achieve success, project teams need to align the technology, process changes, and other technical-side aspects of the change with the people-side aspects. This ensures that people are prepared and equipped to adopt changes at critical points during the transformation. Integrating the technical and people sides should begin during the planning stages of the transformation—well before making decisions about tools, technologies or processes—and not at go-live. Prosci Unified Value Proposition 2. Understand your change capabilities and maturity Before deploying an organizational transformation, it's essential to measure your change management capability and maturity. This depends on where you stand in five key areas: leadership, application, competencies, standardization and socialization. Once you've understood your company's change capabilities, you can develop a clear, structured business strategy outlining the organization's goals and the changes required to achieve them. Your approach must aim for a long-term steady transformation, rather than a big-bang approach that prioritizes quick results. A rushed transformation is often ineffective because impacted people struggle to keep up with the pace of the changes, ultimately burning out or becoming disengaged. 3. Align the leadership Successful transformation requires the organization's leadership’s commitment and alignment. Leaders must be unified in their vision and goals for the transformation program, ready to champion the change, and be prepared to actively support the transition throughout its lifecycle. Leadership teams must also train to build their own resilience, especially because transformation is a complex and lengthy process that often comes with challenges and negative thoughts. Change teams can help leaders navigate these and other issues by equipping them for their critical roles as sponsors of changes. 4. Engage stakeholders Engaging stakeholders (employees, customers, partners and investors) early and throughout the transformation process is crucial. This involves communicating the reasons behind and benefits of the transformation, addressing concerns, sharing your approach to change, and involving impacted people in the process. 5. Redesign processes and introduce new technologies Organizational transformation requires redesigning existing processes or creating new ones to align with goals or strategies. This can involve helping people adopt new systems, streamlining workflows, eliminating inefficiencies, and other changes to the way people do their daily work. Technology plays a critical role in modern organizational transformations. Integrating new digital tools and systems can enable better data analysis, improve communication, automate processes and enhance decision-making. New technological changes can be stressful for teams but a people-focused approach to change will help to combat this difficult transition. 6. Sustain outcomes Transformation is an ongoing process. To sustain positive results and build change capability, organizations must reinforce changes. The Prosci ADKAR® Model and Prosci Methodology have built-in mechanisms for continuous improvement, feedback accountability, recognition and reinforcement, and more to sustain outcomes. Among other activities, maintaining outcomes involves regularly reviewing performance, soliciting feedback, and adjusting strategies and processes. “Change takes time, especially when a culture change is involved. Research shows that on average it takes 5 to 7 years to embed sustained change in an organization. Most companies are trying to speed this process up, but the human brain is not geared to deal with multiple and continuous changes. This leads to stress and ultimately, burnout.”— Isabella Brusati, Change Management Director, Prosci Europe How Change Management Drives Successful Organizational Transformation Change management is a vital driver of successful organizational transformation. It involves preparing, equipping and supporting people through their individual change journeys, so they can adopt and use the changes involved in the overall transformation. Prosci research on the best practices in change management shows that organizations with effective change management are up to seven times more likely to meet or exceed objectives. Percentage of Respondents That Met or Exceeded Project Objectives Change management equips you to guide people through complex transformations while achieving benefits beyond implementing the technical aspects. Your business will: 1. Cultivate a culture of adaptability Individuals need to be informed and feel supported to adapt to change. Giving them the right tools helps them embrace change and creates an environment where team members can grow and learn. Effective change management contributes to adaptability through comprehensive communication, active and visible sponsorship, training resources, and other tasks and tools. 2. Gain leadership commitment Leaders and sponsors define and guide the direction of change. The Prosci Change Triangle (PCT) Model helps you understand the four critical aspects of successful change and how they work together to promote the health of your transformation. Change management enables you to get leaders involved and help them align the transformation with organizational goals. It also provides an approach to prepare and equip leaders to perform their responsibilities as sponsors of the transformation. This alignment builds trust and clarity, allowing leaders to make decisions and take actions that effectively implement and sustain change. The PCT Model for Organizational Transformation 3. Overcome resistance Resistance to change is natural but can be a significant barrier to successful transformation. Change management strategies focus on anticipating, identifying and addressing the root causes of resistance through impact assessments, coaching and other support. Change management also mitigates many resistance behaviors by involving employees in the transformation, so they engage and feel heard. For instance, over 41% of employees stated in a 2023 report that a lack of trust in leadership makes them resistant to change. While many underlying reasons exist for this mistrust, a change management strategy can alleviate it by helping create a trusting, open environment driven by transparent communication and active sponsors. 4. Effectively manage the transition The Prosci Methodology is a structured, adaptable and repeatable approach to managing the people side of change. It's comprised of three components: Prosci Change Triangle (PCT) Model – A framework to help change teams understand the four critical aspects of change success — Leadership/Sponsorship, Success, Project Management and Change Management. Prosci ADKAR Model – A model for helping individual people progress through change. Prosci 3-Phase Process – A structured process that enables organizations to scale individual adoption and usage at the organizational level. The Prosci Methodology is a research-based, proven approach to managing the people side of change. It includes assessments, frameworks and a robust set of tools designed to drive successful adoption of organizational transformations and project changes. 5. Sustained changes A crucial role of change management is to make business transformation permanent by embedding new behaviors and practices into the organization's operations and culture. Reinforcement is vital to sustaining change but is often difficult as organizations move from one change to the next while battling resource scarcity and change saturation. You can implement feedback loops, recognition programs, accountability systems, and continuous improvement processes to successfully reinforce change and prevent regression. How Prosci Can Elevate Your Organizational Transformation Organizational transformation can significantly affect processes, systems and structures. Leaders can propose and plan for transformations but are far less likely to succeed without a comprehensive change management methodology. An effective change management strategy prepares your company and employees for the transformation and guides you through the implementation, all while helping employees adapt to new systems and cultures.

Digital transformation management is a holistic approach integrating advanced digital technology across all business areas, fundamentally reshaping operations and driving enhanced value. In light of the COVID-19 pandemic, the global workforce rapidly adapted to remote work, with the U.S. and Finland experiencing increases of up to 61% and 60%, respectively, marking a significant shift in organizational work patterns. Amid this whirlwind, organizations struggle to truly harness the power of their digital investments, leaving potential gains on the table. The missing link? Effective change management. This article tackles the people side of change. With the Prosci research-backed approach, we will guide you through the nuances of digital transformation management. Empower your organization to bridge the gap between technology and its users, ensuring that every digital move you make counts. What Is Digital Transformation? At the start of the pandemic, Microsoft CEO Satya Nadella stated that the world saw two years' worth of digital transformation in just two months. “From remote teamwork and learning to sales and customer service to critical cloud infrastructure and security," he said, "we are working alongside customers daily to help them stay open for business in a world of remote everything. Nadella's comment resonates with organizations because the digital transformation most of us experienced involved installing necessary technologies to enable full remote work capabilities very quickly. Unfortunately, many organizations focused only on one aspect of the digital transformation: the technology itself. If digital transformation involves more than installing technology, what does digital transformation actually mean? According to Stanford University, digital transformation is more than a minor modification to business processes. It’s transformational because it’s about radically rethinking your business model and fundamentally changing how you do business. Salesforce defines digital transformation as using digital technologies to create new or modify existing business processes, organizational culture, and customer experiences to meet changing business and market requirements. The reimagining of business in the digital age is digital transformation. Gartner describes digital transformation as exploiting digital technologies and supporting capabilities to create a robust new digital business model. These definitions have an essential element in common: digital transformation touches the entire organization and the company’s business model. It comprises much more than technology because it requires a shift in how people in the organization work and, ultimately, a cultural change. This is what makes successful digital transformation tricky. The difference between digitalization and digital transformation is that the former applies technology to existing business processes and workflows, while the latter is about repurposing these processes and workflows in a new digital way. Understanding the distinctions between digital transformation, digitization and digitalization There needs to be more clarity about the difference between digital transformation, digitization and digitalization. Often, these terms are used interchangeably, but they mean different things—and it is not a matter of semantics. The benefits linked to each vary significantly. Digitization is the process of changing from analog to digital format. It is a classic example of converting handwritten text into digital form. Unlike digital transformation, digitization focuses on the information alone without changing the process, which becomes automated. Digitization helps by increasing productivity and efficiency while decreasing costs. Digitalization leverages digital technologies to change a business model and create new revenue-producing and value-producing opportunities. In other words, it’s moving to a digital business. With digitalization, existing processes and business models have been optimized, thanks to the ability to leverage digital data in a specific way through technology. An example of digitalization is uploading a PDF document (the handwritten text that was converted into digital form in the previous example) from a laptop’s hard drive to the cloud so it can be shared with other teams in the organization to enable them to analyze the data. Digital transformation requires both digitization and digitalization. The critical distinctive element is the transformation: how to create a long-term competitive advantage to be successful and retain importance in the market. Digital transformation is not about digitizing what companies already do or applying technology to the existing business to achieve the change (digitalization). It is about redefining how they create value and differentiate themselves from the competition by providing unique and personalized customer experiences. Digital transformation is made possible by the increased pace of inventions and by how these new technologies are combined to create new capabilities that exceed what could be possible when deployed separately. "Digital transformation is an ongoing process of changing the way you do business. It requires foundational investments in skills, projects, infrastructure and, often, in cleaning up IT systems. It requires mixing people, machines and business processes, with all the messiness that it entails." —Professor George F. Westerman, MIT Sloan School of Management Key challenges in digital transformation Many executives think that they are doing digital transformation by focusing on digitization or digitalization—here lies the challenge. Automating existing processes and workflows contributes to cost reduction but does not radically transform the business model and how business is done. Hence, this is one of the reasons why organizations do not achieve the expected ROI. They often envision that by implementing one or several digitization projects, they will achieve digital transformation. That’s not enough. Digital transformation requires changes to the culture and practices within the organization. A People-Centric Approach To the Value of Digital Transformation Digital transformation is more likely to succeed when organizations adopt a people-focused approach. The following key metrics assess the impact on team performance and customer satisfaction: Return on Investment (ROI): Essential for gauging how technology, training and staffing investments impact revenue and determine the effectiveness of digital transformation strategies. Time to Market: A vital metric measuring how swiftly digital solutions are delivered indicates a company's agility and competitive edge. Person Hours and Dollars to Working Prototype: This measures development efficiency, balancing speed and cost-effectiveness against technical debt risks. Usage Key Performance Indicators (KPIs): Monitors digital initiatives' adoption and engagement levels, offering insight into user acceptance. Productivity KPIs: Evaluate the availability and effectiveness of digital resources, skills and employee training, ensuring teams are equipped for digital transformation goals. These metrics provide an integrated view of the effects of digital transformation, in line with the Prosci focus on people-centered, outcome-oriented approaches. Expert insights on ROI: As digitalization reshapes business, ROI is increasingly defined by how well IT leaders align technology with business value. Peter Sondergaard, the former Executive VP of Gartner, highlights a shift in the landscape for IT professionals on ROI: "Digitalization is increasing the demand for IT leaders to understand how technology underpins business processes. A third of IT workers in digital businesses will require a working knowledge of the principles of business to advance." Satya Nadella, CEO of Microsoft, emphasizes that customer value is the main way to measure how successful an innovation is. "The true measure of our innovation is the value we create for our customers, and by that measure, we’re accelerating." Digital transformation success relies on IT melding technology with business goals to enhance customer experiences. This customer value is the real measure of your digital ROI. The central role of culture in digital transformation When I discuss digital transformation with clients, it is not unusual to hear that they concentrate mainly—or solely—on the importance of designing, developing, and deploying new technology, such as artificial intelligence (AI), Internet of Things (IoT), robotics, 3D printing, and BlockChain. Technology is undoubtedly essential, but it is only one side of the equation. Having state-of-the-art systems, software, and platforms is insufficient for a successful digital transformation. Experts on cultural change in DTM Digital transformation management is as much about changing company culture as it is about adopting new technologies. Leaders in the field echo this sentiment: Satya Nadella (CEO, Microsoft) on culture: “Our industry does not respect tradition. It only respects innovation. The first step to building the right company culture is to have a growth mindset.” Nadella's stance is clear—a culture that embraces learning and continuous improvement is crucial in a landscape driven by constant innovation. Linda Boff (CMO, GE) on culture: “Becoming a digital industrial company is a big cultural change for us. But culture is the hardest part. It’s easy to go buy technology off the shelf. The hard part is deciding what you want to be.” Boff highlights the challenge of defining a company's identity in the digital age—a task that demands intentional cultural evolution. According to these leaders, this demands a culture open to trying new things, learning, and quickly adapting. Such a culture is key to making the most of digital transformation for ongoing growth and innovation. Components of DTM The success of digital transformation management (DTM) hinges on a series of well-defined, strategic steps. Adaptability to Change: Embrace change as an opportunity. Prosci champions a culture of agility, ensuring your organization can navigate the digital tide's ebb and flow with grace and resilience. Openness to Innovation: Innovation is encouraged—it's sought after. We advocate for a proactive stance on innovation, inviting ideas that propel you forward and keep you at the forefront of your industry. Empathy and Collaboration: At Prosci, empathy is more than a value—it's a practice. It's about understanding and collaborating across all levels of the organization to ensure that every transition is smooth and considerate of the human element. Clear Communication: Clarity is king. Our approach to communication is straightforward and transparent, keeping everyone from stakeholders to staff aligned with the transformation vision and their roles within it. Ownership and Accountability: We believe in empowering individuals to take charge of their contributions. When people are accountable for their slice of the transformation, they drive change with a sense of purpose and pride. Success requires focusing on the organizational changes needed to leverage technology's opportunities. To take advantage of the power of technology, companies need to support the individuals impacted by the change so they can adopt and use the new technology, change their mindset, and adopt different critical behaviors required to deliver new products, services, and customer experiences. This means that leaders must direct their attention to the people side of change. The Project Manager’s Guide to Integrating Change Management in the Digital Age The disciplines of change management and project management each have a role to play in digital transformations, but effectively integrating the two disciplines enables the project's success and, ultimately, its return on investment (ROI). The Prosci Unified Value Proposition illustrates how this works. Typically, when dealing with what they think is digital transformation, organization leaders focus on the technical side or designing, developing, and delivering the solution (e.g., the new app or uploading files on the cloud). They often believe that because the technical side is in place, they will automatically see significant improvements to the bottom line. However, even if the solution is state-of-the-art, more is needed. The company must also focus on the people side of change with a repeatable, scalable approach. Impacted employees need to be supported in their personal change journey when adopting the new way of work and doing it proficiently. Specific focus must be put on the cultural change and the customer-centric experience. Embrace People-Centric Change With Digital Transformation The Prosci Methodology enables organizations to manage change successfully by supporting the impacted employees in their ADKAR journeys and facilitating organizational change through the Prosci 3-Phase Process. It’s best to incorporate change management during the planning stages when starting a digital transformation. If your project is in progress or fully implemented, change management can still help. Here's what you can do next to gain momentum with the people side of change and achieve quick wins. 1. Assess whether your organization is focusing on digitization, digitalization or digital transformation It's also critical to assess whether the focus is the true intent of the executives. If you realize there is a mismatch between the organization’s leaders' understanding of these concepts and what they entail, aim to educate the organization and show the consequences of incorrectly applying them. Support the leaders in reassessing their objectives and expectations. 2. Balancing tech and people in digital transformation If this is your situation, prepare a solid case for change management explaining why the people side of change is key when successfully implementing digital transformation. It is not only about technology—it is also about the people. 3. Integrate project management and change management It is essential to focus on supporting impacted individuals in adopting and using the solution and changing their mindset and critical behaviors linked to the new customer experience offered by the organization in which they operate. Integrating project management and change management enables you to accomplish this. Ensure your digital upgrades work well for your team. It leads to smoother operations and happier employees. Frequently Asked Questions: 1. What does a chief digital officer do? As a strategic leader, the Chief Digital Officer (CDO) guides organizations into the digital era. This role involves shaping the digital vision, orchestrating technology to meet business goals, and leading a cultural shift toward digital adoption. The CDO ensures digital practices enhance performance and customer service, making them pivotal in the organization's digital transformation journey. 2. How do you engage employees in digital transformation? Engaging employees in digital transformation involves communicating the benefits for their roles and the overall company. Essential steps include providing thorough training, involving staff in planning, and maintaining open communication. By valuing employee feedback, demonstrate how digital enhancements can streamline and improve their work efficiency. 3. How do you structure a digital transformation team? Structuring a digital transformation team requires diverse IT, change management, and business strategy skills. Key to this structure is appointing a Chief Digital Officer (CDO) who reports directly to the CEO or another executive board member. This leader oversees the transformation, ensuring alignment with the organization's vision and goals. The team, led by the CDO, must be flexible and capable of addressing both immediate objectives and long-term strategic aims. Remember, digital transformation management combines tech with the human touch for broader growth. Keep your people at the forefront, and if you need more guidance, reach out to Prosci for expert advice to advance your efforts. Bridge Digital Transformation With Effective Change Leadership Navigating digital transformation management extends to new technology and encompasses reshaping systems, company culture, and processes. A people-centric approach, as championed by Prosci, prioritizes your team's needs and perspectives. Each step towards digital integration should enhance value and encourage broader adoption, reflecting a holistic transformation that aligns technology with human-driven change. Are you ready to take the next step in effectively managing your digital transformation? To learn more, contact Prosci for real-world advisory services that drive results.