A recent survey by KPMG confirms digital transformation is a key strategic priority for CEO’s. It is also time sensitive–85% of enterprise decision makers think they have a two-year timeframe to make significant inroads on their digital transformation before sustaining adverse financial impact and/or lagging the competition. A McKinsey report reveals the upside of digital transformation– data-driven organizations are 23 times more likely to acquire customers; six times as likely to retain customers; and 19 times as likely to be profitable as a result. CEO’s, in the words of Jerry Reed, have got “a long way to go and a short time to get there.”
The Legal Industry Is Not Prepared For Digital Consumers
How prepared are corporate legal departments to support their client organizations’ digital initiatives? Not very, according to Gartner–only 19% of in-house legal teams are well positioned to support enterprise digital efforts. Law firms fare even worse; the 2018 Georgetown Report concludes “most are still fighting the last war.” The Big Four and a handful of law-based companies–notably UnitedLex and LegalZoom (retail segment)–have crossed the digital divide and are positioned to capture greater market share. What about the vast majority of legal providers for whom digital transformation is not even on the radar screen? How will they competently engage with and compete for digital clients/customers? Short answer: not well.
The legal industry’s overall lack of digital awareness and preparedness is a serious problem that is seldom discussed. Legal providers instead tout their “innovation,” “client-centricity,” and “cutting-edge technology. Repetition of these buzz words-no matter how frequent or strident-does nothing to advance digital readiness. Understanding what digital transformation is, its transformative effect upon businesses, and its focus on consumers is a start.
Digital Transformation Is More Than Tech–It’s About New Customer-Centric Paradigms
Digital transformation is a holistic business paradigm shift that impacts a company’s people, activity, process, and culture. It is technology-enabled and data-driven, but those are the means-not the objective-of the process. Digital transformation involves harnessing data to create business insight that changes the operations/delivery capability of the company. This enables it to connect with consumers in different ways that include providing easier access, more choice, transparency, predictability, speed, and cost-effectiveness. By applying machine learning and artificial intelligence (AI) to large datasets, businesses can identify previously unknown correlations among data, providing them with enhanced capacity to predict outcomes, optimize delivery, mitigate risk, and tailor solutions to consumer demands and expectations. Automation enables businesses to act upon and scale these insights.
Digital transformation is much more than platforms, AI, and data. The human element is paramount at all levels. To achieve digital transformation, a business must engage in cultural change that involves collaboration, new skills, a more holistic approach to problem solving, diversity, cultural awareness, constant improvement, lifelong learning, and an agile workforce. Digital transformation also demands “soft skills” essential to complex problem solving, cultural change, and the agility required to keep pace with the ever-accelerating speed of business and pace of change . End-to-end customer experience optimization, operational flexibility, and innovation are key drivers and goals of digital transformation. They produce new revenue sources and an expanded customer base. All this requires a cultural change within an enterprise–and its business partners. Change management–convincing people to accept, adapt, and engage in constant improvement and training in anticipation of and response to change–is perhaps the biggest hurdle in the process.
Originally published in Forbes.