Daggerwing Group: Employees May Resist Digital Transformation - What Leaders Can Do to Drive Change

Cheryl Ferguson, President and Co-Founder
Imagine a virtual Town Hall where leaders are announcing the company’s next big initiatives in digital transformation. On screen, employee after employee is smiling in acknowledgment of the business benefits that it can bring. But many of those employees are immediately – and unconsciously – starting to fear and resist the changes that digital transformation will initiate, making transformation success difficult for CIOs.

The fact that studies show 70 percent of digital transformations fail to deliver expected results is no surprise to Cheryl Ferguson, President and Co-Founder of global change consulting firm Daggerwing Group. “For so long, the focus of digital transformation has been about implementing tools and technology,” says Cheryl. “Leaders may not understand that people are actually hardwired to resist change and react with negative biases although the new digital tools make perfect business sense.”

But, why are people such a barrier to digital transformation success?

Cheryl answers, “In our experience, most executives hope that their digital transformation announcements will be met with excitement – especially if it will help employees perform tasks faster or generate valuable data for decision-making. So, when employees react to the news with fear and resistance, Executives are often shocked and unprepared.”

In fact, those employees are not intentionally undermining a CIO’s digital vision – they are reacting the way their brains are hardwired to react to any type of change. Some employees will be biased towards the status quo – believing everything is best the way it is, so new digital technology isn’t needed. Some employees will be biased towards fear of loss – worrying about how it will impact their own role and job security. And some employees may be merely indifferent or react with a sense of fatigue from all the other changes that may be going on in the company – which can still undermine enthusiastic adoption. Shifting employees from resistance to acceptance is possible but takes more than a few all-employee emails and training sessions.

A successful digital transformation starts when a senior leader communicates to employees about what’s happening. That initial engagement has to start with sharing a clear, simple, and hopeful vision about what is changing, why, and why now. So, the need for urgency versus delay is understood.

Leaders may not understand that people are actually hardwired to resist change and react with negative biases although the new digital tools make perfect business sense

And when sharing that information, senior leaders need to explain the benefits to both the company and individual employees. Another key element of an initial message from senior leadership is addressing concerns they know will be in the hearts of their employees – wondering what digital transformation means for jobs, skill gaps, and ways of working.

How can leaders help in changing employees’ habits?

Senior leaders play a key role in driving awareness and understanding about digital transformation change as a first step to getting employees to accept and embrace what’s coming. The next step is to equip and enable people managers to get their teams to take action in new ways. Employees are more likely to resist change done to them compared to change done with them. So, managers are advised to make the employees in their team feel like they have an important part to play in what’s happening. Cheryl mentions, “It’s not just front-line employees that fear change of digital transformation. In many cases, even other senior leaders and managers may worry that they themselves lack the expertise required to realize a company’s digital transformation vision.” CIOs need to ensure fellow senior leaders’ psychological safety to acknowledge worries and skill gaps. It is helpful to spread the understanding that with digital transformation, everyone will be upskilling and continuously learning. “You need to hold leaders and managers accountable for making digital transformation happen, but you also need to give them the coaching and messaging they need to be successful with their people,” Cheryl adds.

Corporate leaders with expertise in creating competitive advantage with tech and data also need to be experts in the human side of transformation too. It is important to accept that employees will start out resisting the exciting digital plans you can’t wait to implement – but with the right empathy and engagement, employee resistance can be shifted to enthusiastic acceptance.

Daggerwing Group

Cheryl Ferguson, President and Co-Founder

Founded in 1999, Daggerwing Group works primarily with Fortune 500 firms, leveraging teams across North America, EMEA and APAC. The company partners with clients on their greatest transformation challenges – from operating model changes and M&As, to major culture shifts and digital, marketing and CX transformations. Following the mantra—do change right the first time— Daggerwing Group believes in working with clients on the people side of change because organizations don’t change, people do. They have proven methods to understand why people do and don’t want to change and accordingly design and execute a plan

Daggerwing Group