Managing Uncertainty During a Digital Transformation

The following is adapted from Crawl, Walk, Run, by Michael Loban and Alex Yastrebenetsky.

Almost every time our analytics consulting company starts working with a large organization on their digital transformation, at least one member of their team will say, “We’re notorious for making decisions slowly.”

It’s a bit of a red flag, but not at all uncommon. Large organizations generally have a reputation for not being fast or agile, but if that describes your business, you must take steps to avoid any unintended consequences.

You need a good process in place to make decisions wisely. That process should achieve three goals: it should narrow your focus; encourage decision-making despite imperfect customer data; and position you to make “small bets” to protect you from larger risks down the road.

These objectives will not only keep uncertainty in check, but they will also move the decision-making process forward at a reasonable pace.

Narrow Your Company’s Focus During the Transformation

What differentiates successful companies from struggling companies is the ability to determine what to focus on and what to set aside.

A few years ago, when Yahoo! was run by ex-Google exec, Marissa Mayer, the company went through a significant redesign, created a new logo, acquired Tumblr, and pursued many other interesting initiatives. Despite this, it’s hard to think of one single thing that they did exceptionally well. It’s fair to conclude that they made too many decisions and pursued too many things.

On the other hand, look at what Facebook did during the same period of time. They realized users were moving from desktop to mobile, so they decided to focus on creating a mobile experience. Mark Zuckerberg held regular meetings to champion the cause. He knew that if they didn’t get this one thing right, everything else might fail. While there are plenty of ways you can criticize Facebook’s decisions, their focus on moving to mobile worked.

The lesson here is that instead of trying to pursue every initiative, figure out what the key decisions are that will either make or break the company. By passing on decisions that aren’t important in the long run, you’ll minimize uncertainty and keep the focus on what matters most.

Don’t Get Lost in Imperfect Data

Next, you need to make sure that the decision-making process keeps moving forward despite imperfect data sets. Leaders often feel uncertain and struggle to make decisions because of imperfect customer data, but customer behavior will always be hectic. Therefore, customer data will always be imperfect.

Think about the average journey of a customer deciding to buy a mattress online. They visit a website and look at the prices. Then they visit a brick-and-mortar store. They visit yet another website, check those prices, and maybe read some product descriptions. Finally, they decide to go on Amazon and buy the mattress they tested in-store.

Connecting the dots on such erratic behavior is nearly impossible. The customer experience is inherently uncertain and never entirely predictable, no matter how much you improve your online customer experience.

In this environment, we see a rising number of company leaders suffering from analysis paralysis. The simple fact is this: you have to be willing to make decisions without perfect data.

Place Small Bets

Lastly, to reduce uncertainty during a digital transformation, place “small bets” instead of making risky decisions that lead to major consequences. Determine the minimum threshold of data you need to make smart decisions.

Maybe you’ve experienced that all-too-common nightmare scenario of spending a few million dollars to run a big data integration project only to learn a few years down the road that the project doesn’t meet the initial requirements.

This kind of experience can be profoundly disheartening and contribute to analysis paralysis for future decisions. In order to make big, long-term decisions with confidence, we recommend placing numerous small bets and seeing how they pay off. In turn, those will help you make better “big bet” decisions.

After all, you only know a decision was right once you see the metrics or outcomes, and making small bets provides that vital feedback.

Aim to Minimize Uncertainty, Not Eliminate It

With a big project like a digital transformation, know that it’s impossible to eliminate uncertainty entirely. Keep your expectations realistic and instead aim to minimize and manage uncertainty throughout the process.

That process will feel much more manageable if it includes the three goals discussed above: narrowing your company’s focus, being comfortable with imperfect data, and placing small bets. These goals will save you from decision-making stagnation and move your digital transformation toward a successful conclusion.

For more advice on digital transformations, you can find Crawl, Walk, Run: Advancing Analytics Maturity with Google Marketing Platform on Amazon.

Alex Yastrebenetsky is CEO and co-founder of InfoTrust, a global analytics consulting and data governance company. Under his leadership, InfoTrust has received numerous honors and awards, with inclusions on Fortune’s Best Small Workplaces, Ad Age Best Places to Work, The Inc. 5000, and Inc. Best Workplaces.

Michael Loban is the Chief Marketing Officer at InfoTrust. He’s an adjunct instructor at the University of Cincinnati and Xavier University, and is also a presenter and author, with work published in Forbes, AdWeek, and CIO Magazine.