Digital Transformation is dead. Long live Process Transformation. (Episode 115)

Digital Transformation is dead. Long live Process Transformation. (Episode 115)

Interview with Carina van den Berg, Director Global Finance Sustainability & Operations at SKF.


What we call things matter. And if we talk about “Digital Transformation,” we are focusing on the tool (digital products and services) instead of the solution (better processes).

So yes, I am saying that for the last 25 years or so, businesses have been focusing on the wrong thing.

Companies shouldn’t be talking about “digital transformation”, they should be focusing on “process transformation”.

Sure, often process transformation includes digital solutions, but often they do not.

One department that has understood the need to focus on more effective and better processes is the finance department of the global bearings and seals company SKF.

Carina van den Berg, Director Global Finance Sustainability & Operations at SKF told me: “We have created what we call a “Finance Development Office” which is a transformation office filled with process experts dedicated to questioning, developing and transforming our processes.

Carina agrees that the phrase Digital Transformation can be distracting. Carina: “(In business) we talk way too much about ‘digitalisation’ and not at all enough about process development. (Leaders) should think much more about how we can get the job done better. This does not mean we shouldn’t digitalize. But the solution might be more education, better communication, clearer rules, or another million things that have nothing to do with anything digital.”

I asked Carina for three things to think about when it comes to Process Transformation.

In summary, she said:

1) Stop and reflect

With all the everyday work that has to be done it’s sometimes hard to understand what processes are actually not optimal. The whole idea of having a Financial Development Office is to have a place where experts get to evaluate and study existing processes as well as test out new ones. Their job is also to pick up suggestions for improvement from people working with existing processes.

2) Ask yourself: “What could we get rid of?”

It’s so easy to add a new process, system or procedure, but which of these can you take away?

Carina told a funny story about how some of her colleagues were swearing over a report they had to put together and Carina just told them: “Who are we doing this report for? Will anyone actually notice if we do not do it?” So they just didn’t do it and no one noticed for months….

I am not saying we should just stop doing our work – and neither is Carina – but we should question all the processes we have to study if they are really needed.

One of my pet peeves when traveling was all these tiny “landing cards” that you had to fill out when you landed in a new country in countries like Singapore or Malaysia, and then suddenly one day they were gone! A victory for the mindset of questioning which process could be removed.

3) The third advice for Process Transformation that Carina mentioned was: See the whole picture.

A process might make sense from your perspective, but processes often affect others as well. A finance process might affect the sales organization or procurement. Is your process optimal for everyone involved?

Carina shared the example of how the procurement organisation had noticed how efficient the finance department was at handling the invoices that they asked finance to handle the invoice process from start to finish. And by doing that the finance department got a holistic understanding of that process which made it possible for finance to make the process much more efficient.

The word “process” comes from the word “proceed” as in to carry on and to move forward.

In everything we set up within our companies we should ask “Is this process moving us forward and is there a better way that could move us forward more efficiently?”

At the SKF Finance Development Office they have a saying which goes: “What does good look like?”

Carina adds, with a smile, “We are not looking for ‘perfect’ the world is way too messy for perfect, but we are looking for a way of making what we do in the best way possible. To make it as good as possible.”

If you want your company to be effective, develop effective processes; and if you want effective processes make sure that people are focusing on questioning and evaluating old processes and imagining new and much better processes.

Make sure they are thinking of Process Transformation.

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