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How to Implement a Digital Transformation Strategy

October 2022
Greg Selker
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The Former CEO of Crossmark Speaks with Greg Selker on How the Company Successfully Implemented DX

In the 33 years that I have been practicing executive search, I have met individuals who have the capabilities to drive business transformation at a holistic scale. Chris Moye is one of those leaders.  

I first met Chris in 2006, when he was the National Practice Leader of the Supply Chain Management (SCM) practice for Alverez & Marsal. He was the finalist candidate for a search with one of the top-five enterprise software companies in the world. The search originated from the CEO’s somewhat radical idea—he wanted an expert at SCM to come and apply those concepts to effect positive change in organizational structures, processes, and systems, which could impact every business and functional area, driving more efficient operations and producing tangibly better results.   

While Chris decided not to move forward with the role for personal reasons, we’ve stayed in close contact with each other. Recently, we had a series of conversations about Digital Transformation.   

In many ways, Digital Transformation could be described as the latest iteration of a series of movements over the past 50 years, all of which have been designed to improve the operational effectiveness of companies and drive superior results. We dove deeper into this topic last month. You can view last month’s article here. 

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An Introduction to Chris Moye

Chris Moye, successful PE-backed CEO, former Chief Transformation Officer at McKinsey, and VP at IBM has a unique background and perspective on what it takes to successfully implement an analog-to-digital transformation. He and I spoke about how he led the successful implementation of a multi-faceted DX strategy as CEO of Crossmark. Crossmark is a large middle-market B2B service company with >15,000 employees—a leading sales and marketing agency that specializes in growing retail brands throughout nearly every category of the consumer goods industry.  

There is no guide that fits every company, but Chris’ work offers a roadmap for companies looking to move into DX. We recently spoke about his playbook—how it both structures the approach while allowing for iterative “test and learn” pragmatism needed today.  

The Interview

This interview was condensed and edited for clarity.  

When you first joined Crossmark, you didn’t join to implement a digital transformation (DX) strategy. Why were you brought in? 

I joined Crossmark intending to sell the company on behalf of its PE owners, to optimize their returns. I spent most of my career involved in organizational transformations, across companies of many sizes and types, including General Motors, Nabisco, Campbell’s, and Avon (plus a host of smaller, PE-owned companies). I also worked with some top-tier professional services organizations such as Alvarez & Marsal during the financial crisis, with McKinsey in their specialist Transformation group, as well as with IBM in their Global Transformation group, where I learned the power and potential of Big Data-enabled tools that are creating Industry 4.0. This combination of experiences allowed first-hand learning of how best-in-class companies were thinking about digital disruption, what was possible with new digital tools, and what actually worked in the real world.  

Interestingly, the steps that need to be taken to prepare for a sale are also ones that need to happen before a company dives into digital. The first step for us at Crossmark was to stabilize the business. 

Interestingly, the steps that need to be taken to prepare for a sale are also ones that need to happen before a company dives into digital. 

Just before I arrived, Crossmark had gone through several years of underperformance. To right the ship, I immediately looked at where we could make operational improvements. This required cooperation from our clients. In one instance, we had a client whose service offerings lost money on a variable basis. We needed to fix this.  

Can you tell us a bit more about the initial steps you took to prepare for the sale, that ultimately set Crossmark up for digital transformation? 

The first step for us at Crossmark was to strengthen our business fundamentals. This, in turn, 

  1. improved financial performance 
  1. broke down siloes 
  1. built internal confidence that we could make meaningful improvements by working together, and 
  1. built confidence with our Board.  

These are all necessary to provide a strong foundation for a digital transformation.  

Specifically, we asked ourselves, “Can we pivot away from our losers into the winners—the areas where we make money?” The answer was that we could. To do so, we took the time to really understand where we made money and where changes were needed. This included “firing” some customers and, in some cases, changing our pricing—a task that took months to do. It takes time to get to the more structural issues, so it is important to make “no regrets” moves first and work on bigger issues over time. It’s also important to have those financial insights because they enable incremental improvements that provide internally funded capital for investment.  

Furthermore, while we had a GAAP-compliant P&L, it lacked valuable business insight. I worked closely with our CFO and our FP&A leader to redesign our financial statements. Getting all this right was so important that my CFO and I talked daily, sometimes many times each day.   

It’s pivotal to do this type of financial analysis, to understand where you’re making money, where you’re not making money, and where the opportunities are.  

Once a company has its act together, what should the next step be to move toward DX? 

Before we get to that, I think it’s important to know that if you want different results, you will need to make some changes to the culture—and this takes time. Therefore, you need to think ahead and be prepared to “walk your talk”—to model the new behaviors that are needed. Some think company culture doesn’t have a lot of hard business value. I beg to differ. It means getting people, over time, to align on values; the “why,” the “how,” and the “what” of the business. This is very important because an analog to digital transformation means redefining “work” throughout the organization. So, it necessarily goes deep and, in my experience, is fundamental to leading change.   

But to answer your question, the first phase of digital transformation is to align senior leaders and to have a series of focused discussions on business drivers and values. Surprisingly, this often gets overlooked, even though in most businesses there is no actual alignment on these important fundamentals. Then, before any changes are made, the senior leadership must come together and agree on the “North Star” guiding principles of the business, principles that are data-driven but also take into account user empathy. Ultimately, the success of your company’s digital transformation will depend on the level of buy-in generated by the rest of your teams.  

The first phase of digital transformation is to align senior leaders and to have a series of focused discussions on business drivers and values. 

During this alignment phase, the senior team is also becoming familiar with the playbook for digital transformation. Remember, this is new for them too. You’ll develop those guiding principles for how to move forward as a company. In our case, we used the ones that I had become familiar with at McKinsey and IBM. Mindsets, processes and behaviors are how you change a culture. Another was that we put in place a structure that would guide the overall journey, which we called the Strategic Initiative Office or SIO, which also had some guiding principles for how we would evaluate progress. Ultimately, the success of a company’s digital transformation will depend on the orchestration of many actions and objectives, so a structured and trust-based approach is important. 

Once alignment occurs, your senior team can then determine where the company can better provide value. To begin this process, a good exercise is to identify a challenge with your current approach and an opportunity where, if you applied a digital approach, the issue could be transformed. We did this at an offsite where we had a structured day of activity to learn about some specific, relevant (but not familiar) technological developments and tools that we might leverage. We all heard new, innovative, and exciting ideas that could be applied to our business. Then we broke into groups to engage in a “design thinking” exercise where we would envision our business with this new technology enabler.  

Another good exercise is to work backward. Identify your vision for where you want the company to be and map out the steps that can help take you there. In both of these exercises, it is helpful to take the time to comb through all available data, conduct an analysis of how you are currently applying data to deliver insights about your business, and identify where there are opportunities to apply that data or new data more effectively.  

Our team’s vision from this phase became overcoming the challenges of a large sales and marketing agency. To do this, our strategy shifted to an analytically driven approach. We had so much data available, but we weren’t using it to guide our work.   

You set the strategy and have a playbook. It’s still just an idea though. How do you turn the vision into reality? 

That’s exactly right. The next step of digital transformation translates the vision into business process designs. We began by asking several of our business leaders specific questions, such as:  

We had so much data available, but we saw an opportunity to change the way we operated with our new vision. This led to the creation of the Crossmark Accelerator, an advanced, analytics platform that leverages big data and machine learning, making it easier for our people to use and provide insights proactively for better decisions.  

To build what we called the Accelerator, we weren’t just tweaking existing processes. Because of the magnitude of the change, we needed to get our users, our front-line people, involved in the design of the new way of working. This is not top-down, and it is not bottom-up. Instead, it is an iterative test-and-learn way of co-creating a new business model.   

While these test-and-learns are ongoing, it’s important to keep in mind where the rubber meets the road. Hint, it is not the C-suite. Remember, that while digital transformation might begin with the senior leaders and broaden to business unit leaders, front-line workers face unique challenges that are likely not fully understood by senior teams. Experienced people recognize that ideas that appear simple and compelling on a PowerPoint slide may take many months to implement. The reality is that the complexities of day-to-day interactions with clients are often hidden in spreadsheets on desks and other institutional knowledge that is held in people’s heads.   

So how do you “eat the elephant” then? You build trust by acknowledging the complexity of the task and the expertise of those involved, and ensure that your approach reflects this. Rather than focus on the entire transformation at once, we recognized that the customer-facing business process is made up of micro-processes (and sometimes hidden habits) that are all linked together. The front line knows this truth very well. Many senior people don’t.  

At Crossmark, our senior leaders (supplemented by several outside consultants and technology vendors) worked side-by-side with our people across sales, insights, and IT. We completed nearly 1,800 critical path tasks by enlisting hundreds of people to define this new way of working. Our associates were the ones using this platform, so we felt it essential that they were involved in the creation of a new way of working. We asked these front-line workers to define the functions, look, and feel of the Accelerator.  

Even when you have your team’s attention on development, the reality is that not everything will work. For example, when we were moving to integrate multiple streams of work, we had a problem getting the core analytics processing to be efficient. What we found was that our approach to “pre-processing” our data before it went into the analytics engine was not working as expected. In our case, we had a sharp person who had been thinking about the issue before it became a crisis, and he moved quickly to solve the issue. This points to the need for leaders who can adapt and pivot when something appears headed for a dead end.  

Ultimately, digital transformation is a big change effort that requires a deep understanding of business processes to be integrated with new big-data-enabled tools. This effort is not always met favorably, to put it nicely.   

That’s a fascinating point. You and I have discussed the importance of Change Management in the past. Essentially, transformation cannot succeed without people’s involvement. How did you manage this at Crossmark? 

A company can take the time to strategize and build a platform, but its success hinges on those using it.  

We understood this, and that led to the creation of an internal marketing effort we called Transforming Together. The goals of Transforming Together were to communicate and educate our people about what we were doing, and why we were doing it. For digital transformation to succeed, you must methodically build buy-in over time. This is not the same as the buy-in of everyone. In all likelihood, you will never achieve total buy-in, but you need critical mass to do so.   

Remember, in order to effect digital transformation, it is essential that people’s habits and behaviors are changed. Transforming Together was our program for letting everyone at Crossmark know the “why”—our compelling reason for making this investment, “how” we were approaching the challenge (with many regular updates that built trust), and “what” the ultimate objective was. Consistency and repetition are important; you must stick with it to build trust.   

Transforming Together required a level of trust and transparency beyond what many companies typically achieve. A mass email outlining the changes won’t suffice. Crossmark had a large team; there were a lot of people we needed to reach. And there was some PTSD and mistrust of management in the ranks due to the previous years of underperformance and subsequent cost-cutting. We knew we had to speak directly with different business units to get that buy-in. I hosted several town halls for our teams so that genuine conversations could be had about this change. I needed our employees to know that I valued their input. We saw a great turnout at these town halls because we made sure they were entertaining and informative, and the buy-in eventually followed.   

Constant communication throughout the process is critical, especially during the implementation period. 

Constant communication throughout the process is critical, especially during the implementation period. You’re teaching people a new way of doing things and, eventually, you hope your teams will become the teachers to new employees. To help our employees understand and learn the platform, we developed The Crossmark Way.   

The Crossmark Way included our training, tools, and new, more streamlined ways for our people to communicate with our clients. For example, we established an extensive, iterative Accelerator training program to build our associates’ confidence in the platform. The training was designed to empower our associates and deliver consistent results.   

Most importantly, The Crossmark Way was not a stale, one-time-use teaching platform. It too was an iterative test-and-learn.   

Additionally, not only did we take the time to explain why we were implementing the Accelerator to be a better Crossmark for all our stakeholders, but we also explained what it meant for our associates, personally. It was an investment in them as much as it was an investment in a state-of-the-art analytics platform.   

In the end, we created a very effective team by investing in our people (training them and actually implementing their ideas) and, through our actions, showing them that the leadership team deserved their trust. This trust became the lubricant that made our significant investment in digital transformation a success.   

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Conclusion

In our interview, Chris provided some great context and insights on how he successfully implemented digital transformation at Crossmark. The process is not accomplished overnight. It requires a dedicated senior leadership team, a playbook, and a commitment to building trust. We’ll explore this in more detail in the final article from this series, which will present an overview and synopsis of the principles and framework Chris has leveraged for successful digital transformation.  

About the Author 

Greg Selker is a Managing Director and the North American Technology Practice Leader at Stanton Chase. 

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