Thank you so much for joining us in this interview series. Before we dive in, our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?
I grew up in India, but I was fortunate to get the opportunity to live, study, and work in multiple countries before coming to the US to go to business school. I believe my global experiences during my formative years played a key role in shaping my perspectives as they provided me with unique insights into how bringing together diverse people, thoughts and ideas were critical for success. My experiences also helped me as I worked with various leading global financial, professional and legal services businesses, bringing together global teams from diverse backgrounds to innovate, transform and grow businesses for continued market success. After successfully innovating and transforming several large global, mid and small businesses, I started Idea Innovate Consulting to advise PE firms on improving the performance of companies in their portfolio, and with PE-funded companies to achieve accelerated organic and inorganic growth, pre- and post-merger integration, and optimization of operations, business and talent models.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘takeaways’ you learned from that?
One of the funniest mistakes happened at the beginning of my consulting career when I was still new to the U.S. I am not sure if people are aware that terminology in the U.S for several things differs from the rest of the word, such as, elevator vs. lift, trunk vs. boot or dickie, gas vs. petrol, soccer vs. football, etc. The consulting firm I worked with was brought in to transform the investment banking division of a large well-reputed investment bank. The investment banking partner was talking about a recently held Monday night football game. At that time, I did not realize that American football, is different from football in the rest of the world (football is called soccer in the U.S. which is very distinct from American football). To “fit in” I made some remarks about a recent soccer/football game that I had seen. Silence fell across the room after I made my remarks. I then realized that I had messed up. My partner quickly stepped in and covered up my lack of knowledge about American football. We then moved on to the presentation, but I realized that my credibility had been somewhat diminished in the eyes of the banker because I was unable to discuss American football with him. What this experience taught me was that it is critical to understand the cultural nuances of the people who you are working with, and it can be an effective way to build personal rapport, which translates into a stronger working relationship. After that I always made it a point to do my homework on the background of the person/people I was going to work with and discussed topics and issues that were important to them, which helped me connect with them, established a better working relationship and resulted in more positive outcomes.
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful for who helped get you to where you are? Can you share a story?
I have been lucky to have many great leaders guide and help me. The one I would like to talk about is the CEO of the Global Audit business at Deloitte, who gave me the authority and the responsibility to transform the business. He was a true visionary and recognized that the business needed to change drastically if it was going to continue to be profitable. He brought me in from the consulting side of the business. When I mentioned that I was not an auditor and did not know how to do conduct an audit, he stated that he wanted someone with a different perspective and mindset who was not hindered by how things were done in the past, to drive the change in the practice. As we were transforming the Audit business, he pushed me and my team to be bolder and think about how we could disrupt the business before an outside firm came and disrupted us. He showed me what a true leader should be, by being bold in his vision, encouraging diversity, giving the necessary funding, air cover, and the authority and responsibility to drive the change. In many ways, he set the benchmark for what a great leader needs to look like. What I have learnt from him helps me even today as I continue to work on transforming businesses.
Is there a particular book, podcast, or film that made a significant impact on you? Can you share a story or explain why it resonated with you so much?
The movie that had a significant impact on me was “Gladiator.” To me the entire movie was about leadership and teamwork. Maximus showed us what it meant to be a leader, as he led his team from the front, whether it was in the battlefield fighting the Germans, or working with the other gladiators to keep everyone alive. He demonstrated that leadership has nothing to do with the title / position that you have, but the ability to inspire and lead people, and get them to work together as a team to achieve a common goal. Two of my favorite quotes from the movie are, “what we do in life echoes in eternity” and “whatever comes out of these gates, we’ve got a better chance of survival if we work together.” This resonated with me when I volunteered to coach my daughter for soccer. Since I was the head coach, I had to lead the team through training and the games. I treated my assistant coaches and the kids on the team as my partners and recognized that we needed to work together to win. We had a good team but lost the first few soccer games. I asked one of the parents to give us feedback on how we played. She said that we had good offense, but our defense was weak and hence goals were being scored on us. Both offense and defense are critical for the success of the team. Using that feedback, I adjusted how the team played, and made sure that I leveraged each player’s strengths and put them in positions where they could succeed. As a result, we won the championship. This showed me the value of being a leader in all circumstances and putting together a winning team, by playing to their strengths.
Are you working on any new, exciting projects now? How do you think that might help people?
There are two exciting projects I would like to talk about. The first one is on the personal front. I wrote a chapter in a book that got published in June 2024, called Own Your Story — Empower, Connect, Create Change. I am a co-author in this book with 30 other amazing women where we all share our stories, to cultivate empathy and understanding among the readers, and discuss ways to succeed. My story is about how to innovate and change to achieve success in a VUCA (Volatile, Uncertain, Complex and Ambiguous) world.
The second project I am excited about is where I am working with a small team to create an Audit platform, which leverages AI & Applied Data Science to automate tasks and enhance the audit process. Given my background in having transformed the Global Audit business of a Big Four firm, and the Audit business of a mid-sized firm, I believe this product could be a game changer in an industry that is being disrupted by AI.
Thank you for all that. Let’s now turn to the main focus of our discussion about Digital Transformation. Digital transformation can mean many things to many people, from your perspective, how do you define digital transformation in your industry?
Digital transformation is a strategic initiative that involves integrating digital technologies and solutions into every aspect of a business, leading to a fundamental shift in how the organization operates and delivers customer experiences and benefits. This requires the firm to examine its entire business model, using software as the core to the firm’s competitive advantage, customizing how the firm goes-to-market; products, offerings or services it offers to clients; and upgrading the operations and technology infrastructure. Finally digital transformation is about the people, i.e. the employees, and the customers. They are the primary beneficiaries of a digital transformation, as well as the drivers of change, and need to be made a critical part of the digital transformation journey. Without their input and buy-in a digital transformation effort will not succeed. I come from the Professional Services (Audit, Tax and Advisory) industry. My industry is being disrupted by AI and most firms in the industry are trying to determine how to digitally transform their business to continue to be successful and are at various stages of their transformation journey.
Which companies can most benefit from Digital Transformation?
Most companies can benefit from Digital Transformation. However, the key impetus for firms embarking on digital transformation journey are the industry they operate in, and the size of their business.
- Industry –Companies that are in industries that are being disrupted are in the most urgent need of a digital transformation. The disruption could be caused by:
- Natural Disasters — Covid was a natural disaster that acted as a huge disruptor, impacting the ability of people to physically go to stores, and caused a big market shift in how firms in Consumer Retail, Restaurants, Media & Entertainment, etc., needed to operate. They had to pivot and digitally transform their businesses to offering online services to their customers, to meet their needs when the world abruptly shut down.
- Changing Customer Needs — Young consumers, who are digital natives, are used to leveraging their mobile devices to meet their needs, are less tied to name brands, and expect personalized solutions. This shift has impacted industries such as Banking & Securities & Insurance, as FinTechs have emerged to address consumers’ pain points with their traditional financial service providers. To continue to remain competitive and retain their client base, large financial institutions have had to transform their business models and add digital and mobile offerings.
- Rise of New Technologies — The rise of Generative AI has the potential of significantly impacting industries such as Professional and Legal Services, as it can create content and provide insights, a core capability of knowledge professionals. To continue to remain profitable, businesses in these industries will need to determine how Gen AI will impact their business, and transform what products and services they deliver, how they deliver those services, the talent needed to deliver the services, and how to charge clients. Firms in these industries are already starting to transform their business models.
Some sectors such as Public Sector, Government, Healthcare (not Services), Hospitality, Construction, etc. tend to be laggards in transformation.
- Size of Business — The size of the entity also has an impact on the willingness and ability of the organization to initiate a digital transformation.
- Large Corporates — Larger corporations in most industries, find it harder to drive digital transformation, as there is (i) reluctance to change a successful business model, (ii) resistance to change from well-entrenched senior professionals and leaders, (iii) lack of agility due to the size of the organization. Unless there is a “burning platform for change” these firms usually do not initiate a business transformation. History is replete with firms that became obsolete as they could not transform in a timely fashion. Blockbuster and Kodak are two such famous examples.
- Medium-Sized Corporates — This group has the highest incentive to transform their business and address the unmet needs or “pain points” of clients to gain a disproportionate share of the market and move ahead of their competitors. Additionally, these firms are nimble enough to pivot and act quickly when there are disruptive events, combined with deep pockets to execute on a digital transformation.
- Small to Mid-Sized Entities (SMEs) — This is the largest market segment in terms of numbers, but with limited financial strength. They have the greatest need to digitally transform their business, but usually have the least resources. They are, however, open to outsourcing parts of their mid- and back-office operations, i.e. marketing, finance, technology support, security and privacy, accounting, etc. to specialists who can perform those tasks more efficiently leveraging technology, and cost effectively. This enables these SMEs to focus on their revenue generating activities. Many professional services firms are offering these outsourced services to these entities.
Has integrating Digital Transformation been a challenging process for some companies? What are the challenges? How do you help resolve them?
Digital transformation is a challenging process for many companies. According to an HBR study, about 89% of large companies globally have a digital and AI transformation underway, but they have only captured 31% of the expected revenue lift and 25% of expected cost savings from the effort.(1) Digital transformation is a journey and most firms do not realize the time, effort and funds it takes to transform a business. Some of the challenges that firms face in driving digital transformation are:
- Poor alignment with firm strategy and business outcomes — Organizations often have unclear goals on what they want to achieve with a digital transformation. A successful digital transformation needs to be aligned with the firm strategy and have the buy-in from the C-suite and division/business leaders and provide a cost-benefit analysis to justify the investment. Some firms incorrectly believe that investments in technology are the key to success. Technology is an enabler of transformation, not a driver.
- Putting the wrong leader and team in place — Firms often tend to have a technologist lead the transformation efforts, which can be problematic. A leader that brings soft people skills is a better fit. Digital transformation requires leadership working closely with the C-suite of the company, and act as an orchestrator of transformation across the firm bringing together a cross-functional team, which includes business leaders, technologists, legal, risk and regulatory, marketing and change management, etc. A successful team should include 80% soft skills and 20% technical prowess.
- Lack of focus on change management — Firms often forget that digital transformation is about people, not just technology. For a digital transformation to be successful, clients and firm professionals need to be brought along on the change journey. If this is not done effectively, then employees may resist new software, tools, and processes as they don’t understand their benefits. Similarly, if clients are not involved in identifying pain points, co-creating the solution and then providing input on the solutions developed, they are likely to resist adopting the new solution. Consistent and frequent communication and education is essential to overcome this resistance.
- Limited financial commitment — Firms tend to underestimate the time and financial commitment required to drive a successful digital transformation. The execution of a transformation roadmap can take about 12 to 18 months, and then requires additional investments to continue to stay ahead of all the market and technology changes. Leadership is often not prepared for this amount of financial commitment needed. Additionally, sometimes successful results can be back ended which puts extra pressure on leadership to demonstrate the results of the investment.
To drive a successful digital transformation a firm needs to take a wholistic approach, that starts with the business strategy and includes people and processes and technology. Below is a proprietary systematic “Five E” approach that can be used to digitally transform the organization.
Five E Approach to a Digital Transformation
- Examine — “Outside-in” analysis. Examine the business environment to identify shifts in customer needs, competitive landscape, regulatory environment, new technologies, etc., and their impact.
- Evaluate — “Inside-out” assessment. Evaluate all aspects of the business i.e., products/ offerings, processes, technology, & talent. Design the “business of the future” and determine the tactical steps to get there. Create a digital transformation roadmap.
- Execute — A critical and time-consuming step in digital transformation is to execute on the digital transformation roadmap. Change management is an important aspect of this phase.
- Establish — Once the transformation is completed, establish new KPIs, follow new processes, talent and operating models to continue to reap the benefits from the digital transformation.
- Encore — Digital transformation is an iterative process. Firm leadership will need to periodically examine and evaluate their strategy and approaches to meet changing market and business needs.
Source: Transformation of Professional Services — The Audit, Tax and Advisory “Firm of the Future”
Based on your experience and success, what are “Five Ways a Company Can Use Digital Transformation to Take It To The Next Level”?
- Better meet Clients’ Needs — A key driving force of a digital transformation should be to focus on better meeting client needs. This can be accomplished by getting regular client feedback on the product or service and identifying any “pain points” or areas of improvement. The business can then use this information to either transform an existing product or service or develop new/adjacent products or services.
- Transform How Existing Products/Solutions are being Delivered — The business can transform an existing product or service to better meet client needs. For example, during my time at a Big Four firm, we realized that the Audit in its current form, was not adding value to clients as it was backward looking, time consuming and expensive, and provided no valuable information to the client to run their business more effectively. This feedback provided us with the push need to transform Audit delivery, automate the mundane, repetitive tasks being performed by auditors, freeing them up to provide business and market insights to clients. This transformation enabled my firm to rapidly grow Audit revenues, improve margins, and gain market share.
- Develop New Products and Services and Expand Geographic Footprint — The business also has an opportunity to leverage technology to create new products and services, or establish digital channels to expand geographic footprint, and connect with a wider audience and explore untapped markets. I advised a utilities’ services business that was gathering significant amounts of data valuable to their customers. We transformed data gathering, leveraging AI-enabled drones. The team was able to convert the information gathered into actionable insights and provide a valuable deliverable to our client’s utility customers that enabled them to significantly differentiate themselves in the market. Using AI, we were able to transform a traditional business into a data firm and created a new revenue stream for the firm.
- Improve Client Experience / Satisfaction — Firms need to focus on continuing to improve their customer experience and satisfaction, to increase brand loyalty. Customers have got used to personalized experiences delivered by leading tech providers like Apple, Netflix, and Amazon. Businesses in other industries need to transform the way clients interact with them and provide a similar personalized experience, a holistic view of the relationship with them, and an efficient customer support system. This became a critical issue when I advised a leading retail bank that was seeing customer attrition. Studies showed that their customers were dissatisfied with their interactions with the bank and were moving to Fin techs that were providing them with tech-enabled personalized services in payments, digital banking, and for obtaining loans and insurance. To stem customer attrition and maintain/grow the business, the bank had to transform its client service capabilities, and offer digital solutions to remain competitive.
- Improve Decision Making — To enable a business to drive informed decision-making and allocate resources more effectively, firms are leveraging analytics. This often requires transforming and cleaning up the firm’s data so that AI tools can be applied to generate insights. I worked with the CFO of a media company who recognized the importance of her role as a trusted advisor to the CEO. To enable her to provide insights to her leadership team, we transformed the finance department to generate real-time firm and market financial data and insights, to support leadership with data-driven decision making. As a result of using our AI solutions, the CFO was able to guide the firm to drive double digit revenue growth, at a time when the market was flat.
- Increase Productivity and Efficiency of Operations –Digital transformation can be used by a business to transform its own operations, to improve efficiency and productivity. I saw this in action when I helped transform the entire business of a mid-sized professional services firm. We leveraged automation, digitization, and integration of systems to optimize workflows, reduce the manual work of professionals, and reduce errors in client delivery, while streamlining the firm’s back-office operations for efficiency and effectiveness. This enabled the firm to significantly improve its top and bottom line.
- Improve Employee Experience & Retention — One of the biggest challenges faced by most firms is employee retention, as junior professionals seek more satisfying and challenging work. Digital transformation enables firms to automate mundane, repetitive tasks, enabling the professionals to focus on more meaningful, value-added activities. I worked with a law firm that was dealing with high junior employee attrition due to the dissatisfaction of the associates having to work long hours on mind-numbing activities, handed to them by the senior lawyers. The loss of each junior associate cost the law firm thousands of dollars. To stem the flow of talent, we worked with the junior lawyers to identify the tasks that they found frustrating, which could be streamlined, automated and transformed leveraging tools and technologies. After transforming the tasks, we trained the lawyers to work with the new tools and solutions. As a result of these efforts, the law firm was able to retain its junior professionals and attract fresh junior talent.
In your opinion, how can companies best create a “culture of innovation” in order to create new competitive advantages?
To create a culture of innovation, firms need to empower their employees to innovate. It is well known that innovation happens at the “edges”, i.e. closest to the customer and by employees who see the issues and challenges they are facing and can provide insights into how to address the issue. A firm that wants to encourage innovation needs to do the following:
- Have a clear innovation strategy — The firm needs to have a clear innovation strategy for the business or the division. The more clearly a firm can articulate its innovation goals, and how they align with the firm’s strategy and vision, the more all employees within the corporation can contribute innovative solutions to meet those goals.
- “Tone at the Top” — Leadership needs to set the “tone at the top” about the importance of innovation. The message should include the firm’s strategy for innovation, so that all innovation aligns with helping the firm achieve that strategy. Additionally, leadership needs to provide support, funding, and time and space to the professionals to drive innovation and experiment. Finally, leadership needs to reward employees that take an active role in innovation to move the firm forward.
- Create a platform for sharing ideas and executing on them — The firm needs to provide a platform for idea generation, a place to incubate and experiment on the ideas, i.e. an innovation lab, time & funding, and business support needed to experiment and test out the ideas.
- Encourage cross-functional collaboration — To successfully innovate, usually requires bringing together people from functions that may not usually work together, i.e. business, technology, legal, risk & regulatory, and others are needed. Leadership needs to encourage and reward cross-functional collaboration.
- Create a safe space to experiment and “fail fast” — Leadership needs to foster an environment where employees feel safe to take risks, share ideas, fail and then learn from failures. Innovation and experimentation usually involve a lot of failures, the key is to be able to “fail fast” and pivot. Professionals need to feel safe to fail without it impacting other aspects of their professional life within the organization.
Can you please give us your favorite “Life Lesson Quote”? Can you share how that was relevant to you in your life?
My favorite quote is from The Alchemist, “When you want something, all the universe conspires in helping you achieve it.” I have seen this play out in my life. I believe that if you have a clear vision of what you want for your life, you will get there. It may not be in a straight line, you may make detours along the way, but if you know your ultimate destination and are determined to get there, you will get there. To give you one example. After I finished my high school in Thailand, I went back to India to do my undergraduate studies. When I was back, I knew that I could not live the rest of my life in India, which was an ethnocentric society, and incredibly biased and constricting. I wanted to live abroad, and my choice was the U.S. To move to the U.S. and be successful, I would need to get a local Masters’ degree, which was very expensive. Interestingly, I got the opportunity to work in Dubai, where I was able to make and save money. After a few years, I gave my GMATs, and got admission to come to Columbia Business School and was finally able to achieve my dream of coming to the U.S. and now have successfully lived here for over 25 years.
How can our readers further follow your work?
Readers can go to my LinkedIn profile: https://www.linkedin.com/in/nita-sanger/ and read my various articles or go to my website at https://ideainnovate.com/reports-tools/ for my articles, media appearances, etc.
Thank you so much for sharing these important insights. We wish you continued success and good health!